(Yes, this is a Tokyo centric thread, please spare the “who cares / life is much better elsewhere” replies).
By central central I mean inside the Yamanote or just adjacent to it (west Shinjuku, Shinsen, Daikanyama, Tabata etc).
The post-Bubble couple of decades in which a small detached house (still the preferred type of residence for most Japanese) in central Tokyo was accessible to a middle class family (say household income of 7-8 million, borrowing 50-60 million) are coming to an end - maybe you can still find a tiny handful of detached houses inside the Yamanote for that budget - and it seems pretty likely that prices are going to continue an upward march, even factoring in some modest BoJ rate rises.
Tokyo real estate is now becoming a global asset class in the same way as London / NY (in fact in terms of affordability relative to income the city now ranks behind these). With the weak yen money is pouring into central property, especially from elsewhere in Asia.
Also as the city becomes more high-rise the amount of land available for single-family homes is decreasing (and several wards including Setagaya have imposed minimum plot sizes to make it harder to build). Try and get anything under 1-2 oku in Minato now, that isn’t on borrowed land or a postage stamp plot - it’s impossible.
That said I’m interested in people’s thoughts on areas of the city which still seem undervalued, relative to location / QoL. As an example, Bunkyo-ku was clearly undervalued (given its proximity to the city centre and leafy atmosphere) 10-15 years ago, but now is insane with even cramped used homes over 1 oku, same as Minato-ku.
My thoughts - I would bet on Toshima ward being the “next Bunkyo”, especially inside the Yamanote line, due to centrality / popularity with students / fairly pleasant atmosphere. Also the swathe north of Shinjuku around Takadanobaba, Totsuka and Okubo has some potential for price growth. Yanaka area has some bargains still, if you are willing to do some renovation (the stock is very old in that area). Ochiai, Komagome also seem undervalued. (There are some areas like Uguisudani which are undeniably cheaper but which I think will struggle to shed the sleazy reputation). In the south…perhaps around Gotanda which has become a bit more gentrified recently (although already expensive because of proximity to Ebisu / Meguro).
By central central I mean inside the Yamanote or just adjacent to it (west Shinjuku, Shinsen, Daikanyama, Tabata etc).
The post-Bubble couple of decades in which a small detached house (still the preferred type of residence for most Japanese) in central Tokyo was accessible to a middle class family (say household income of 7-8 million, borrowing 50-60 million) are coming to an end - maybe you can still find a tiny handful of detached houses inside the Yamanote for that budget - and it seems pretty likely that prices are going to continue an upward march, even factoring in some modest BoJ rate rises.
Tokyo real estate is now becoming a global asset class in the same way as London / NY (in fact in terms of affordability relative to income the city now ranks behind these). With the weak yen money is pouring into central property, especially from elsewhere in Asia.
Also as the city becomes more high-rise the amount of land available for single-family homes is decreasing (and several wards including Setagaya have imposed minimum plot sizes to make it harder to build). Try and get anything under 1-2 oku in Minato now, that isn’t on borrowed land or a postage stamp plot - it’s impossible.
That said I’m interested in people’s thoughts on areas of the city which still seem undervalued, relative to location / QoL. As an example, Bunkyo-ku was clearly undervalued (given its proximity to the city centre and leafy atmosphere) 10-15 years ago, but now is insane with even cramped used homes over 1 oku, same as Minato-ku.
My thoughts - I would bet on Toshima ward being the “next Bunkyo”, especially inside the Yamanote line, due to centrality / popularity with students / fairly pleasant atmosphere. Also the swathe north of Shinjuku around Takadanobaba, Totsuka and Okubo has some potential for price growth. Yanaka area has some bargains still, if you are willing to do some renovation (the stock is very old in that area). Ochiai, Komagome also seem undervalued. (There are some areas like Uguisudani which are undeniably cheaper but which I think will struggle to shed the sleazy reputation). In the south…perhaps around Gotanda which has become a bit more gentrified recently (although already expensive because of proximity to Ebisu / Meguro).