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Average price of Tokyo area condo up 8.6% to new record in FY2022

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That is stupid money for what you get; a small parcel of air in the sky.

I bet many of these condos don't even have half the amenities you'd get in the US:

pool, 24hr gym, etc..

2 ( +6 / -4 )

Makes total sense, why you ask?

1) No need finance/invest in land given depopulation

2) Safety, community, convenience, views, access

3) Ability to rent out easily if one relocates

4) clear path to ROI/rent savings, tax advantages

5) Inflation's positive, borrower's benefit, NOT banks

For above reason many of us bought over decade ago, kept asking people why buy home given depopulation? Numbers now LOT tougher to justify, but same logic applies!

-7 ( +0 / -7 )

Plus, most mansions LOT safer in earthquakes, far better fire protection and tougher targets for criminals than your standard cardboard box!

-4 ( +1 / -5 )

Ask any mansion owner, building earthquake insurance almost always included in monthly dues, easy to buy cheap supplemental for INSIDE your unit. Private residence, largely impossible to buy or prohibitive.

Given aging and risk aversion, any wonder all these empty homes trying to be sold? Old homeowners are panicking, mansion construction would be MUCH higher if they could actually unload their homes, TRUE GLUT.

-3 ( +0 / -3 )

This is an informative article. As in, it gives us useful information. There is a prevailing view in Japan that if you buy a house or apartment, you will automatically lose a lot of money. This is not true in every part of Japan, including the most populated one, Tokyo. Real estate has been going up in value in Tokyo for at least ten years. That includes second hand mansions, and not land.

The alternative to not buying in Tokyo is renting, which can be much more expensive. Anyone buying this "average" condo in Tokyo with debt will also get tax benefits and essentially 70 million yen of free life insurance.

2 ( +5 / -3 )

Private residence, largely impossible to buy or prohibitive.

Well that's 100% nonsense. I pay 4400 yen per month.

3 ( +3 / -0 )

IMHO, average is not a good indicator of asset price movement. They should employ median instead.

Hope it's not going to get ridiculous like during Heisei.

4 ( +4 / -0 )

Who cares, most people have to think twice or simply can’t even buy a ticket to go to Tokyo. That article above that’s news for only a very few big investors or super rich people. And even those all will fall from the ladder one day and can’t take anything with them, neither their money nor the Tokyo condominium, when it’s time for the last travel.

1 ( +2 / -1 )

Private residence, largely impossible to buy or prohibitive.

Well that's 100% nonsense. I pay 4400 yen per month.

Hokkaido right? CHEAP, risks FAR lower; anyway, my supplemental for entire year about 80% less than your cost, plus Tokyo our risks much greater.

Something tells me you're in a cardboard box, right? My main concern's NOT financial, so no nonsense, but I do like Hokkaido, nice nature!

-2 ( +2 / -4 )

If I were renting private apartment, I'd try to find an older owner, figure out a lease to buy 'estate planning' scenario win win stuff, that's a good play.

Better if you have family and can 'appeal' to older generation, even better if owners got one foot in grave!

-4 ( +0 / -4 )

A new 6LDK house in my western Japan location is about ¥30 million. A good used one from about ¥10 million.

6 ( +7 / -1 )

A new 6LDK house in my western Japan location is about ¥30 million. A good used one from about ¥10 million.

Imagine how more will be emptying, especially in non-urban areas, trying to catch falling knife, rarely works out well. Numbers above do not lie, LOUSY investment.

This is ASSET DEFLATION in action, why banks won't even provide financing for home and second purchases in MANY markets now..., yet prices exploding due to global chaos and proxy wars in Ukraine especially!

-2 ( +2 / -4 )

Lack of plenty of information.

Price per square meter ?

Percentage bought by investors for renting and not living ?

Percentage bought by foreign investors ?

Price of rental to tell about ROI ?

Price of not new condos for comparison ?

It looks like a Ponzi scheme !

3 ( +3 / -0 )

Depopulation and aging, all need to know JP, rest is just details, FDI, maybe Tokyo Reits, that's ABOUT IT!

-4 ( +0 / -4 )

ClayToday  09:07 am JST

Makes total sense, why you ask?

1) No need finance/invest in land given depopulation

Clay, when you buy an apartment you also buy land. It’s equally divided by the number of units.

1 ( +1 / -0 )

No doubt WieWei but it's VERY marginal in general.

FYI, have some sharp friends buying OLD mansion in great locations, so they can be on ground floor for rebuild, Direct input, direct negotiations with builders, no lousy cockroach brokers needed!

That's a good play as well for those long-term thinkers!

-3 ( +1 / -4 )

The average size of a Tokyo apartment is 65 sq m.

My 6LDK is 150 sq m plus garden.

Imagine how more will be emptying, especially in non-urban areas, trying to catch falling knife, rarely works out well. Numbers above do not lie, LOUSY investment.

Really. New people moving in. Young families with children. New house construction every day of the week.

-1 ( +1 / -2 )

Hokkaido right? CHEAP, risks FAR lower; anyway, my supplemental for entire year about 80% less than your cost, plus Tokyo our risks much greater.

Something tells me you're in a cardboard box, right? My main concern's NOT financial, so no nonsense, but I do like Hokkaido, nice nature!

Nope, wrong again! Oh dear!

0 ( +0 / -0 )

Really. New people moving in. Young families with children. New house construction every day of the week.

Happy for Wallace but your market is an exception, depopulation and aging very correlated with non urban areas per actuaries, especially prefectures with small populations.

30M to 10M, your example, hardly great leading indicator but it's your call and certainly not everything's financial; numbers just reflect FUTURE expectations, not certainty!

-2 ( +0 / -2 )

These numbers are very misleading. They only show the sales prices of new units. As there has been an increase in the number of "premium" units built of course the average price has gone up. Land prices in Tokyo have risen in the last few years but nowhere near these figures.

0 ( +0 / -0 )

Clay

there are still many urban areas with healthy communities and not the doom and gloom you Tokyo people suggest. There are only 13 million people living in Tokyo.

People here don't buy houses for investments they buy them to live in and raise their kids.

0 ( +0 / -0 )

David Brent

Today 08:28 am JST

That is stupid money for what you get; a small parcel of air in the sky.

> I bet many of these condos don't even have half the amenities you'd get in the US:

> pool, 24hr gym, etc

The world isn't the USA!

To be more precise the USA condos you describe aren't even common in most of the USA.

The was majority of the developed world live in fairly simple and modest houses and condos.

I have notice 99% of the time a hear a foreigner complain about Japanese apartments, houses and condos they are from 3 places, the USA, Canada and Australia.

In Europe's major cities the apartments/condos are about the same as Japan unless you can afford a super luxury condo in London, Paris etc.. you will not have a gym pool etc.. and in NYC the same.

0 ( +2 / -2 )

Really. New people moving in. Young families with children. New house construction every day of the week

Not anymore, during covid the incentive to move out of the major cities was a flash in the pan.

As of just last month published right here on JT the U-turn has begun.

More moving into the major cities than moving out.

People quickly realized the daily car use to go shopping, to pickup kids from after school clubs, to go to a friend's house, even juku became more of a problem.

Rural high schools are empty and far between, hospitals transport, groceries.

Elderly and disabled condos in Tokyo near a station and supermarket are sold out before they even break ground.

I could drive into Ibaraki tomorrow or North Chiba or Saitama and find 50 new house in each place empty and 100 uncompleted because no buyers.

And it wouldn't take but a minute.

But the 5 house on my street were sold before the construction started.

-2 ( +0 / -2 )

We bought our place at the end of 2019, we looked at condos, we were not interested in having to deal with strata rules!

The decision was a house with land (no Rental land). We visited new developments in Ibaraki, North Chiba, north Saitama, Kanagawa, west Tokyo (not 23 wards).

We saw used places in Wako, Kawaguchi, and various wards in Tokyo.

In the end we got Lucky right near where I have lived for all my time in Japan and wher6my children were raised.

3 floors, 36m2 per floor parking 3 beds 2 bath 2 toilets 2 kitchen a 1m x 5 m garden.

Older but I did all renovations, we have 2 hospitals (on university hospital) within walking distance 3 supermarkets within 6min a tram 2 min, a metro and train station 6 min monorail 7 min, another train station 7 and yamanote line station 17 min walk if we want.

Our mortgage payment is 30 % less than what my rent was for a much smaller place including taxes etc...

I can walk 30 seconds to the 7-11 at any time, my heart condition means I have a doctor available near by never a problem.

And since the end of covid we have been annoyed daily by fudosans ringing our door asking if we want to sell and the prices offered are far more than we put into the place.

But everything has gone up so if we sold, there is no way we could buy anything nearly as nice.

We now have a sign saying we are not interested in selling, most of our neighbours have the same sign as the neighbour behind printed them.

0 ( +1 / -1 )

Depreciation!! Depreciation and you are left with a concrete block after 30 years!!! You can buy a burned down building in SF for millions that was probably built in the 1930's. Its all about appreciation and equity in an investment not divestment!

1 ( +1 / -0 )

kaimycahl

Today 09:08 pm JST

Depreciation!! Depreciation and you are left with a concrete block after 30 years!!! You can buy a burned down building in SF for millions that was probably built in the 1930's. Its all about appreciation and equity in an investment not divestment

Again the Americans!

Alternative you pay rent for 30 year and have nothing but even the amount you can still get for that concrete block!

Oh and your mortgage payments will be 30% less than the rent on the same place.

Why do Americans think all the world worked like America (USA)?

-2 ( +1 / -3 )

@Antiquesaving you buy a wooden shack and after 30 years its out of code, and you have to tear down and rebuilt or all you have is pay dirt. You obviously don't know real estate in the US. The homes appreciate not depreciate. You buy in Japan the home depreciates not appreciates. I have several and I have learned my lesson its better to be a land lord and renter in Japan. The land lord makes money because he can rent the place out forever and make money even though its going to lose value at least he is making money. Investing is better, there is no way I would buy a home in Japan only to see it spiral down in value and after all those years you are left with dirt!! Dream on! This has nothing to do with being "AMERICAN" its about having common business sense!

-1 ( +0 / -1 )

Antiquesaving

   Really. New people moving in. Young families with children. New house construction every day of the week

> Not anymore, during covid the incentive to move out of the major cities was a flash in the pan.

How would you know? You don't even know where I live, but still, you know more about where I live than than I do. The population of our city has increased every year, not decreasing.

People quickly realized the daily car use to go shopping, to pickup kids from after school clubs, to go to a friend's house, even juku became more of a problem.

Not where I live.

Rural high schools are empty and far between, hospitals transport, groceries.

Can you explain why we have more than 12 schools of every level?

Elderly and disabled condos in Tokyo near a station and supermarket are sold out before they even break ground.

Really,

I could drive into Ibaraki tomorrow or North Chiba or Saitama and find 50 new house in each place empty and 100 uncompleted because no buyers.

You know everywhere?

Only 13 million people live in Tokyo where to the rest live?

1 ( +1 / -0 )

The last thing Japan needs is to end up like the UK. If it's a choice between restrictive tax liabilities in Japan or more freedom to buy/ sell in the UK, you are much better off in Japan.

Young people just cannot afford to buy anywhere in major cities in the UK and in most commuter towns. Not unless they have £40k to put down as deposit for a small apartment. And that's if they win the mad scramble that occurs when somewhere 'affordable' comes up.

Japan can still offer affordable property to buy within a commute of Tokyo/ Osaka/ Yokohama and without the strict regime required to apply for the mortgage loan.

Yes in Japan you could end up not handing much to your children when you pass. But isn't it better to have had a life living in your own home in Japan than not at all in the UK where you might still be renting somewhere at the end of your working life.

2 ( +3 / -1 )

Tell me how much did homes in Detroit appreciate? Oh wait they didn't!

Yeah you're right in a local area over the short term

But this is not the general case in the US and Europe.

My US property is now 4 times what I paid for it in 2005 ($400k) and my UK property is 8 times more than what I paid in 1992.(£150k)

Japanese property doesn't generally appreciate like this. But certain rea estate is still a good investment in Japan. Certainly keeps the builders employed.

0 ( +1 / -1 )

I bet many of these condos don't even have half the amenities you'd get in the US:

pool, 24hr gym, etc..

Included shootings, racism, cops brutality, dirty neighborhoods full of homeless and drugs, everything is far away, car needed for everything, pathetic transport system, inconvenient infrastructure, and unfair monthly increasing on rent..

No thanks..

0 ( +2 / -2 )

Nothing like Tokyo..

Tokyo is not for everybody, is for the brave ones who want to live in one of the best cities of the world and knows ho to appreciate this incredible city..

In other words, is not for whiners, lol..

-1 ( +2 / -3 )

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