The continuous growth of foreign nationals fueling the second hand real estate market

The continuous growth of foreign nationals fueling the second hand real estate market

So far we have already talked about the increase of foreign people visiting Japan twice. Along with this increase in foreign visitors, there has been a clear increase in mid-to-long-term foreign residents coming to Japan.

While the number of foreign residents temporarily decreased after the Great East Japan Earthquake of 2011, this tendency turned around in 2013 and the number began to rise again. 2015 in particular saw an impressive increase of 2.23 million people, a 5.2% rise over the previous year (According to the Ministry of Justice's figures for "Number of Foreign Residents"). It seems likely that increased business targeting foreign visitors to Japan, has lead to the number of foreign residents also increasing. While it seems obvious when you think about it, the rise in foreign residents in areas known for being tourist locations, such as Hokkaido and Okinawa, stand out in particular.

For the past few years, the pace of development of new housing in the capital has been sluggish. Land, materials, and personnel expenses have all soared, which in turn leads to increased building costs, drawing attention to second-hand properties.

The second-hand condominium market in the capital has been very favourable, with tendencies such a 38 month successive rise in the average contract price up until February of this year, but we are now seeing indications of a decline in momentum through such signs as higher numbers of unsold properties. With a continued increase of foreign people living in Japan, they are expected to help fuel the second hand property market going forward.

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