New apartment price/sqm in 2020 hits 30-year high

According to the Real Estate Economic Institute, the total number of brand-new apartments released for sale across greater Tokyo in 2020 increased for the first time in 3 years. 29,032 apartments were supplied, up 1.7% from 2019.

Sales offices were closed in April and May during the first State of Emergency, leading to a record low supply for those two months. However, the market resumed from June onwards. Demand also returned with vigor. With more people spending time working from home, there has been a growing desire to move out of a cramped rental and into a larger condominium. Low interest rates and relatively low unemployment have continued to support the market for homebuyers. 

Supply in Tokyo’s 23 wards dropped 15.2% to 11,131 units as land development sites remain scarce. Saitama Prefecture saw supply drop 1.4% to 3,573 units. Kanagawa Prefecture saw a 1.7% increase, and Chiba Prefecture saw a 59.7% increase. 

The average apartment price was 59,940,000 Yen, down 1.0% from 2019 and the first decrease in 4 years. The average price per square meter, meanwhile, increased by 0.4% to 905,000 Yen. This is the 9th year in a row to see a year-on-year increase in the price per square meter and the highest price seen since 1990 (949,000 Yen/sqm). Apartment prices have remained high due to land and construction costs.

In Tokyo’s 23 wards, the average price was 75,640,000 Yen, up 2.2% from 2019. The average price per square meter was 1,221,000 Yen, up 6.1% from 2019.

The contract ratio across greater Tokyo was 67.9%, up 6.6 points from 2019 and the fifth year in a row to be in the 60% range. In Tokyo’s 23 wards it was 68.9%, up 9.1 points from 2019. Chiba Prefecture’s was the highest at 78.1%.

Note: The Institute’s data is based on the fiscal year from April 1, 2020 to March 31, 2021.

Source: The Real Estate Economic Institute, April 19, 2021.

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