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▼ Higher Land Prices Add To Signs Of Japan's Recovery From Pandemic
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The average land price in Japan rose 1.5 percent in 2023 from a year earlier for the second consecutive year of increase, government data showed Monday, adding to signs of the economy recovering from the coronavirus pandemic.
A recovery in prices for commercial areas led the overall trend, according to the data as of Jan 1, after the government eased COVID-19 measures, including immigration controls, stimulating hopes that businesses will be revived with the help of demand from foreign tourists.
Out of the 47 prefectures, 25, including Tokyo and Osaka, observed higher average land prices. That compares with the pre-pandemic level of 21 prefectures marked in 2020, the National Tax Agency data showed.
The agency's annual survey of prices per 1 square meter of land facing major roads is used to calculate inheritance and gift taxes. It is based on data compiled by the Ministry of Land, Infrastructure, Transport and Tourism and reflects land transactions.
Hokkaido topped the list of prefectures this year with a 6.8 percent increase, signaling growing demand for housing and commercial facilities in and around its capital Sapporo.
Fukuoka came in second with a hike of 4.5 percent, followed by Miyagi's 4.4 percent. Tokyo observed a rise of 3.2 percent and Osaka 1.4 percent.
Average prices dropped in 20 prefectures, meanwhile, with Wakayama seeing a decline of 1.2 percent, Fukui 1.0 percent, and Ehime 0.9 percent.
Land prices have increased along with soaring condominium and other property prices as more people now work from home after the pandemic and seek to relocate while banks keep borrowing costs low, said Osamu Nagashima, head of real estate consulting company Sakurajimusyo Inc.
If interest rates remain low, "demand will continue to outstrip supply significantly, and land prices will keep rising," Nagashima said.
But he also noted the recovery trend could be undermined if the current inflationary pressure in the overall economy leads to higher building material costs.
The survey also showed that among prefectural capitals, 29 cities saw land prices in their prime locations increase, up from the previous year's 15, with those in Okayama and Sapporo rising 9.3 percent and 8.4 percent, respectively, boosted by ongoing redevelopment projects in the areas.
The most expensive plot in the country was for the 38th straight year in front of the Kyukyodo stationery store in Tokyo's Ginza shopping district. It was appraised at 42.72 million yen per square meter, up 1.1 percent from the year before.
As in previous years, no values were assigned for land in areas designated as evacuation zones in Fukushima Prefecture following the 2011 nuclear disaster because of difficulties in appraising them.
© KYODO
A recovery in prices for commercial areas led the overall trend, according to the data as of Jan 1, after the government eased COVID-19 measures, including immigration controls, stimulating hopes that businesses will be revived with the help of demand from foreign tourists.
Out of the 47 prefectures, 25, including Tokyo and Osaka, observed higher average land prices. That compares with the pre-pandemic level of 21 prefectures marked in 2020, the National Tax Agency data showed.
The agency's annual survey of prices per 1 square meter of land facing major roads is used to calculate inheritance and gift taxes. It is based on data compiled by the Ministry of Land, Infrastructure, Transport and Tourism and reflects land transactions.
Hokkaido topped the list of prefectures this year with a 6.8 percent increase, signaling growing demand for housing and commercial facilities in and around its capital Sapporo.
Fukuoka came in second with a hike of 4.5 percent, followed by Miyagi's 4.4 percent. Tokyo observed a rise of 3.2 percent and Osaka 1.4 percent.
Average prices dropped in 20 prefectures, meanwhile, with Wakayama seeing a decline of 1.2 percent, Fukui 1.0 percent, and Ehime 0.9 percent.
Land prices have increased along with soaring condominium and other property prices as more people now work from home after the pandemic and seek to relocate while banks keep borrowing costs low, said Osamu Nagashima, head of real estate consulting company Sakurajimusyo Inc.
If interest rates remain low, "demand will continue to outstrip supply significantly, and land prices will keep rising," Nagashima said.
But he also noted the recovery trend could be undermined if the current inflationary pressure in the overall economy leads to higher building material costs.
The survey also showed that among prefectural capitals, 29 cities saw land prices in their prime locations increase, up from the previous year's 15, with those in Okayama and Sapporo rising 9.3 percent and 8.4 percent, respectively, boosted by ongoing redevelopment projects in the areas.
The most expensive plot in the country was for the 38th straight year in front of the Kyukyodo stationery store in Tokyo's Ginza shopping district. It was appraised at 42.72 million yen per square meter, up 1.1 percent from the year before.
As in previous years, no values were assigned for land in areas designated as evacuation zones in Fukushima Prefecture following the 2011 nuclear disaster because of difficulties in appraising them.
© KYODO
- July 4, 2023
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