The average sales price of a newly built apartment in the greater Tokyo area was ¥67,500,000 ($596,000 USD) in October. This was an annualized increase of 10.1% and an increase of 2.5% compared to September.

Average selling price per square foot was ¥1,057,000 ($9,327 USD), a 10.9% year-over-year increase and the fourth consecutive month of year-over-year increases.

The greater Tokyo region consists of the Tokyo 23 Wards, the western suburbs of Tokyo, and Kanagawa, Saitama, and Chiba prefectures.

Selling prices in the Tokyo 23 Wards fell 1.8% year-on-year in October to ¥84,550,000. This was a reversal from September, when average selling prices rose 24.3% year-on-year to 86,070,000.

After the initial COVID emergency, developers began withdrawing new offerings from April and May last year. Throughout the rest of 2020, tight supply, coupled with continued historically low mortgage rates, continued to push prices up. Steady upward growth in average selling prices is a notable feature of the larger Tokyo new apartment market.

Developers released a deluge of inventory in the first half of 2021, a 77.3% year-on-year increase for the Tokyo capital as a whole. Nevertheless, the supply is lagging behind the demand. The average sales price in the metropolitan region fell by only 3.9% in the first six months of the year, compared to the increase in supply of 77.3%. Here is the breakdown by prefecture for the first half of 2021:

In October, we saw a 38.8% year-on-year decline in new supply, with 2,055 new-build apartments entering the market. This was the second consecutive month in which supply fell year on year. As mentioned above, the average sales price in the capital increased by more than 10%, despite the slump in new stocks.

For the Tokyo region as a whole, the contract rate for October was 71.4%, up 1.0 point year-on-year and up 3.7 points from September. The contract rate is the number of units for sale divided by the number of units for sale. A contract rate of more than 70% would indicate strong buyer interest towards the offer.

Tokyo has had a strong buyer’s market for most of 2021. Contract rates for March, April, May, June, July and August were 73.6%, 73.6%, 69.3%, 72.5%, 68.3% and 73.0%, respectively. For the first six months of the year, the contract rate for the capital of Tokyo averaged 72.5%.

Average sales price of an apartment in Tokyo – by city and prefecture

Here is the breakdown of the average sales prices by area for October 2021 compared to September 2021 and on an annualized basis.

Source: Real Estate Economic Research Institute (Institute for Economic Research Real Estate)

Average sale price per square meter of an apartment in Tokyo – by city and prefecture

Here is the breakdown of the average sales prices per square meter by area for October 2021 compared to September 2021 and on an annualized basis.

Source: Real Estate Economic Research Institute (Institute for Economic Research Real Estate)


sources:

REEI, October 2021 Tokyo New Condominium Market Trends Report (PDF in Japanese)

REEI, September 2021 Tokyo New Condominium Market Trends Report (PDF in Japanese)

REEI, October 2020 Tokyo New Condominium Market Trends Report (PDF in Japanese)

Main photo: Fall in Tokyo Ginza via iStock 627327516


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