Post: Tuesday October 8, 2013
On Sept.19 Ministry of Land, Infrastructure, Transport and Tourism announced the standard land price.
The standard land price is the price of land per 1 square meter that is evaluated for each selected point of land as of July 1st. It is one of the two major representative data that shows the fluctuation of land price along with the official land price that is announced on Jan.1 every year.
Due to hints of an economic recovery, the average rate of the land price in Tokyo has turned around from downward to upward both for residential and commercial areas for the first time in 5 years. At the 1,268 selected points of land in Tokyo, an increase in price has been calculated at 715 points of land, and also the average rate of price fluctuation for all the selected points in Tokyo came out at +0.5% (compared to -0.7% last year).
Within the 23 wards of Tokyo, the average rate of land price went up in 22 wards (all except Katsushika-ku). The highest rise was in Chiyoda-ku, 3.1% the 2nd highest was 2.7% in Minato-ku, and the 3rd highest was 2.3% in Chuo-ku. The highest land price point in Tokyo is 6-1, Rokubancho, Chiyoda-ku; the same as last year and the price is 2,880,000Yen per 1 square meter (compared to 2,780,000Yen last year). Other examples of high rate of price rise in the 23 wards are: areas around JR Shinagawa and Osaki stations where active redevelopment projects are going on (+6.3% in 5 Chome, Kita-shinagawa), the area of Roppongi, Minato-ku (+5.8% in 5 Chome, Roppongi), and the area of Minami-Aoyama (+4.0% in 4 Chome, Minami-Aoyama, Minato-ku), these are all very popular areas in Tokyo.
The area around JR Shinagawa and Osaki stations where many office buildings and high rise condominiums are had the highest rate of rising prices. Osaki, designated as one of the 7 “fukutoshin” or sub city-centers by the Tokyo metropolitan government, has been going through a rapid transformation from a town of warehouses and factories to a town of “Dining, Housing, Learning, and Play”. The area also boasts easy access to Haneda Airport (16 minutes) and Narita Airport (1 hour).
Redevelopment projects are expected to be active in the area around Shinagawa which will be the end station for the Linear Chuo Shinkansen planned for completion in 2027.
In 5 Chome of Kita-shinagawa, a large scale redevelopment project of 3.6ha is going on and a total of 7 buildings are under construction for completion in 2015 including a 40-story high rise residential building and a 31-story office building.
The Shinagawa ward is aggressively pursuing a progressive plan for assisting child rearing and young families and that is encouraging the inflow of younger generation families in result leading to active purchase of condominiums in the ward.
The Roppongi area came 2nd in the rate of rising prices, with the just completed “ARK Hills South Tower” in Sept.2013 heading the redevelopment projects going on in the area. The area has seen a series of projects such as Roppongi Hills in 2004, Tokyo Midtown in 2007, and Ark Hills Sengokuyama Mori Tower in 2012. The area is officially designated as “Tokyo's Special Zone for Asian Headquarters” by the Tokyo metropolitan government for the purpose of attracting foreign companies. Currently there are multiple development projects including the west zone of Roppongi 5 chome in progress aiming to make Tokyo the International city center in Japan.
In time with the land price rise of the Roppongi area, PLAZA HOMES got interviewed by a television station about the most current market trends.
We have answered and commented about an increase in investments for high-end properties of 100-200mil yen by affluent clients from overseas as the demand for office, commercial, and residential properties are increasing due to the rapid progress of redevelopment in the area.
Within the 23 wards of Tokyo, the average rate of land price fluctuation was +0.8 %( compared to -0.8% last year), increasing in 22 wards all except for Itabashi-ku. The highest rate was 1.6% in Minato-Ku, the 2nd highest was 1.5% in Toshima-ku, and the 3rd highest was 1.4% in Bunkyo-ku and Meguro-ku. According to the Tokyo metropolitan government, the demand for opening stores is going up in areas close to major hub stations.
The highest price point in Tokyo is the “Meijiya Ginza Building” at 2 Ginza, Chuo-ku; this is the same as last year and the price is 20,400,000Yen per 1 square meter (compared to 19,700,000Yen last year). The highest rate of price rise in the 23 wards is the shopping street of Asakusa 1-Chome, Taito-Ku, where the nearby Tokyo Sky Tree attracted an increase in tourism and resulted in a +5.3% increase. The announcement of the land price this time is based on an evaluation conducted in July, which doesn’t include the influence of hosting the Tokyo Olympics in 2020. Next year it is possible that the prices of the Tokyo Bay area where many Olympic related facilities are planned to be built will rise significantly. Especially the prices of condominiums around the Bay area are currently soaring. It is expected that the rate of price rise will stay high in the areas around Daiba, Toyosu, and Tokyo’s National Stadium where Olympics related renovations will be actively progressing.