Japan Land Prices Rise for Fifth Consecutive Year

The average price of land in Japan as of July 1 increased for the fifth straight year, according to government data released Tuesday. The nationwide overall average rose by 1.5 percent, which is the same pace as the previous year and the sharpest increase since the burst of the asset price bubble in the early 1990s. Commercial land prices rose 2.9 percent due to strong demand for hotels and shops, while residential land prices gained 1.0 percent.

A widening disparity exists between major metropolitan areas and the rest of the country. Prices in Tokyo, Osaka, and Nagoya rose 4.4 percent, whereas growth in other regions remained flat at 0.4 percent. In four major cities outside the three metropolises, including Sapporo, Sendai, Hiroshima, and Fukuoka, the growth rate slowed to 4.1 percent. The Ministry of Land, Infrastructure, Transport and Tourism noted that buyers in some of these cities scaled back purchases due to rapid price increases and rising labor and material costs.

Tourism has significantly influenced specific locations. Residential land in Furano, Hokkaido, rose by 32.0 percent, and commercial land in Hakuba, Nagano Prefecture, rose by 35.6 percent. Both areas are popular ski resorts for overseas visitors. Additionally, the Asakusa district in Tokyo saw significant gains. The Meidi-ya Ginza commercial building site in Tokyo recorded the highest price per square meter in the country at 52.5 million yen, marking the 21st consecutive year it has topped the list.