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Tokyo condo rents rise for 7th year in 2024 at slower rate than 2023

Writer's picture: Adam GermanAdam German

On January 17th, the Nikkei Shimbun reported that the average rent for condominiums in Tokyo reached ¥4,163 per square meter in 2024, marking a 3.2% increase from the previous year  


This was in turn according to a report released by real estate research firm Tokyo Kantei on January 16th.  


2024 marks the seventh consecutive year of average rent growth, though the pace slowed compared to 2023, when rents rose by 7.5%.  


Graph courtesy of the Nikkei Shimbun, translated by Patience Realty. 


Despite robust rental demand, the sharp rent increases have reached levels that are discouraging potential tenants. 


Tokyo's Rent Trends and Regional Comparisons 


Condominium rents refer to the rental prices set by individual condo owners renting out their units. The survey analyzed family-type units, excluding those under 30 square meters as well as properties used as offices or shops.  


In the Greater Tokyo Area, which includes Tokyo and three adjacent prefectures, the average rent rose 2.6% year-on-year to ¥3,603 per square meter.  


Within Tokyo’s 23 wards, rents climbed 3.4% to ¥4,295 per square meter. 


Monthly data for 2024 showed that rents continued to rise during the first half of the year, reaching a record high of ¥4,336 per square meter in June, the highest since tracking began in 2004.  


However, from July onwards, the supply of newly built rental properties dwindled, and concerns over weakening demand led to fewer rent increases.  


This caused the average monthly rent to decline in many instances compared to the previous month. 


Economic and Demographic Factors Affecting the Market


Rental prices in Tokyo are closely tied to tenants' economic circumstances. Many renters belong to the “real demand segment”, meaning they base their decisions on necessity rather than speculation.  

Rising cost-consciousness among consumers has dampened their willingness to pay high rents. Masayuki Takahashi, Senior Chief Researcher at Tokyo Kantei, noted, “Urban migration [within Japan] is tapering off, making it increasingly difficult to set aggressive rent levels.” 


The limited supply of newly built properties is likely to persist into 2025. “Short-term trading among condo buyers is increasing, reducing the number of units available for rent,” added Takahashi.  

 

Source: 

Nikkei Shimbun (Japanese only; paywalled) 

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