[throwaway2037]

There are two main reasons why housing is more affordable in Japan compared to many other highly developed nations: (1) There is functionally no NIMBY-ism. There is a single, unified national building code that screams YIMBY-ism. (You can Google about it.) Also, almost no buildings are protected from tear-down/re-dev. As a result, large cities in Japan appear to be constantly under construction. Tear-down and re-build is a very common pattern in urban areas. (2) Home loans for 30 years are less than 1%, and required down payments are tiny (0% to 10% is common). This dramatically changes the affordability equation.

The "free houses" you have heard about are called akiya (空き家). There are countless YouTube videos and blog posts to learn about how it works. You are basically buying an abandoned home from a local gov't agency.