Why there are many nice used cars sale in Japan?

There are several reasons.

Japanese like new one.

The price of cars are probably cheapest in the Asia (cos no need to worry importing tax. and other car related taxes are also cheap. Even imported car, like Mercedes and BMW are cheaper than Taiwan and Singapore).

And another reason is there is special loan system.

It is difficult to explain, but something like this.

If the price of a new car is US$40,000, people in the world usually have to pay US$40,000+tax+ other expenses.

But some car dealers in Japan deduct "resale price" first.

eg. You may be able to sell the car with US$20,000 price in 2 or 3 years later.

The dealer deduct this price first, then you can purchase the new car with US$20,000+tax+ expenses only.

If you brought the car to the same dealer 2 years later, you can buy new model with 50% price again (real contract is more complex. There are also some risks. But outline is like this).

The loan disappear within the years (2 or 3 years).

That is why young people can ride new car every a few years..

Basically, yeah. The law in Japan is that you have to get your car inspected in its 3rd year and then every 2 years after that. The price of inspection is set by the government and rises exponentially based on the age of the car, and you have to pay for any repairs to even unimportant parts of the car. (My friend had to pay them to fix the cig lighter even though he never smokes!)

After 10 years or so it becomes cheaper to buy a new car than to pay the inspection fee. Since Japanese people tend to take very good care of their cars, that means there are lots of cars in really nice condition lying around that nobody can afford to drive here in Japan. They get shipped out by the boatload to other countries and sold for a nice profit.