Property prices in Niseko, a high-end ski resort haven in Hokkaido, Japan, have been increasing significantly over the few past years and a new report pointed to booming tourism activities as the chief driver of the growth. In Kogen Hirafusen Street, for instance, the recorded price gains reached an incredible 77.1 percent, according to a report by the Japan Times.
“The area saw the steepest price gain for the third consecutive year,” the publication said, adding that rising tourism in Hokkaido mainly fired up the increase in value of real estate in Niseko, which the report characterized as “a ski resort area popular with overseas tourists in Hokkaido.”
Foreign tourist arrivals boost property market
The Niseko model is a classic example of regional areas in Japan that decided to highlight their tourism attractions and saw success in the process.
“For regional areas that have few resources that attract tourists, it is necessary to set up an attraction to draw in people in and also to enhance the locale’s ability to promote its region,” the report quoted Takeshi Ide, chief analyst at real estate research company Tokyo Kantei Co., as saying.
The analyst likewise indicated that with the heavy influx of foreign tourists, as seen in Niseko, Hokkaido, it follows that the destination cities will witness considerable increase in property prices. And with tourism activities on the rise, which Ide said is projected to continue in the years ahead, other developments will not be far behind.
It is expected that construction of hotels and development of traffic networks on specific cities will accelerate as more foreign visitors continue to be lured in, the report said.
Rising Japanese properties
The rising property prices in Niseko, Hokkaido were part of the annual report furnished by Japan’s National Tax Agency (NTA), in which it was indicated that land prices in the country have been steadily growing in the past years. The value of property in Japan jumped by an average of 0.4 percent in the last 12 months leading to January 2017, the nation’s tax authorities said.
The same study also identified a premium land in front of the famous Kyukyodo stationery store in Tokyo’s Ginza shopping district as currently the most expensive property in Japan, valued at ¥40.32 million (roughly US$360,000) per square meter or posting a step up of 26 percent from January 2016.
And like the case in Niseko, Hokkaido, “tourism boom and the expectation of improved business conditions ahead of the opening in April of the Ginza Six mega-shopping complex nearby helped inflate the price in the upscale area,” says the NTA report.