Encouraged by a weaker yen, Hong Kong investors are hunting for Japanese real estate, snapping up luxury second homes on Tokyo’s waterfront and seeking steady rental yields from studio apartments in smaller cities.
The trend may provide more tailwind to Japan’s housing market, bolstered in recent years by new developments ahead of the Olympic Games. Prices of new condominiums in Tokyo last year topped a record set in 1990 at the end of Japan’s asset-inflated bubble era. Even with those gains, Tokyo apartments remain cheaper per square meter than those in London, New York and especially Hong Kong -- the world’s least affordable home market.
“There’s no gain if you park your money at the bank,” she said. “But with this I get a 5 per cent yield.” However, some point out the risks for Japan’s market, including a shrinking local population and a tendency for the value of buildings to depreciate quickly. Shun Ogishima, a researcher at Sumitomo Mitsui Trust Research Institute, also said the pandemic had changed people’s lifestyles and preferences, trends which may be difficult for foreign investors to assess.“We have seen a shift from the city centre to the suburbs, and higher demand for bigger properties.