But I agree that prefabs aren't particularly interesting.
It makes “commute until you qualify” longer than it might otherwise be. And it doesn’t help that there has long been a tendency to overcentralize in Tokyo, which is very large and can take a while to commute around.
Or is the catch that they're so cheaply built that you don't want to live in them?
Yes, or at least they'll need a big refurb.
I highly doubt that "designing for it" really beats inherently stronger building materials to specifically choose wood with its many, many other disadvantages over something else.
There is a reason Japan traditionally used wood, it works well in general. The design for it parts of wood are not hard - I don't know Japanese history, but I'd guess they figured it out well B.C.
You don't need to flex, and dissipate energy if you can simply withstand earthquake G forces through strength alone. And even if you do, steel is obviously better at energy dissipation.