Japan Luxury Residential Real Estate Market Size (2024 - 2029)

Japan Luxury Residential Real Estate Market Analysis

The Japan Luxury Residential Real Estate Market is expected to register a CAGR of approximately 3% during the forecast period 2022-2027.

Since the pandemic began, people have been spending more time at home and consequently saving more to some extent. This lifestyle change has led to heightened housing demand, particularly for high-end properties, overall resulting in asset prices rising on a global level. Japan is no exemption, although the impacts of the pandemic have been relatively milder.

The world is gradually returning to normalcy, and international travel has been slowly resuming. While the reopening of international travel on a large scale still appears out of sight, luxury travel should come back much earlier. This timely resurgence in luxury travel should further fuel demand in the luxury sector. Ultra-luxury residences are gaining traction in Japan, and the sector is growing at an unprecedented pace.

Some of the large-scale mixed-use projects in the pipeline are expected to add more units in this category, which should expand the market size and push top prices even higher. The high concentration of ultra-wealthy people in Tokyo and the stability of Japan's long-term prospects make it attractive to overseas buyers and are factors that support the growth of this sector. Japan's rich culture is another attractive attribute, and the growth of the luxury hotel market should serve as a tailwind for the ultra-luxury residential sector.

The condominium market across Japan has changed greatly over the past two decades. In the greater Tokyo area, the annual supply of new condominiums across all price ranges is still sitting at about a third of the peak supply seen in 2000, while the average price has increased by around JPY 20 million to JPY 60 million. In Tokyo's 23 wards, the average price of a new apartment is JPY 77 million.

Japan Luxury Residential Real Estate Industry Segmentation

Prime location, high-end interior finishes such as marble countertops, professional-quality kitchen appliances, customized closets, and hotel-like amenities such as concierge services, a top-of-the-line fitness center, and a spa center are often staples of a luxury building. The luxury residential real estate market in Japan is segmented by type and by city. By type, the market is segmented into apartments and condominiums, villas, and landed houses. By cities, the market is segmented into Tokyo, Kyoto, Osaka, and other cities.