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  • Writer's pictureAdam German

Nationwide residential construction starts decline for 5 straight months

On November 30th, The Ministry of Land, Infrastructure, Transport, and Tourism (MLIT) released the housing start statistics for October, 2023.


All percentages displayed are Year-on-Year results (YoY).  In other words, the percentage difference between October of 2022 and October of 2023.


 

Key Takeaways:


  • October 2023: Japan's housing starts saw a 6.3% decrease, marking nine months of continuous decline in total square meterage planned for construction.


  • Overall housing construction hit 71,769 units, with condos showing a 9.4% increase after a four-month decline.


  • Custom single family homes dropped by 17.2%, marking 23 months of consecutive decline; rentals decreased for three months straight.


  • The Greater Tokyo Area saw a 3.8% decline in total housing, while Chubu and Kinki areas experienced decreases as well.


  • Despite fluctuations, some segments like condos showed a temporary rise amidst the general decline in housing construction.


 

Compared to October of 2022, the number of nationwide housing starts totaled 71,769 units (a decrease of 6.3% YoY), continuing to decline for five straight months. 


October 2023’s floor area of housing starts totalled to 5,451,000 square meters (a decrease of 9.6% YoY), marking a decline for the ninth consecutive month. 


In terms of housing type, custom single family homes (SFH) numbered 18,078 units (a decrease of 17.2%, marking a decline for 23 consecutive months). 


Rental units totaled 31,671 units (a decrease of 1.0%, marking a decline for three consecutive months). 


Subdivided homes (condos and SFH) numbered 21,582 units, a decrease of 1.2%, marking a decline for five consecutive months. 


Breaking down the subdivided home numbers, condo starts increased to 11,174 units (an increase of 9.4%, marking the first increase in four months), while subdivided SFH decreased to 11,368 units (a decrease of 8.8%, continuing a decline for 12 consecutive months).


Housing start data is a crucial economic barometer, reflecting the strength of construction, job creation, and consumer confidence. Rising starts signify growing demand, stimulating various sectors like manufacturing and real estate, while declines can signal economic slowdowns, impacting employment and consumer sentiment.

In the three major metropolitan areas, the Greater Tokyo Area totaled 25,813 units (a decrease of 3.8%), consisting of 4,034 owner-occupied houses (a decrease of 14.6%), 11,529 rental houses (a decrease of 5.7%), and 12,203 newly developed houses (an increase of 3.7%). 


The Chubu Area (Greater Nagoya) amounted to 7,833 units (a decrease of 5.8%), including 2,756 owner-occupied houses (a decrease of 13.3%), 2,752 rental houses (an increase of 2.5%), and 2,233 newly developed houses (a decrease of 7.3%). 


The Kinki Area (Greater Osaka) accounted for 12,445 units (a decrease of 10.6%), comprising 2,531 owner-occupied houses (a decrease of 14.1%), 5,812 rental houses (a decrease of 5.5%), and 4,068 newly developed houses (a decrease of 2.8%).


Further reading:

MLIT PDF release for October 2023 housing starts (technical RE Japanese only)

kencha510
.pdf
Download PDF • 663KB



Source:

R.E. Port News (Japanese only)

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