A number of news sources have recently pointed to more evidence that the Japanese economy – more specifically the Abenomics transformation of it – has turned a corner.
Some key talking points are being raised – and for those considering buying a home or investing in the Tokyo property market – these should be of special interest. They point to long-term asset value, strong domestic demand and finally, the opportunities emerging amidst a construction wave that is transforming Tokyo`s topography.
Here’s a round-up of some of our key news items and a brief comment on how we interpret them.
Photo is from the soon to be completed Tokyo Midtown Hibiya. The second major development to carry the Midtown name. Sitting within the special economic zone that the Tokyo Metropolitan government has designated, it will be a major new business and lifestyle destination, connecting directly to cinemas, a theatre, the Imperial Hotel, The Peninsula Hotel from its placement at the corner of the Hibiya / Ginza business and government districts.
Tokyo’s ratio of new condo prices to income marks first drop in five years (Nikkei Asian Review)
As the article points out, this is largely being driven by cheaper properties being made available in nearby Chiba and Kawasaki Prefectures. However, as Tokyo`s young are highly employable and will likely enjoy steadily rising wages over the coming years, that purchase behavior will move into central Tokyo and likely provide a strong market of potential buyers for anybody that desires to sell a Tokyo property in 10 – 15 years time.
Tokyo hotel occupancy rates sink below 80% (Nikkei Asian Review)
Nothing to do with falling tourist numbers (which continue to grow at a rapid clip) but everything to do with the growing attraction for “Airbnb” style accommodation amongst those inbound travelers. The government has responded with new laws to legalize the practice of short-term letting of homes – and with integrated resorts due shortly after the Olympics, Japan`s standing as a major global destination is only set to grow.
No Rest For Reform As Japan’s Economy Surges Ahead (The Diplomat)
Noted expert on the Japanese economy, and speaker at the recent Housing Japan seminar, Jesper Koll points to rising wages, improved housing demand and the return of corporate “animal spirits” as evidencing a structural turnaround. To quote; “The April-June GDP report suggests that the Japanese economy has entered into a sweet spot, with growth accelerating and broadening into all components of domestic demand. While the 4 percent annualized GDP growth rate marks peak slingshot acceleration, the details of the report fully verify our thesis that Japan has entered a self-sustaining domestic demand-led up-cycle,” …
See Hiroshima differently from Japan’s new luxury seaplane (South China Morning Post)
Not major economic news, or even related to Tokyo, but we bring this up as it is another sign of how Japan is both embracing its new role as a growing lifestyle superpower and finding innovative solutions to changing demographics. The sea plan tour is one of a number of luxury travel experiences the country is developing, and as this article points out, it will also have a positive effect on regional populations.
Aston Martin targets Japan as part of UK trade mission (The Telegraph)
We have presented news before about how the international business zones and shifting economic policies are luring more high-end business to Japan. Seeking artistic, design and engineering talent, as well as access to the consumer market that continues to set trends for Asia. Apple, Huawei and now Aston Martin, are amongst the top international brands investing heavily.
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