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Japan regional land prices post 1st rise in 28 years

  • March 18, 2020
  • , Jiji Press , 5:09 p.m.
  • English Press

Tokyo, March 18 (Jiji Press)–Land prices in Japan’s regional areas, excluding the four core cities of Sapporo, Sendai, Hiroshima and Fukuoka, as of Jan. 1 rose for the first time in 28 years, a land ministry survey showed Wednesday.

 

The average posted land price for residential and commercial districts in the regional areas at the beginning of this year rose 0.1 pct from a year earlier, according to the survey.

 

The rise, coupled with continued land price growth in the four core regional cities and in the three metropolitan areas of Tokyo, Osaka and Nagoya, attested to the nationwide recovery trend for land prices.

 

In the survey, a relevant ministry panel calculates the prices of one-square-meter plots of land at about 26,000 locations across the country as of Jan. 1 every year, based on the assessments by certified real estate appraisers. The land prices set by the ministry and so-called standard land prices, surveyed by prefectural governments as of July 1, are utilized as benchmarks for land transactions.

 

The average posted price of all residential and commercial land plots surveyed by the land ministry climbed 1.4 pct, up for the fifth straight year, with residential land prices going up by 0.8 pct and commercial land prices by 3.1 pct.

 

Residential land prices rose mainly in areas with convenient public transport networks, while the commercial land price growth reflects a surge in demand for shops and hotels on the back of the increasing number of visitors from abroad.

 

The effects of the outbreak of the new coronavirus were apparently not reflected in the latest survey, as the first domestic case of infection was confirmed in mid-January, about two weeks after the survey date.

 

In the three metropolitan areas, residential districts saw a 1.1 pct increase in land prices, larger than the 1.0 pct rise the previous year, while commercial districts posted a 5.4 pct increase, bigger than 5.1 pct.
 

Land prices in the cities of Sapporo, Sendai, Hiroshima and Fukuoka logged heftier increases, of 5.9 pct for residential districts and 11.3 pct for commercial districts, greater than the year-before rises of 4.4 pct and 9.4 pct, respectively.

 

In the regional areas excluding the four core cities, commercial land prices rose 0.3 pct, up for the first time in 28 years. Residential land prices almost stopped declining. Price growth was especially evident in prefectural capitals and cities serving as regional economic hubs.

 

On the other hand, areas damaged by Typhoon Hagibis last October logged steep drops in land prices. In particular, the price of a land plot in the central city of Nagano dropped 13.6 pct, posting the steepest fall among all surveyed residential sites. The site is close to East Japan Railway Co.’s <9020> Shinkansen bullet train yard that was inundated due to the flooding of a nearby major river caused by heavy rain from the powerful typhoon.

 

Of the nation’s 47 prefectures, 20 saw growth in residential land prices and 24 in commercial land prices, with both figures increasing by two from the previous year.

 

In many of prefectures with lower land prices, the pace of falls decelerated year on year.

 

The sharpest residential and commercial land price rises were both registered in the town of Kutchan, a famous ski resort in the northernmost prefecture of Hokkaido, coming to 44.0 pct and 57.5 pct, respectively.

 

A land plot in the Akasaka district in Tokyo’s Minato Ward was the most expensive residential site in Japan for the third straight year, priced at 4.72 million yen per square meter, up 8.8 pct from a year before.

 

The site for Yamano Music Co.’s main store in the posh Ginza district in Tokyo’s Chuo Ward had the highest commercial land price for the 14th straight year, at 57.7 million yen, up 0.9 pct, although the rate of growth slowed from the previous year’s 3.1 pct.

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