Price-earnings ratio for apartments in Tokyo reaches record high in 2016
According to Tokyo Kantei, the price-earnings ratio (PER) for brand new apartments in the greater Tokyo area reached a record high of 28.66 in 2016, up 1.36 points from 2015 and the highest level seen since reporting began in 2002. A PER of 28.66 indicates a gross yield of approximately 3.51%.
Price growth of new apartments has far exceeded the change in rental prices, resulting in yields dropping to record lows. The average price of a brand new 70 sqm (753 sq.ft) apartment in greater Tokyo was 59,980,000 Yen in 2016, up 26.3% from 2012. The average rent of a 70 sqm apartment in 2016 was 175,551 Yen/month, up 4.8% from 2012.
The greater Osaka and Nagoya regions also had PERs of around 28 in 2016.
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