Property prices in Japan are on the rise and the upward movement appears to be triggered in part by the significant spike in tourists’ inflow. A new report indicates the Japanese property market is witnessing a boost that likely will sustained for an extended period.
“Land prices in Japan are rising, and the trend is no longer confined to big cities,” the Nikkei Asian Review reported.
The government said property prices in Japan have been increasing in the past three years, tracing the growth since 2015. Land prices for commercial, industrial and residential use have been on a steady rise as of the end of 2017, the Nikkei news story added, citing a recent study issued by Japan’s Ministry of Land, Infrastructure, Transport and Tourism.
In the same report, authorities linked the increase on land prices to “a surge in foreign visitors.” The survey is upbeat that the upturn in the property sector will continue given that the demand remains high in the Japanese tourism industry.
The Japanese Appeal
Travellers to Japan, the report said, are willing to spend money in order to witness first-hand the country’s rich culture and get a taste of the country’s cultural events and performances. But there is one key attraction that seems to lure in hordes of visitors from China, the rest of Asia and Europe – skiing.
Nikkei said the winter sport has practically generated a sub-industry in the constantly flourishing Japanese tourism industry. As a direct result of the boom, the country’s property sector is currently headed to the expansion route.
Case in point is the ski resort city of Niseko, which has become a popular tourist destination for winter and all-season activities. At the end of 2017, the ski town posted an over 30 percent increase in land prices on commercial and residential areas, and the growth was the biggest seen lately in the Hokkaido prefecture.
Undeniably, the growth spurt that Niseko recorded in recent years was largely supported by the town’s ski resort facilities that became the favourite of affluent foreign visitors, many coming from Australia, Hong Kong and the mainland China.
Essentially, the Niseko tourism industry is firing up the local economy, the Nikkei report said.
“In Niseko, businesses catering to the needs of foreign visitors are springing up, further boosting land prices in the district and neighbouring areas. Some of those businesses are also foreign owned,” the publication reported.
One solid indicator of the exciting growth happening in Niseko and Hokkaido in general is the construction of condominium projects that prior to completion have already reserved buyers. In Kutchan, for instance, a condo unit can go as high as $900,000 but developers sell the property with relative ease.
That’s because Hokkaido is now in relative parity with other Japanese big cities in terms of real estate value, thus making investment moves in Niseko and nearby areas a rosy prospect.