Tokyo apartment prices hit record on tight supply, surging building costs
Home values in the city are on an upward trend, as a weak yen increases costs of imported raw materials
[TOKYO] Tokyo’s new condominium prices rose to a record in 2025, driven by ballooning construction costs, supply constraints and more expensive luxury apartments hitting the market.
The average price of a new apartment for sale in the Japanese capital and surrounding areas rose by 17 per cent to 91.8 million yen (S$757,350), figures released on Monday (Jan 26) by the Real Estate Economic Institute showed.
Prices had fallen slightly in 2024 after increasing for five years in a row.
Home values in Tokyo have been on an upward trend, as a weak yen increases costs of imported raw materials and a labour shortage adds to construction expenses.
The supply of new apartments in the Tokyo metropolitan area fell by 4.5 per cent to the lowest in more than 50 years, the report showed, adding to price pressures in a market dominated by high-end projects.
Zoe Ward, CEO of brokerage Japan Property Central, said: “Developers are focusing on central locations where they can sell luxury condos and justify the pricing. A lot of their inputs will be construction costs and land pricing.”
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The Bank of Japan’s campaign to raise interest rates has done little to cool home prices.
The frothy market has spurred concerns about affordability and speculation by foreign buyers. Prime Minister Sanae Takaichi has asked government ministries to consider better ways to monitor such investments.
Average prices of new condominiums in central Tokyo grew by about 22 per cent to 136 million yen for the year, the report revealed.
The number of new apartments listed for more than 100 million yen surged by 55 per cent. The most expensive one for sale in 2025 was a 2.5 billion yen unit at Brillia Tower Nogizaka. BLOOMBERG
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