The supply of brand new apartments released for sale in Kyoto City in 2018 increased for the first time in 5 years to 1,277 units. This was a 4.7% increase from 2017. Supply in the city center, however, is exceedingly low with developers focusing on building hotels to cater to the city’s booming tourism industry.
Apartment developers, forced out of the city center, are shifting their attention towards building family-type apartments in surrounding areas such as Ukyo, Yamashina and Fushimi wards, and even as far as neighboring Shiga Prefecture. The cheaper offerings in these areas has pulled down the average for the city as a whole. The trend is expected to continue in 2019.
The average price of a 70 sqm brand new apartment in the center of Kyoto is in the 80 million Yen (approx. 730,000 USD) range, putting it at a level similar to Tokyo. The average price across Kyoto City was 38,140,000 Yen, down 12.9% from 2017. The average price per square meter was 647,000 Yen, up 0.9% from the previous year.
The contract ratio was 96.7%, indicating very strong demand and exceeding Osaka City’s ratio of 90.6%. There were just 66 unsold apartments as at the end of 2018.
With the exception of Kyoto City, Kyoto Prefecture suffers from a drastic shortage of suitable apartment development sites close to train stations. In 2018, just 64 new apartments were released for sale in the prefecture (excl. Kyoto City), a 74% decrease from 2017 and an 87% drop from 2016.
The Real Estate Economic Institute, January 22, 2019.
The Kyoto Shimbun, January 23, 2019.