Japan average land price rises over 2% for 1st time

Because prices are increasing in general, this is not too surprising.

By the way, Kansai is still cheap :)

The pernicious result of a government trying to inflate away its spending and debt problems. Besides currency devaluation, tax creep, which takes more money out of the hands of citizens, is exactly what the government intended.

The government changed the method of valuation to make things look better than they were, and now land values are at or higher than the bubble era.

With it, my property taxes have jumped too! Not a happy camper!

Why did they change how land prices are calculated in 2010, and what are the new criteria? Doesn't it make comparisons before that impossible?

Yen depreciated 60% and land price in terms of JPY increased 2%. What a joke!!!

Since 2010 isn't exactly long term data....

Yubaru

Today 07:39 am JST

The government changed the method of valuation to make things look better than they were, and now land values are at or higher than the bubble era.

Are you being serious?

During the bubble a 47sqm condo in the edge of 23 wards Tokyo sold for over ¥50 million.

Today a newly build 80sqm condo by the same company is ¥40 million.

Property value evaluation methods change based on many factors and this is nothing new, the system has been revised several times over the passed 150 years since the Meiji period started.

This is not unique to Japan!

With it, my property taxes have jumped too! Not a happy camper

Define "jumped"! Ours went up ¥5,000 in Tokyo, I wouldn't call the a "jump".

A home in comparable cities:

Property tax on a home and property the same values as my place sort of depends on the ward but it is basically under ¥100,000 a year.

A home with The same evaluation in London wound be over ¥ 600,000 a year, in New York over ¥900,000 a year!

I don't think people realize how low Japan's property taxes are in the major cities compared to other western countries.

My siblings back home are payment near equal in monthly mortgage as property tax, if Japan had the same property tax as my city of birth I could never afford to pay the tax and mortgage each month!

tora

Today 08:06 am JST

Why did they change how land prices are calculated in 2010, and what are the new criteria? Doesn't it make comparisons before that impossible?

Actually no!

First every country/city makes changes over time, some minor some major.

Example in the past 30 years my city back home changes the property tax evaluation 3 times. The first ended up lowering the taxes, the second raised beyond comprehension that people couldn't pay the latest came with massive changes.

The taxes were reduced to Abou half but this was offset by other taxes, garbage pickup was no longer free you need to purchase a bin and pay a yearly fee you cannot exceed the amount in the bin so no extra bags want more pay another fee, etc....

So it is nothing new to reevaluate how the taxes are calculated.

As for comparing from before the changes

It is always possible, complicated but possibly and I can imagine some are experts in doing these things

Examples are currency, when countries revamped their currency systems experts can figure out equivalencies today via complicated formulas.

I am sure the same can be done but probably not readily available for the article.

We bought farmland for literally the cost of the conveyancing.

This story mostly relates to urban areas.

But to my mind, rural land is far more valuable.

If Kyodo could be bothered to delve deeper into the data, and the data were better to begin with, I think you'd find what's happening in Japan confirms the "location, location, location" real estate adage even more.

Yes, land prices are definitely going up, but only in certain cherry picked locations. Mostly prime city centers and certain resorts or resort-like hotspots. Note that since building costs have also gone up, the price of old houses in such places will also be going up, on the assumption that you'd renovate and not knock them down. Someone may tell you that houses of a certain age are worthless and they were built to last "twenty five years". That might be true in that town, but it won't be true for a twenty five year old house in Karuizawa or Shonan.

In some non-descript, quite-far-out commuter town or the vast majority of the countryside where lots of akiya exist, prices will not be going up.

kohakuebisu

Today 10:28 am JST

What you describe is basically everywhere in the world!

Vancouver is extremely expensive to buy a home but head inland to the mountains and the prices are not even comparable.

New York city and direct surroundings is expensive, go into upper New York State and again prices are nowhere near the same!

This is nothing new, the UK, USA etc...a in the late 1800s early 1900s when the train routes were being built land in towns where the train passed and stopped became far more valuable and towns that once were more valuable and popular but didn't get a train station often because ghost towns or irrelevant!

In Japan Utsunomiya was once a major business city due to its canals and the transport system via the waterways.

It rejected the trains and the railroad was passed elsewhere.

It never recovered from this as transportation was diverted to other areas where the train passed.

Ease of transport, convenience of living, access to markets all play a role in values and in 99% of the cases more popular, more access, more to see or do means higher values.

I live on station (4km by roads) from where I lived for nearly 26 years.

The place I lived had everything, 2 major stores, multiple trains lines, 3 metro lines you name it!

The price of buying a property and house there was way way beyond my means, but just one station over more inside Tokyo 23 wards and suddenly the places were well within my budget and I bought a very nice house bigger than a far more expensive one in my previous location.

I recall during the bubble years having Japanese business people, often flush with temporary wealth from the stock market, ask me how much Manhattan was worth, and I knew Brits that were asked how much land in some part of London was worth; I, and most British people I knew would typically say "don't know" then the businessman would say, 'if such and such property with a hotel on it in Tokyo was sold, that money could be used to buy all of Manhattan', or something similarly silly to that. And then the bubble burst...what has been learned since then? It reinforced to me that unchecked greed can have serious negative consequences, but I, often just a casual acquaintance of the company worker had many high priced meals, courtesy of middle level managers using their company's credit card.

During the bubble a 47sqm condo in the edge of 23 wards Tokyo sold for over ¥50 million. Today a newly build 80sqm condo by the same company is ¥40 million.

There is more than likely a plethora of reasons why that happened, But where I live I PERSONALLY know that land prices first dropped, then have, over the course of the last decade, jumped a heck of a lot more than 2.3%

The property MY house sits on, roughly 110 tsubo, is now valued at over 260,000 per tsubo, when it was, roughly 10 years ago, at a low of near 170,000. So I am telling you from PERSONAL experience land prices have skyrocketed here.

You do the math and then tell my city office to only pay the lower amount!

There are USED condos selling for over ￥100,000,000.

Yubaru

Today 01:38 pm JST

Personal feelings are not facts or reality.

Land/housing/property peaked in 1990/91 and dropped like a rock after.

Yes they are up from the low point, but they are nowhere near the prices of the bubble .

The bubble is from 1986 to 1991 and land prices today are not much more than at the very very early bubble prices around 1987.

https://fred.stlouisfed.org/series/QJPN628BIS

This is the same graph as multiple other sites!

https://japanpropertycentral.com/2023/09/japans-standard-land-prices-increase-by-1-0-in-2023/

What you describe is basically everywhere in the world!

Well, "location, location, location" is not a Japanese expression, its an English one!

However, if I'm allowed one example, a meh 25 year old house in fairly central Karuizawa will be I dunno 50-60 million yen. 20km away in Gunma, you can get an akiya for 2-3 million yen. The cost of completely redoing the walls and windows, neither house will have good insulation or good windows, will be roughly the same. The purchase price though will be twenty times different.

20km outside a posh town in the UK, say Cambridge, will be much cheaper than central, but it won't be 95% off. It will also be appreciating in value so long as Cambridge real estate goes up. Akiyas in north west Gunma will have essentially zero "Karuizawa premium". They will be dirt cheap like the rest of inaka and they won't be going up in value.

Must be foreign buyers (through proxies of course!)driving up the prices through overestimating the worthlessness of the yen.

Must be foreign buyers (through proxies of course!)driving up the prices through overestimating the worthlessness of the yen.

You love drama, right??, LOL..

The Yen goes down and the price of land goes up. SMH!

Land prices going up everywhere is just a reflection of currency values going down. They are two faces of the same coin