Tokyo rent index shows growing gap between central and outer markets

Tokyo’s condominium rental market is showing a widening geographic divide.

Contracted rents in the Tokyo 23 wards rose again in the second quarter of 2026, while Tokyo non-23 wards moved in the opposite direction.

Photo by Frank Okay on Unsplash

The condominium rent index for the Tokyo 23 wards reached 136.09, up 1.26 points from the previous quarter. Tokyo non-23 wards fell 1.13 points to 120.83, according to the index produced by AtHome and Sumitomo Mitsui Trust Research Institute published on September 24th.

Three points stand out:

• Rental pressure remains strongest and most persistent in the Tokyo 23 wards.

• Smaller apartments led the latest quarterly increase in the 23 wards.

• Tokyo non-23 wards are showing a more uneven rental market, particularly for larger homes.

The suburban decline does not yet amount to a sustained downturn - the overall index remains above its year-earlier level.

But the latest figures show why a single “Tokyo rent” figure can obscure important differences within the metropolitan market.

Smaller apartments lead the 23-ward increase

The index is useful because it measures contracted rents - rents agreed in actual new leases - rather than rents currently advertised by landlords or agents.

It divides condominiums into three size categories:

• Single: 18 to less than 30 sq. meters

• Compact: 30 to less than 60 sq. meters

• Family: 60 to less than 100 sq. meters

The index is based on AtHome transaction data and uses a hedonic methodology to adjust for differences in property characteristics.

The first quarter of 2009 is set at 100.

Single units led the latest increase in the Tokyo 23 wards, rising 2.79 points to 136.77. Compact units increased 0.29 point, while family units gained 0.26 point.

The quarterly figures therefore show strong momentum among smaller apartments.

Over a longer period, however, larger rental homes have also experienced substantial increases. The family-unit index was 13.23 points above its level a year earlier, compared with a 10.74-point increase for single units.

Sumitomo Mitsui Trust Research Institute said the overall Tokyo 23-ward index has now reached a record high for 15 consecutive quarters.

It pointed to continued inflows of younger single-person households as one source of demand for smaller units, while high condominium purchase prices may also be keeping some households in the rental market for longer.

Larger homes weaken outside the 23 wards

Tokyo non-23 wards presented a markedly different picture in the latest quarter:

• Single: up 0.30 point

• Compact: down 1.76 points

• Family: down 1.78 points

The contrast is clear among larger homes. While the family-unit index in the Tokyo 23 wards was 13.23 points above its level a year earlier, the corresponding Tokyo non-23-ward index was 1.27 points lower.

Still, the latest decline follows two relatively strong quarters. The overall Tokyo non-23-ward index rose 3.04 points in the fourth quarter of 2025 and another 3.44 points in the first quarter of 2026 before falling in Q2.

That makes it too early to call a sustained suburban downturn. The clearer distinction is between persistent upward momentum in the Tokyo 23 wards and a more uneven market outside them.

Osaka leads a mixed picture across Japan

The differences were not limited to Tokyo. The latest quarter produced sharply contrasting results across the other major cities covered by the index.

Osaka City recorded the strongest overall increase, rising 4.60 points to 144.84. Unlike Tokyo, where the latest increase was concentrated in smaller homes, Osaka recorded gains across all three apartment categories. Compact units rose 4.61 points and family units gained 2.40 points.

Sapporo’s overall index rose 2.07 points to 132.58, but the headline increase concealed a much less uniform market. Single units jumped 6.18 points, while family units fell 1.36 points.

Three other major markets declined:

• Fukuoka: down 2.69 points to 131.98

• Sendai: down 1.54 points to 125.20

• Kyoto: down 1.20 points to 124.41

The contrast between Osaka’s broad increase, Sapporo’s small-unit-led growth and declines in Fukuoka, Sendai and Kyoto reinforces the main message from Tokyo: Japan’s condominium rental market is not moving uniformly. Location and apartment size matter when assessing where contracted rents are rising.

Further Reading:

AtHome and Sumitomo Mitsui Trust Research Institute: Condominium Rent Index, Q2 2026 release (Japanese only)

Sumitomo Mitsui Trust Research Institute: Condominium Rent Index market commentary (Japanese only)

R.E.Port: Condominium rent index rises in Tokyo 23 wards, falls outside wards (Japanese only)