Plans for a 190m tall, 50-storey, 750-unit apartment tower on the manmade island of Tsukishima in Tokyo Bay have local residents up in arms.
The following is a summary of the recent information that has come out since the share house and whole-building investment scam scandal has been exposed in Japan.
Inflated rental projections
Guaranteed or estimated market rents were set much higher than actual market rents in order to inflate yields and sale prices. Share houses were perfect for this since it can be difficult to gauge appropriate market rent, making it easy to inflate figures. Share houses operated by one defunct operator were running at occupancy ratios of just 20%.
There are plans to redevelop the former Namegawa Island zoo and garden in Chiba Prefecture into a 228-room resort hotel. Construction on the tentatively-named Katsuura Seaside Park Resort is scheduled to start in 2020 with completion by 2024.
Yesterday the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) announced the Standard Land Prices for 2018. The average standard land price across Japan increased by 0.1% – the first increase since 1991. This follows a 0.3% drop recorded in 2017.
According to the Real Estate Economic Institute, the supply of brand new apartments across greater Tokyo in August reached the lowest level seen for the month since 1993. A total of 1,502 new apartments were released for sale, down 49.7% from the previous month and down 28.5% from last year.
According to Tokyo Kantei, the average monthly rent of a condominium in Tokyo’s 23 wards was 3,464 Yen/sqm in August, down 0.5% from the previous month but up 5.1% from last year. This is the 9th month in a row to see a year-on-year increase. The average apartment size was 55.47 sqm and the average building age was 19.5 years.
– COMPLETION –
Follow our journey as we renovate a traditional machiya townhouse in Kyoto. Once complete, the renovated machiya will be offered for sale.
It has often been said that Japanese consumers prefer new construction over old. However, this way of thinking has started to change over the past few years with home buyers turning their attention to the existing home market. In 2016, sales of existing ‘second-hand’ apartments in greater Tokyo exceeded those of brand-new apartments for the first time ever. This has not gone unnoticed by Japan’s major real estate developers, who, once focusing solely on new construction, are now entering the growing renovation market. 15 of the top 20 developers are already active in this market.
Fuji Keizai, a marketing research and consulting group, forecasts over 27,000 homes and apartments to be renovated and sold across Japan by professional house-flippers in 2018, up 10% from 2017. By 2020, this number is forecasted to reach 35,000 units, with a total of 131.4 billion Yen spent on renovations.
Hotel Okura has released the details on their rooms and facilities for their 110 billion Yen Hotel Okura Tokyo redevelopment. The 508-room hotel is scheduled to open on September 12, 2019.
According to REINS, 2,303 second-hand apartments were sold across greater Tokyo in August, down 26.6% from the previous month but up 1.7% from last year. The average sale price was 33,180,000 Yen, down 1.3% from the previous month but up 2.5% from last year. The average price per square meter was 521,000 Yen, down 300 Yen from the previous month but up 3.2% from last year. This is the 68th month in a row to record a year-on-year increase in prices.