Supply shortage in central Tokyo sees apartment prices up 40% from market bottom

The price of secondhand apartments in Tokyo is rising, with prices in some areas exceeding those seen in the mini-bubble in 2007. In Tokyo’s 23 wards, the average asking price of a 70 sqm in October 2014 was 42,560,000 Yen, up 8.5% from the low of 39,220,000 Yen seen in July 2012.

One of the main drivers behind the rising prices is the shortage in the supply of brand new apartments. Following the Lehman Shock (or global financial crisis), a number of small-to-medium sized developers filed for bankruptcy. This has left the market controlled by a small number of Japan’s top developers. Prior to the Lehman Shock, the annual supply of brand new apartments reach 80,000 units. In 2014, it has almost halved to around 40,000 units. Buyers, who have not been able to find new apartments in their desired area, have turned to the secondhand market which has reduced supply even further. In the central Tokyo area, there are only half as many apartments on the re-sale market than there were in 2011. Read more

by Zoe Ward

Land prices up in 83% of locations - MLIT LOOK Report

The Ministry of Land, Infrastructure, Transport and Tourism (MLIT) announced the land price movements across Japan for the third quarter in 2014 (July 1 ~ October 1).

According to the Chika Look Report, 124 locations (83% of the total) saw an increase from the previous quarter, and 26 locations (17% of the total) saw no change. For the first time since this survey began in late 2007, none of the 150 survey sites saw a decrease in prices. Of the 124 locations to see a price rise, 122 locations saw prices rise between 0 ~ 3%, while 2 locations (Ginza and Shinjuku 3 Chome) saw prices rise between 3 ~ 6%.

Strong investor demand caused by monetary easing, as well as demand for apartments in areas with convenient access have helped to sustain the price growth.

In greater Tokyo, 58 locations (89% of the total) saw land prices increase, while the remaining 7 locations (11%) saw no change. In greater Osaka, 30 locations (77%) saw prices increase, wile 9 locations (23%) saw no change. In Nagoya, all 14 locations saw prices increase.Read more

by Zoe Ward

Secondhand apartment prices in October 2014 - Tokyo Kantei

Apartment price Japan October 2014

According to Tokyo Kantei, the average asking price of a 70 sqm (753 sqft) second-hand apartment in Tokyo’s 23 wards was 42,560,000 Yen in October, up 0.9% from the previous month and up 4.7% from last year. Asking prices have increased by 8.1% over the past 2 years. The average building age was 22.3 years.

In central Tokyo’s six wards (Chiyoda, Chuo, Minato, Shinjuku, Bunkyo and Shibuya), the average apartment asking price was 60,180,000 Yen, up 1.7% from the previous month and up 10.3% from last year. The average price has increased by 18.0% over the past 2 years. The average building age was 21.7 years.Read more

by Zoe Ward

Office vacancy rates in October 2014 - Miki Shoji

According to Miki Shoji’s office report, the office vacancy rate in Tokyo’s five central business districts (Chiyoda, Chuo, Minato, Shinjuku and Shibuya) was 5.60% in October, down 0.05 points from the previous month and down 1.96 points from last year.

The vacancy rate in brand new office buildings was 14.98%, up 1.08 points from the previous month but down 2.06 points from last year.Read more

by Zoe Ward

October rental data - Tokyo Kantei

According to Tokyo Kantei, the average monthly rent of a condominium apartment in greater Tokyo was 2,602 Yen/sqm in October, up 1.0% from the previous month and up 2.8% from last year. This is the first time in four months that the rent has exceeded 2,600 Yen/sqm. The average apartment size was 60.20 sqm and the average building age was 19.2 years.

The average monthly rent in Tokyo’s 23-ku was 3,233 Yen/sqm, up 0.8% from the previous month and up 4.9% from last year. The average apartment size was 56.74 sqm and the average building age was 17.4 years. Starting with Tokyo’s central 6 wards, almost all areas in the 23 wards have been seeing either stable or strong growth in rent.

Yokohama City is seeing a continued downwards trend. In Kobe City, the average building age increased from 19.9 years to 21.3 years, which caused a corresponding drop in average rent.Read more

by Zoe Ward

Secondhand apartment prices in September 2014 - Tokyo Kantei

According to Tokyo Kantei, the average asking price of a 70 sqm (753 sqft) second-hand apartment in Tokyo’s 23 wards was 42,160,000 Yen in September, up 0.5% from the previous month and up 4.3% from last year. The average apartment age was 22.5 years.

In central Tokyo’s six wards (Chiyoda, Chuo, Minato, Shinjuku, Bunkyo and Shibuya), the average apartment asking price was 59,160,000 Yen, up 1.0% from the previous month and up 9.5% from last year. The average apartment age was 21.8 years.

The average price across greater Tokyo was 28,230,000 Yen, up 0.3% from the previous month and up 1.2% from last year. The average apartment age was 21.8 years.Read more

by Zoe Ward

September rental data - Tokyo Kantei

According to Tokyo Kantei, the average monthly rent of a condominium apartment in greater Tokyo was 2,575 Yen/sqm in September, up 0.5% from the previous month and up 1.2% from last year. The average apartment size was 60.01 sqm and the average building age was 19.3 years.

The average rent in Tokyo’s 23-ku was 3,207 Yen/sqm, up 1.3% from the previous month and up 3.6% from last year. The average apartment size was 57.02 sqm and the average building age was 17.4 years.Read more

by Zoe Ward