Temporary upswing in real estate market in Sendai

The 2011 rosenka land valuations released by the National Tax Agency on July 1st showed a decline in land prices across Japan for the third continuous year. Concern is rising, however, over a large scale crash in prices in areas of Northern Japan that were affected by the Tsunami and Fukushima Daiichi Nuclear Power Plant where real estate transactions have almost ceased.

Sendai City, on the other hand, is experiencing a hike in emergency demand from displaced residents.

A 40-yr old resident of Sendai’s Wakabayashi-ku who lost her home in the Tsunami had visited real estate agencies almost everyday before finally finding her family of four an apartment for 70,000 Yen a month. “I heard that rents were rising, but I’m glad that I found a place for a moderate price” she remarked.

According to local real estate agents, there was an immediate increase in inquiries from displaced residents for both rental and sale properties. In some cases, buyers had suddenly snatched up apartments that had remained unsold for the past 10 years. Agents believe that prices have gone up by 10~20%, so an apartment with a pre-disaster rent of 100,000 Yen a month would now rent for 130,000 Yen a month and residential land listed for sale at 14 million Yen could now sell for 16 million Yen.

The Tohoku Office of the Japan Real Estate Institute expects the sudden rise in demand caused by the disaster to settle down in the long term.

Source:
The Yomiuri Shimbun, July 1, 2011.