Did the prices of real-estate went up over the past 2 years?

[person234]

@milagrace2018 During Covid i lived in an amazing building in the heart of Shibuya near Parco, it was 190,000 yen per month.

I left a few months after the borders reopened and that same unit now is 260,000

 

[wizz]

@milagrace2018 Here is some housing price index chart from the government, with fairly recent data: https://www.realestate-tokyo.com/news/market-trends-japan-2023/
According to this, and various other sources, yes prices have increased continuously over the years, starting from around 2013, but not in the scale quoted by op.
Even sources focusing on Tokyo and other major cities data don’t show a 75% increase over the past two years.

 

[arcticwind]

@wizz https://www.fudousankeizai.co.jp/share/mansion/573/ss2023.pdf check the official report. New condo prices were up about 40% just in 2023 in Tokyo 23 wards. It doesn't explain the increase in Tachikawa, but the report doesn't specifically target Tachikawa. The non-23 wards areas definitely went up non-uniformally, as did the 23 wards.

 

[wizz]

@arcticwind Interesting. On the renting side though, I don’t seem to see such a high increase, when looking at listings.
Checking current rent in all the open condos from a high rise mansion where I used to live in Nagatacho until 2018, the prices have marginally increased since I moved (5~10% max).
Checking the ones I used to live in Akasaka until 2012, same thing.
So is price of new condos for sell just being artificially inflated partially due to investors, but don’t actually result in similarly higher rent prices due to “lack” of renters?

 

[arcticwind]

@wizz there is always supposed to be a spread between rent and condo prices, but on average rent prices are up 10% (EDIT: In Tokyo only of course. But cities like Osaka are also on the up and up.).

 

[jaeb]

@milagrace2018 Mitsui Fudosan has this recently: Quarterly Report for Premium Condominiums in Tokyo | 3Q FY 2023

In short, prices have been rising for a decade, slowly at first and faster more recently.

 

[heyitsthatguy1247]

@milagrace2018 yes prices went up, although the general gist of japan reddit is still that "JaPaN ReAlStaTe AlWaYs GO DOwN". Which is a dumb take lacking any nuance.

 

[albinoguitman]

@heyitsthatguy1247 I've only seen the very sensible "building prices go down, while land prices stays constant or go up in central areas" everywhere around. Which is also by law BTW (the first half). This is also not JapanLife, please don't make it become the same with this sort of low-quality mock comments.

 

[heyitsthatguy1247]

@albinoguitman lol no, there are two mantras in japan reddit (including this sub), this being one of them: "RE always go down". I dont agree with it, it is a dumb take with no nuance.

 

[buffalopat]

@heyitsthatguy1247 I think the understanding is that real estate devalues over time when considered as an asset not that prices go down per se.

 

[rogueebear]

@buffalopat It only devalues on paper though. The property can maintain its physical value, by it sitting on a desirable piece of land (usually location dependent, such as a big tier city, or tourist destination)

I.e just because a house is worth X on paper doesn’t mean you have to sell it for X.

It would usually require you to own the land it sits on though.

 

[buffalopat]

@rogueebear The house can maintain value even over 30 years? That’s surprising I always heard houses became essentially worthless over decades and that only the land - maaaaybe- held its value as long as the area had people moving in. Or if Tokyo then it could go up 5% or something???

 

[rogueebear]

@buffalopat It’s on paper value decreases. But It can still hold physical value. As in if some wealth domestic/overseas investor really wants to buy your house you can charge whatever you want for it.

I.e just because it’s worth ¥(x) doesn’t mean you have to sell it for ¥(x). It all depends how desirable the property is (which is usually determined by the desirability of the land it sits on)

 

[buffalopat]

@rogueebear Ah ok I got your meaning. Wish some mega rich Chinese investors would roll up to my place with a blank Cheque! Haha

 

[rogueebear]

@buffalopat Well not exactly like that haha. But I mean that could happen. But what I mean is when you put it on the market you can kinda decide what you wanna sell it for.

The only difficult thing is selling it for your desired price to people who need a loan. Because their loan providing bank also need to agree with the value you have given it

 

[heyitsthatguy1247]

@buffalopat for most people in reddit japan their unit of account is fiat currency, thus it is always goign up in value.

For those of us in bear assets as a unit of account, things have become 5 times cheaper in the last year

 

[plebeian]

@milagrace2018 Short answer is yes!

With the yen weak and rising cost of materials and imports, then "HELL YES!".

Major foreign investment happening in major cities right now then mate, we are going to the moon at this rate.

There's no point waiting.

 

[djson]

@milagrace2018 I've been buying up properties like crazy. (work in finance and earn USD)

 

[pauldevereux]

@milagrace2018 70m is dirt cheap. You should see prices here in Minato. Buy it if you like it.