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Official Average Roadside Land Prices of Tokyo 2017 Japanese of this page

Post: Friday July 7, 2017

On July 3rd the National Tax Agency released the average roadside land price in 2017 (as of January 1st). The national average price has risen 0.4% from the last year, which is 2 years consecutive rise and 0.2% increase of price rise rate. It shows the price has risen in 13 Prefectures including Tokyo, Osaka, and Aichi, and 10 Prefectures including Hokkaido, Miyagi, Hiroshima, and Fukuoka have had the price rise more than that of last year . The average price rise in Tokyo from the last year has marked 3.2% (2.9% last year) resulting in 4 years of consecutive increase in price.

Roadside Land Prices in Tokyo 2017

By comparison of all the prefectures in Japan, Miyagi has marked 3.7%, the largest increase from the last year, and Tokyo and Okinawa have followed by 3.2%. Miyagi’s increase has mostly resulted from the start of the operation of Sendai Subway Tozai Line; Tokyo’s increase from many redevelopment projects on-going and planned towards 2020 Olympics; and Okinawa’s increase from the growth of population. In Tokyo the highest roadside land price in an area covered by a local tax office has risen at 46 points out of a total 48 points. Only at 2 points the price rise has remained flat and the rate fall has shown zero for the past 4 consecutive years. Steady office demand and an increase of foreign visitors have pushed up land prices in Central Tokyo including Ginza and Shinjuku.

The highest roadside value nationwide is 40,320,000Yen per square meter in front of the store “Kyukyodo” on Ginza Chuo-Dori Street in Chuo ward, Tokyo. This has been the highest priced space in Tokyo for 32 consecutive years and has gone up over the past highest 3,650,000Yen per square meter in 1992 right after the bubble economy. The rate of rise in Ginza has marked 26.0% which is the highest rise in Tokyo compared with the previous year. Renovation and redevelopment works are active in Ginza responding to increasing foreign visitors. In other areas of Central Tokyo construction of new hotels and luxurious condominiums are on-going actively. The recent trend of companies’ returning to the center of Tokyo is supporting steady office demand in Central Tokyo especially in Shibuya, Otemachi, and Nihonbashi.

Land price rise in Tokyo has mostly come from active development of commercial facilities and hotels responding to an increase of foreign travelers and introduction of the negative interest rate by the Japanese government. The other factor has reportedly come from an increase of foreign investment for buying condominiums and tower buildings in Central Tokyo. Compared to unpredictable US economy managed by the President Trump administration and unstable UK economy having trouble caused by the secession from the European Union (EU), Japanese economy is relatively stable and attracting investors from Europe, U.S.A. and China taking advantages of weak Yen as well. Such foreign investors are pouring their money intensively to the area in Tokyo with strong brand power such as Ginza, and Japanese investors including stock brokerage firms, life insurance companies, non-life insurance companies, and real estate companies are also buying many properties for their investment. These investment moneys like to buy the properties of building with land which may gain a profit quickly, and then such purchased properties are sold in 3-5 years when the properties’ prices go up.

There is a voice of caution in the real estate market about such a remarkable rise of land price in Tokyo. There is a forecast that the rate of land price rise will go slow soon and there is another viewpoint that the rent price has been reaching close to its peak since the beginning of this year. Actually there is a sign of change in the residential properties that sales of expensive newly built condos in the Bay Area are slowing down and result in showing not a few vacancies. Hence price of old apartment is also becoming weak and some of such old property prices are going down. About the commercial properties there is also a concern that many retail stores and restaurants will soon have difficulty for gaining healthy profit as the rent and property tax are increased more than now. While having such voices of caution in the market, further land price rise is anticipated in Ginza area attracting foreign tourists and in Toranomon area changing to the international business hub.

Highest Roadside Value in major Tokyo tax office in 2017

(Per square meter per 1000Yen, the rate rise in % shown in parentheses, in order by tax office)
Local tax officeRoadside NameRoadside Value
1. Kyobashi

5-Chome, Ginza, Chuo-Ward
Ginza Chuo-Dori Street

40,320
(26.0)

2. Shinjuku

3-Chome, Shinjuku, Shinjuku-Ward
Shinjuku-Dori Street

24,480
(14.2)

3. Kojimachi

2-Chome, Marunouchi, Chiyoda-Ward Daimyoukouji Street

23,950
(6.4)

4. Yotsuya

3-Chome, Shinjuku, Shinjuku-Ward
Shinjuku-Dori Street

22,800
(16.3)

5. Shibuya Udagawa-cho, Shibuya-Ward, Shibuya Station Side Dori Street

21,600
(15.9)

6. Nihonbashi

1-Chome, Yaesu, Chuo-Ward
Sotobori-Dori Street

17,600
(8.4)

7. Azabu

3-Chome, Kita-Aoyama, Minato-Ward
Aoyama-Dori Street

11,680
(20.7)

8. Shiba

2-Chome, Shimbashi, Minato-Ward
Shimbashi Station West-exit Square Dori Street

11,360
(11.8)

9. Toshima 1-Chome, Higashi-Ikebukuro, Toshima-Ward Green-Odori Steet

8,980
(12.1)

10. Kanda

4-Chome, Sotokanda, Chiyda-Ward, Chuo-Dori Street

7,100
(10.6)

(Source: 2017/07/04 NIKKEI Newspaper)

What is Average roadside land price?

Standard price as of January 1 per square meter facing major streets - released by the National Tax Agency. The price is used as a standard for calculating inheritance taxes and gift taxes. The number of locations priced for the Average roadside land price is much more than for the standard land price that is announced by Ministry of Land, Infrastructure, Transport and Tourism, and so the average roadside land price provides a more detailed picture of the real market land prices. It is at around an 80% price level of the standard land price in general and actual business transactions are calculated in the average roadside land price.

Real estate pricing in Japan - 6 different land prices
>> /news/6-different-land-prices/

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