Average condo price in Japan hit record high in 2022

Tokyo, Feb 22 The average unit price of new condominiums across Japan hit a record high of 51.21 million yen ($382,000) in 2022, topping the previous record for the sixth year in a row, a think tank report revealed.

The figure grew 0.1 per cent from the previous year due to surging costs of construction materials chiefly reflecting the yen's weakening as well as an upward trend spurred by the popularity of properties located near train stations, the Real Estate Economic Institute said in its report.

For 2023, the institute projected that the trend could accelerate amid high-end condo projects in Tokyo and surrounding areas, Xinhua news agency quoted the report as saying.

In Tokyo and the three neighbouring prefectures of Kanagawa, Chiba and Saitama, the average unit price of new condominiums was up 0.4 per cent last year to 62.88 million yen, while new condo supply slipped 12.1 per cent.

However, analysts said that current low interest rates on housing loans, which have supported demand, are likely to be affected by a potential policy shift at the Bank of Japan after a new governor takes over in April.

If floating mortgage rates rise, it could make people reluctant to purchase, said an official at a major real estate developer.