The 2023 trends for the Japanese Real Estate market remain stable, and the Japanese properties are expected to be attractive for the global investors in the first half of this year. Still, the latter half requires cautious investment behavior as the interest rates may rise being accelerated by the slow paced recovery from the post-COVID economic recession.
As for the positive trends, according to the Ministry of Land, Infrastructure, Transport and Tourism, the average land value in all categories nationwide grew by around 2% compared to January 2023. It's a second year in a row with the land prices going up after the long coronavirus pandemic economic shock. Residential-use land values in regions also rose by 0.4% for the first time in almost three decades.
The Japanese economy is likely to follow the recent recovery trend, but a dramatic increase in interest rates is not expected to happen. As for the low-cost property market, it doesn't show any signs of changes, which would serve a backup for the real estate market liquidity on the whole. Given that, the real estate investment interest rates are expected to be secured, which makes the Japanese real estate investment market much safer than any other in the same region.
Also, with a WHO finally lifting the pandemic state of emergency and Japan resuming inbound tourist entry the investors now put their hopes upon retail and hotel properties as well as private lodging management which is now possible due to demand revival.
Major Japanese cities real estate market shows positive trends towards multi-family rental residential property investment. In the past 5 years the foreign investors accumulated core assets in the Tokyo, Nagoya, Osaka and Fukuoka residential areas which caused both stable flow of cash and a great tenant diversification. Still, given this the property investment market became extremely competitive, the expected yields were keep on declining. Even though, it doesn't mean you have to give up investing in Japanese property as the market still produces stable benefits.
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