New apartment starts in 2017 reach lowest level in 7 years

Apartment starts in the greater Tokyo area in 2017 reached the lowest level seen in seven years. According to the Ministry of Land, Infrastructure, Transport and Tourism (MLIT), apartment starts were 57,591 units, down 12% from 2016. The Ministry cites an early rush by developers to get large-scale projects off the ground in the lead up to the 2020 Olympics and difficulty in securing sites for residential developments as the two contributors to a recent slow down in residential construction.

Tokyo saw the biggest year-on-year decline with a drop of 15% from 2016 to 35,888 units last year. Kanagawa and Saitama prefectures also saw declines of 13% and 10%. Chiba prefecture, meanwhile, saw an increase of 11%.

Since 2011, the greater Tokyo area has seen annual apartment starts ranging from 60,000 ~ 70,000 units. Much of the extra supply can be attributed to major apartment building projects centered on Tokyo’s bayfront districts including Toyosu and Harumi.

Housing starts in greater Tokyo across all types (detached homes and apartments) was down 4.6% from 2016. Nationwide, housing starts were down 2.8%, the first decline in three years.

Apartment starts in greater Tokyo for the month of March 2018 were 3,850 units, down 16% from the previous year and the seventh month in a row to record a year-on-year decline.

Sources:
MLIT, April 27, 2018.
The Nikkei Shimbun, May 3, 2018.