New apartment price-to-income ratio drops for first time in 7 years

According to Tokyo Kantei, the average price of a brand new apartment across Japan was 7.59 times the average annual income in 2016, down 0.07 points from 2015 and the first drop reported in 7 years.

The price-to-income ratio across greater Tokyo was 10.68, down 0.31 points from 2015, and the first decline seen in five years. An increase in wages coupled with a stabilization of new apartment prices has been the cause behind the lower ratio. In fact, the number of prefectures across the country that saw an increase in the price-to-income ratio decreased from 36 in 2015 to 19 in 2016.

In the Tokyo metropolitan area, where the luxury apartment market is booming, the ratio increased for the 3rd year in a row with a new apartment costing 11.46 times the average annual salary.