INTRODUCTION

The for-sale condominium market in the Tokyo 23 Wards (23W) has gone from strength to strength, with prices rising to new highs. Supply levels entering 2024 are at particularly low levels, while housing demand has risen due to the growing population, affordable interest rates, and stronger wage growth, on top of the fact that rental units larger than 70 sq m are scarce, meaning that family households typically resort to the for-sale market. At the same time, elevated construction costs, increased land costs, and the difficulty of securing labour have driven up costs for developers, suggesting that for-sale condominiums prices will remain high.

At the same time, there is some level of bifurcation appearing in the market. Condominiums in prime central areas have seen demand skyrocket on the back of both domestic and foreign HNWIs (High Net Worth Individuals) who see such purchases as investments. On the other hand, condominiums in areas with poor access are reported to have seen price corrections even under the present bullish market. Location will continue to play a key role in determining pricing going forward.