Second-hand apartment prices are slowly recovering. As they are comparatively cheaper than brand new apartments, demand is returning and the viewpoint that this is no longer the bottom of the market is emerging.
Nagoya’s 7 cities see the highest increase of 2.7%
Real estate information provider, Tokyo Kantei, reported that the average price of a 70sqm apartment in Tokyo’s 23 Wards reached 42.97 million Yen in March, 2010. This is 9% higher than the bottom average price that was recorded in June, 2009.
From Autumn of 2009, Tokyo, Yokohama and Saitama have been showing signs of transitioning into a bullish market. Nagoya’s 7 cities had the largest rate of growth of 2.7% compared to the previous month, with Osaka and Kobe seeing almost no change.
The reluctance to purchase apartments is starting to ease up. Due to the supply of newly constructed apartments in Tokyo decreasing, people are shifting their focus to relatively cheaper second-hand apartments in good locations.
An official from the market research division of the Tokyo Kantei says the market has hit the bottom, however, the market has yet to rise strongly.
Tokyo’s 6 Wards that are especially sensitive to business conditions (Chiyoda, Chuo, Minato, Shinjuku, Bunkyo and Shibuya) are seeing slow increases in apartment prices. For a more clearly defined increase, the economy (obviously) needs to see a recovery.
Major City Apartment Prices
Average price for a 70sqm apartment
Tokyo’s 23 Wards:
Feb ’10 42,600,000 Yen
Mar ’10 42,970,000 Yen
Feb ’10 26,430,000 Yen
Mar ’10 26,480,000 Yen
Feb ’10 16,850,000 Yen
Mar ’10 17,040,000 Yen
Feb ’10 21,210,000 Yen
Mar ’10 21,120,000 Yen
Feb ’10 22,000,000 Yen
Mar ’10 22,240,000 Yen
Feb ’10 19,000,000 Yen
Mar ’10 18,920,000 Yen
Feb ’10 17,920,000 Yen
Mar ’10 18,290,000 Yen
Source: Nikkei Shimbun, May 10, 2010.