Tokyo condominium developers signaled strong market sentiment in the first half of 2018, as they released 43.5% more units to the investment market versus the comparable period last year. The average sales price for an investment-use condominium also increased (9.3% year-on-year) to ¥30,880,000 ($278,000). These were the key takeaways in a report recently released by the Real Estate Economic Institute, a Tokyo-based think tank.
Below are other highlights in the investment condo market report for the first half (January to June) of 2018:
Developers Bullish? Plus Planned Consumption Tax Hike
In the Tokyo capital region (which includes the Tokyo 23 Wards, the Tokyo western suburbs, and Saitama, Chiba, and Kanagawa prefecctures), developers released a total of 96 buildings for sale in the residential investment condo market, a year-on-year increase of 55.0%. In the same period last year, only 30 buildings were released in the comparable period and a total of 120 buildings were released for all of 2017.
As developers generally time the release of properties to prevent flooding the market, it is considered a bullish sign that so many more properties were released in the first half of this year. On the demand side, investors may be motivated to enter the market before the scheduled consumption tax increase in October 2019. The last time the consumption tax was raised, there was a surge in home sales (including units bought for investment) in the year leading up to the tax hike.
From January to June 2018, 4,623 individual units were released for sale, compared to 3,222 last year, an increase of 43.5%, as mentioned above.
Fewer lower-priced units
Year-on-year, developers released fewer units in the lower-price range (below ¥25 million), with 855 individual units available in this range (18.5% of all units available) versus 1,344 units (41.7% of all available units) for the comparable period last year.
The average size of an investment condominium released for sale was 26.58-sqm (an increase of 5.2%, compared to last year’s average size of 25.25-sqm).
Top Five Areas
The following are the fop five areas by number of units released:
- Edogawa Ward, Tokyo: 640 units
- Itabashi Ward, Tokyo: 443 units
- Shinjuku Ward, Tokyo: 430 units
- Nakahara Ward, Kawasaki: 400 units
- Sumida Ward, Tokyo: 332 units
Units released for sale in the top five areas comprised 48.8% of all units, compared to 41.8% last year.
Top Five Companies
The following are the top five companies (from a total of 17 companies), by number of units released:
- Shinoken Harmony (シノケンハーモニー): 880 units
- FJ NEXT Company, Ltd. (エフ・ジェー・ネクスト): 423 units
- TFD Corporation (TFDコーポレーション ): 394 units
- in Valence (インヴァランス): 391 units
- Kinoshita Real Estate (木下不動産): 390 units
Number of units only reflects units released to the investment market.
FAQs About Buying Property in Japan as a Foreigner
Can a foreigner buy property in Japan?
Yes. You can buy property in Japan regardless of your nationality or country of origin. There are also no residency requirements for buying real estate in Japan. Securing financing as a resident foreigner is more complicated. For info on financing, please see “Basic Requirements for Getting a Mortgage as a Foreigner in Japan“.
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For information about purchase and brokerage fees: Breakdown of real estate purchase fees and taxes in Japan
Need to know: Earthquake building codes and technology in Japan
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