Advantages of Japan’s real estate investment
The number of international travelers to Japan has seen a rapid increase for the last several years. These tourists spend quite a lot at department stores and retailers, boosting their sales. Their shopping spree is described as “explosive buying”, which has become a buzzword. It’s no exaggeration to say that overseas tourists make a large contribution to the Japanese economy. Most of the buyers with “explosive buying” habit are from Asian countries such as China, Taiwan, Singapore and Thailand. These tourists are most known to buy high-quality Japanese electronics, medicines, cosmetics, and brand items, but in fact properties are also very popular and purchased in an “explosive buying” manner.
Properties in Japan are relatively inexpensive compared to the ones in China, Hong Kong, Taiwan and Singapore, where property price has skyrocketed, making the yield lower than before. On top of that, the unit price in Tokyo is only 60% of that of other major cities in other countries, despite the fact that Tokyo has the third largest market in the world. Properties in Tokyo have become more popular investment targets.
Japan’s property is highly regarded by overseas investors for the below reasons. The popularity is likely to grow even more with the Olympic Games coming in 2020, experiencing an increase in workers and students from other countries, having lower cost of goods due to weak yen and establishing national strategic special zones, designated by the government. Overseas investors are not missing these trends.
- Size and fluidity of property market
- Stability of property investment related system
- Standard risk of property investment
- Stability of politics and economy
- Safe asset of yen, less susceptible to international financial crisis or corrupted government
Read on this article to learn popular investment properties in Tokyo for overseas investors.
Popular investment property areas in Tokyo
Minato-ku(港区)
Roppongi in Minato ward is highly recommended for foreign investors. Many international cooperations and embassies are gathered in this area, surrounded by upscale residential districts such as Hiroo, Shirokane and Takanawa, where hundreds of overseas residents live. These districts offer plenty of stylish cafes, restaurants and boutiques. Their location is also convenient, being close to major cities, including Roppongi, Ebisu and Omotesando.
Akasaka and Roppongi have dozens of expensive condominiums and integrated property developments, including the city’s landmark, Roppongi Hils. Among the commercial buildings, leading corporations are also established. If you’re from overseas, you may be concerned about language issues, but there is no need to worry. You can find international schools in Roppongi and English-friendly hospitals and restaurants are available. Minato is highly favored by a wealthy class and foreigners. When it comes to property investment, this area can produce a relatively stable yield.
Chiyoda-ku(千代田区)
Chiyoda Ward is located in the heart of Tokyo and serves as the hub for Japan's capital functions, hosting landmarks such as the Prime Minister's Official Residence, the National Diet Building, and the Supreme Court, among others. Moreover, the Marunouchi area to the west of Tokyo Station stands as Japan's largest business district, housing major corporations and financial institutions, thus playing a pivotal role in Japan's economy.
With numerous upscale residential areas, Chiyoda Ward attracts government officials and business leaders, ensuring a relatively stable demand for rental properties due to the significant presence of individuals engaged in government-related work and business activities.
Chuo-ku(中央区)
Chuo Ward is located near the center of Tokyo's 23 wards and is characterized by its small size. Together with neighboring Chiyoda Ward and Minato Ward, it forms part of Tokyo's 'Big Three' central wards, with many businesses having their offices here. Additionally, with bustling areas like Ginza and Nihonbashi, along with numerous commercial districts and office spaces, this ward attracts a significant number of tourists from abroad.
Chuo Ward is known for its abundance of commercial areas, leading to relatively high rental incomes. Therefore, from an investment perspective, this area is quite attractive.
Koto-ku(江東区)
Unlike the first two areas, Koto ward has a good combination of residence, shopping, sightseeing and nature, despite its central location. Especially the land price of Toyosu has been on the increase because several Olympic Games will be held in the area. Along with infrastructure development, a rush to build condominiums has been continued. Many foreigners are eager to buy condominiums in the area. Popular tourist spot, Tsukiji fisher’s market is going to be transferred to Toyosu. After the relocation, Toyosu will become a new tourist spot as the center of Japanese food culture. The popularity of this area will be sustained even after the Tokyo Olympics. This is a great place to invest in.
Sep 15, 2017
