On April 30th, The Ministry of Land, Infrastructure, Transport and Tourism (MLIT) released updated nationwide housing start data for the fiscal year 2023.
Fiscal year 2023 spans from April 1st, 2023 to March 31st, 2024.
In FY 2023, there were 801,760 newly constructed housing starts, marking a 7.0% decrease compared to the previous fiscal year, continuing the trend of decline for the second consecutive year.
Broken down property type:
Property Type | No. of FY 23 Starts | % Change from FY 22 |
Custom-Built SFH | 219,622 | 11.5% down |
Rental Housing | 343,950 | 2.0% down |
Strata-Title* | 235,041 | 9.4% down |
*Strata-title starts includes both condo and sub-divided SFH starts
Custom-made single-family home (SFH) starts decreased for the second consecutive year to 219,622 units, representing an 11.5% decline.
Rental housing starts also saw a decrease for the first time in three years, totaling 343,950 units, down by 2.0% from the previous year.
Nationwide strata-title starts decreased for the third consecutive year, totaling 235,041 units, reflecting a 9.4% decrease.
Within the overall strata-title number, condo starts dropped by 12.0% from the previous year and sub-divided SFH starts dropped for the first time in three years to 133,615 starts, marking a 7.6% decline.
The Greater Tokyo Area saw a total of 286,709 starts, a decrease of 5.2% compared to the previous year.
This includes 46,860 custom-built SFH starts, down by 11.8%, 138,080 rental units, down by 0.5%, and 108,030 strata-title starts, down by 7.4%.
The GTA consists of Tokyo, Kanagawa, Saitama and Chiba prefectures.
Why are housing starts important?
The term 'housing starts' signifies the initiation of construction on a new residential property.
As a significant investment in capital goods, the commencement of new housing projects not only stimulates consumer spending on household appliances and furnishings but also serves as a key economic indicator closely monitored by participants in financial markets.
The vitality of the housing sector significantly influences employment and commodity prices, including those of lumber and copper.
Housing starts serve as an indicator of builders' confidence in investing resources into new projects. This confidence is influenced by their assessments of housing demand, making the trend in housing starts a valuable insight into risk appetite and consumer sentiment.
Sources:
R.E. Port News (Japanese only)
Ministry of Land, Infrastructure, Transport and Tourism (Japanese only)
