The External Factors Driving Japanese Real Estate


Japan has a shrinking, 0ld population, a relatively soft economy, and a plethora of available real estate. That would normally lead you to believe real estate values should be trending downwards, right? Wrong.

Low interest rates, moderate to high rental yields, and the prospect of rising values ahead of the 2020 Olympic Games have suddenly put Japanese property back in the spotlight. Far from the days when the Imperial Palace was said to be worth more than all the real estate in California, Japan’s real estate is relatively affordable when compared to other major global markets such as Hong Kong, San Francisco, and New York.

The yen recently sank to a 22-year low against the yuan, leading to an explosion of Chinese investors looking to the Land of the Rising Sun as a great real estate investment. Couple that with the approaching 2020 Olympics (which, statistically, always leads to a surge in real estate values), and it’s not hard to see why now is a great time to invest in Japan.

The real estate market in Japan is not only shaking off the dirt from its free fall in the 1990’s, it is getting downright hot again. If you’re into reading dozens of pages of research and analysis like I am, take a look at this report from the All Japan Real Estate Association about the relationship between the Olympics and Real Estate values in the Japanese market.