The supply of brand new apartments in Kyoto City in the first half of 2017 increased by 21.7% from the same period in 2016, while the average sale price saw a steep drop of 24.1% to 43,280,000 Yen. The reason for the decrease in the price was due to intense competition for hotel development sites in the city center which has forced apartment developers to shift their focus to the city’s outskirts where prices are cheaper.
In the first half of 2016, a number of luxury condominiums were offered for sale in Kyoto, pulling up average sale prices. However, with tourist numbers continuing to rise, sites that were originally slated for residential projects are now being converted to hotels which can provide better returns. This has also pushed up land prices.