Mt Rokko’s corporate retreats to be converted into lodging for foreign tourists
Hyogo Prefecture and Kobe City are embarking on a plan to convert unused corporate retreats and holiday homes in Mt. Rokko into accommodation facilities for foreign tourists.
Mt. Rokko is said to be West Japan’s version of Karuizawa, and was historically a popular summer mountain resort area. Following the 1995 Great Hanshin Earthquake, tourist numbers dropped significantly and the area went into decline. A city investigation in 2016 found 171 of the 233 corporate retreats were not being adequately maintained and potentially falling into ruin.Read more
Central Tokyo apartment sale prices break new record in September
Second-hand apartment sale prices in central Tokyo reached a record high in September, while prices across the metropolitan area saw a year-on-year increase for the 48th month in a row.
According to REINS, 3,150 second-hand apartments were sold across greater Tokyo in September, up 32.1% from the previous month and up 13.6% from last year. The average sale price was 31,260,000 Yen, up 3.9% from the previous month and up 5.7% from last year. The average price per square meter was 490,600 Yen, up 2.9% from the previous month and up 6.0% from last year. This is the 45th month in a row to see a year-on-year increase in the sale price per square meter. The average building age was 20.15 years.
In the Tokyo metropolitan area, 1,651 second-hand apartments were sold, up 37.6% from the previous month and up 18.9% from last year. The average sale price was 38,350,000 Yen, up 2.3% from the previous month and up 6.3% from last year. The average sale price per square meter was 647,700 Yen, up 1.7% from the previous month and up 5.8% from last year. This is the 48th month in a row to see a year-on-year increase. The average building age was 19.14 years.
In the Tokyo metropolitan area, transactions on apartments over 100 million Yen in the third quarter of 2016 were up 18.8% from 2015.
Central Tokyo’s 3 wards
In central Tokyo’s 3 wards (Chiyoda, Chuo and Minato), 190 second-hand apartments were sold, up 41.8% from the previous month and up 21.8% from last year. This is the highest number of recorded transactions for the month of September in over 9 years.
The average sale price was 65,810,000 Yen, up 22.6% from the previous month and up 23.9% from last year. The average price per square meter was 1,093,300 Yen, up 3.6% from the previous month and up 6.7% from last year. This is the highest level seen since record-keeping began in January 2008, and is 58.3% higher than the low seen in November 2012 when the market bottomed out. The average building age was 16.62 years.
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Norman Foster designed house in Kamakura to be converted into museum
Kamakura City is preparing to open a museum in a former private residence designed by Norman Foster. Starting next year, the public will be able to step inside a landmark property that has been off-limits for the past 12 years.
The one-of-a-kind property is located a 9 minute walk from Kamakura Station in the Ogigayatsu neighbourhood. The house was donated to the city in 2013. After some interior alterations, the museum is scheduled to open in April 2017.Read more
Behind Tokyo’s brisk resale market for apartments
The second-hand apartment market in Tokyo continues to grow with the average asking price of a 70 square meter apartment in the Tokyo metropolitan area reaching 48,090,000 Yen in August 2016, up 10.5% from the previous year. In Tokyo’s 23 wards, the average price increased by 8.5% over 12 months to 52,790,000 Yen.
Ebisu Garden Terrace Ichibankan, a 32-storey, 290 unit tower south of Ebisu Station, is a prime example of capital appreciation. In late 2015, an apartment on a high floor sold for 2,194,000 Yen/sqm, making it the highest resale reported in this building in the past 27 years, and similar to the current price of brand new apartments. Sale prices slumped to a low of 1,300,000 Yen/sqm in 2013, but increased to 1,670,000 Yen/sqm in 2015 (up 48%). Recent prices have exceeded previous prices last seen in the mini-bubble in 2007. Despite having 290 apartments, there were just two listed for sale in October 2016, with asking prices ranging from 1,640,000 ~ 1,790,000 Yen/sqm.Read more
Investors finding success with Kyoto's traditional machiya
Kyoto’s traditional machiya townhouses are a popular commodity with domestic investors looking to profit from the booming tourist industry.
Machiya are appealing for their charm and character which cannot be easily replicated in new construction. The traditional architecture and relaxing interiors are also a major drawcard for tourists travelling in families or groups.
The age of these old properties also has tax benefits. Brand new construction may have a useful life for tax depreciation purposes of 20 years or more, but with an older property, the depreciation can be amortised over just 3 ~ 4 years in some cases. For an investor with a high annual income, this could allow them to reduce their tax burden.
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Faulty apartment building in Yokohama to be demolished next year
Last month, two years after the building was found to be tilting, the owners association of a condominium complex in Yokohama voted in favour of redevelopment.
In October 2015 it was announced that several of the foundation piles in one of the buildings were not sunk deep enough to reach bedrock and a 2 cm difference in height had developed between the buildings. Residents were assured by the developer that the building posed no immediate risk and still met earthquake-resistant standards. However, further inspections found that the building would not withstand an earthquake producing a seismic intensity of 5+ or higher. In August 2016, Yokohama City issued the developer with a correction order under the Building Standards Act.
The 12-storey condominium was built in 2007 and contains over 700 apartments.
Demolition of all four blocks in the complex, including the one that has already started to show signs of tilting, will start as early as April 2017. It will be replaced by new buildings which should be ready for residents to move into from late 2020. The developer will bear the 40 billion Yen (390 million USD) cost of redevelopment.
Under the Condominium Unit Ownership Act, 80% of owners must vote in favour in order to redevelop a condominium. In this particular case, 99% of owners were in favour of rebuilding. Those that were not in favour will be forced to sell their apartments to the owners association, as outlined under the Act.
It is likely that the redevelopment committee will select a different developer to carry out the reconstruction, rather than the original developer. Apartment owners who plan to move into the new building will be provided with temporary housing in the meantime. In addition to shouldering the cost of redevelopment and temporary accommodation, Mitsui is providing each household with 3 million Yen in compensation.
Sources:
The Nikkei Shimbun, September 19, 2016.
The Tokyo Shimbun, September 20, 2016.