where all viable land is already pretty much taken.

Very much untrue, the actual issue with living away from one of the major cities is the same thing the US is dealing with: capitalism and a highway system (HSR there) encouraging suburban sprawl and the death of the small town. No need to visit 5 different shops in your small town if you’re going to pass a Donqi on your train ride into work. Then people eventually just move away from the smaller towns entirely to be closer to where the work and businesses are, and the cycle deepens

Although yeah, Japan is about 2/3 as big as California so it’s not as big as people think on top of that