Exploring Real Estate Trends in Tokyo's Residential Areas

Tokyo, a bustling metropolis known for its unique blend of modern and traditional architecture, presents a dynamic real estate market. Areas such as Minato, Chiyoda, and Shibuya are at the forefront, displaying significant real estate activities with varying prices and trends. This report delves into the intricate details of Tokyo's real estate market, providing insights into transaction prices, median prices per square meter, and how these have evolved over the years, offering investors a comprehensive outlook on investing in Tokyo.

Photo of Tokyo
Photo of Tokyo
Photo of Tokyo

Ratio of population of foreigners (per 100,000 persons)

3441

Aging index

208.6

Rate of population change

0.2%

Yearly average of air temperature

16.4

Yearly average of relative humidity

70%

Yearly clear days

29

Number of elementary schools (per inhabitable area 100 km2)

93.27

Number of lower secondary schools (per inhabitable area 100 km2)

56.3

Number of upper secondary schools (per inhabitable area 100 km2)

30.15

Percentage of persons employed

96.4%

Unemployment rate (Both sexes)

3.6%

Percentage of owned houses

45%

Number of retail stores (per 1,000 persons)

6.2

Number of eating and drinking places (per 1,000 persons)

4.75

Number of department stores and general merchandise stores (per 100,000 persons)

0.84

Number of traffic accidents (per 100,000 persons)

214.9

Number of recognitions of criminal offenses (per 1,000 persons)

5.37

Amount of damage by disasters (per capita)(30 years average)

¥152

Areas in Tokyo

AreaMedian Price per m²Growth over last 5 years
Minato Ward

¥1,480,000

27.2%

Chiyoda Ward

¥1,395,652

26.9%

Shibuya Ward

¥1,370,329

26.9%

Chuo Ward

¥1,252,273

22.6%

Meguro Ward

¥1,157,894

20.2%

Shinjuku Ward

¥1,155,000

15.5%

Bunkyo Ward

¥1,152,941

23.5%

Shinagawa Ward

¥1,095,455

17.4%

Toshima Ward

¥1,050,000

23.5%

Taito Ward

¥1,000,000

20.0%

Sumida Ward

¥950,000

25.2%

Setagaya Ward

¥950,000

22.8%

Koto Ward

¥948,684

35.5%

Nakano Ward

¥933,333

24.4%

Musashino City

¥921,324

20.9%

Suginami Ward

¥866,666

15.9%

Ota Ward

¥866,666

21.3%

Kita Ward

¥840,000

26.0%

Mitaka City

¥777,777

34.3%

Arakawa Ward

¥744,444

29.1%

Koganei City

¥736,667

32.0%

Nerima Ward

¥716,718

21.6%

Itabashi Ward

¥712,500

29.5%

Chofu City

¥660,769

23.9%

Kunitachi City

¥642,105

24.0%

Kokubunji City

¥609,523

27.6%

Komae City

¥573,750

13.6%

Nishitokyo City

¥554,701

20.2%

Edogawa Ward

¥554,545

20.2%

Katsushika Ward

¥540,000

24.6%

Fuchu City

¥533,333

14.3%

Adachi Ward

¥522,222

30.6%

Kodaira City

¥520,000

20.0%

Akishima City

¥461,579

42.9%

Inagi City

¥459,340

3.9%

Tachikawa City

¥444,444

19.2%

Higashikurume City

¥437,647

22.5%

Higashimurayama City

¥415,789

23.4%

Hino City

¥400,000

5.7%

Machida City

¥375,714

7.3%

Tama City

¥360,000

7.2%

Higashiyamato City

¥352,941

9.2%

Hachioji City

¥342,857

19.6%

Hamura City

¥300,000

11.2%

Fussa City

¥271,428

3.8%

Akiruno City

¥257,142

17.4%

Oume City

¥231,548

19.6%

Over the years, Tokyo's real estate has witnessed fluctuating transaction prices. From 2005 to 2023, apartments experienced a steady increase from ¥21,000,000 to ¥32,000,000, while detached houses saw a rise from ¥52,000,000 to ¥58,000,000. This indicates a growing market with an upward trend, highlighting potential long-term gains for investors.

Median total transaction price

Apartment vs detached house over year of transaction

The median price per square meter offers a clearer vision of market trends. From 2005 to 2023, the price for apartments saw an impressive climb from ¥550,000 to ¥960,000, whereas houses hiked from ¥480,000 to ¥557,894. This pattern underscores a consistent rise in real estate value across Tokyo, making it an appealing option for investment.

Median price per m² over construction year

Apartment vs detached house over year of transaction

The depreciation of real estate with age in Tokyo presents a nuanced picture. Newer apartments and houses command higher prices, with a sharp decline as the property ages. However, after around 30 years, prices tend to stabilize, suggesting that while newer properties might offer immediate value, older properties maintain their worth over time, offering a different kind of investment opportunity.

Median price per m² by building age

Apartment vs detached house over age of building

Analyzing the median price per square meter based on the construction year cohort reveals intriguing insights. Apartments built between 2000-2005 fetched around ¥914,285 in 2005 and saw a notable increase to ¥1,052,631 by 2023. This trend reflects the premium placed on modern standards, particularly with respect to earthquake resistance, which can influence future pricing.

Median price per m² over construction year cohort

Actual price trend of Apartment built in specific years

Similar to apartments, houses also showcased a marked price variation depending on the construction year cohort. For houses built between 2000-2005, the median price per square meter increased from ¥542,857 in 2005 to ¥494,736 in 2023. The fluctuations suggest the combined effects of general market trends and the depreciating value of older constructions, indicating the importance of construction year in investment decisions.

Median price per m² over construction year cohort

Actual price trend of House built in specific years

Investing in Tokyo's real estate market presents a lucrative opportunity, with consistent price increases across newer properties and a stable market for older constructions. As shown, the value of properties varies greatly depending on various factors, including location, construction year, and property age. While newer properties offer growth potential and modern amenities, older properties provide lasting value, making Tokyo a diverse and dynamic market for investors. Understanding these trends and market dynamics is crucial for making informed investment decisions in Tokyo's vibrant real estate landscape.

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