Note:
In Japan, land is regarded as a separate asset from buildings. Therefore, the term “Land Price” is normally used instead of “Property Price”, not only for an agricultural land but also for developed lands.
Land prices are normally determined by market comparisons utilizing land price indices prepared by the Government; such as those within the “Land Price Publication” by Ministry of Land, Infrastructure and Transport.

Land-price Trends in 2003 - based on 2004’s Published Land Prices

Based on land-prices published in 2004, general land-price trends in 2003 were as follows:

1)   Year-on-year land prices continued to decline beyond January 2003, but in relation to lands for commercial use the actual extent of the decline has diminished for two consecutive years; and, in the case of lands for residential use, for the first time in 6 years.

2)   In the three large metropolitan areas, the extent of land-price decline has diminished both for lands for residential and commercial use. In local areas, on the other hand, the extent of land-price decline increased for lands for residential use, but remained the same as the previous year for lands for commercial use.

3)   By way of background to the diminishing rate of land-price decline in the three large metropolitan areas, we can point to recent signs of economic recovery in Japan, the continuing trend of population-return to the city centers and an enhanced capacity to attract consumers through urban renaissance measures.

4    In the “Central Wards Area” of  Tokyo, there was an increase in the number of sites where land prices either rose or leveled off. In some parts of the “South-West Wards Area” and “North-East Wards Area” of  Tokyo, and in the “Tama Area”, there was an expansion in the foot-print of sites where land prices had either leveled-off or almost leveled-off. In “Nearby Tokyo Area” in Chiba Prefecture there were a number of sites where land prices actually increased. In all of these areas, it appears the bottoming-out trend has strengthened.

5)   In Nagoya City, Sapporo City and Fukuoka City as well, there were an increasing number of sites where land prices had either increased or leveled off. With regard to the Osaka area, there was only a slight increase in the number of sites where land prices had leveled-off, and this only related to lands for commercial use in the Cities of Osaka and Kyoto.

6)   The bottoming-out trend in the “Tokyo Wards Area”, observed in published land prices of one year ago, has now also emerged in the main cities of other regional areas. And this is seen and interpreted as a sign of change in land-price trends across Japan.

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(1)   Lands for residential use

The extent of land-price decline has diminished in all areas.

In fact, in the “Tokyo Wards Area”, the extent of land-price decline has diminished for five consecutive years. In the “Central Wards Area”, in particular, land-prices have already almost leveled-off; and in the “South West Wards Area” are at the point of almost leveling-off.

At all sites designated for published land-pricing in Minato and Shibuya Wards, land-prices have either increased or leveled-off. In Minato Ward, overall land-prices have turned and are increasing again. In Shibuya Ward they have been increasing for two consecutive years. And, in Chiyoda Ward, prices have also turned, and are increasing.

Land-prices have almost leveled off in most other wards in Tokyo’s “Central Wards Area” and “South-West Wards Area”, and also in Koto Ward in the “North-East Wards Area”.

Urayasu City and Ichikawa City in the “Nearby Tokyo Area” of Chiba Prefecture have also produced some sites where land-prices increased. And in cities like Musashino and Mitaka in “Tama Area”, there was an increase in the number of sites where land prices had leveled-off or almost leveled-off.

As background to the above situation, we can point to reasonable-price perceptions amongst potential buyers, to an increase in the number of inner-city conveniences arising out of redevelopment projects and to the continuous movement of people returning to central city locations, which has led to a steady demand for residential property, including condominium apartments.

In remote suburban areas, where commuting to work is not easy, we have observed a continuous steep decline in land prices at sites where traffic-movement and transportation convenience is inferior. On the other hand, in areas where relatively better public conveniences exist, there were some sites where the price decline was only slight.

(2)   Lands for commercial use

The extent land-price decline has diminished in all areas.

In the “Tokyo Wards Area”, the extent of land-price decline has diminished for five consecutive years. In Shibuya Ward, in particular, land-prices have been on the increase for two years; and in Ota, Setagaya and Koto Wards land-prices have almost leveled off.

In the “Central Wards Area”, we have seen an increase in the number of sites where land-prices have risen or leveled off. In parts of the “South-West Wards Area” and the “North-East Wards Area”, and in  Musashino City in the “Tama Area”, there has been an increase in the number of sites where land prices have either leveled-off or almost leveled-off.

In the “Central Wards Area” in particular (in highly dense commercial areas, in areas where overseas brand shops have recently been established and in areas where traffic infrastructure development projects and urban renaissance measures have been promoted) we observe continuously many sites where land-prices have either increased or leveled off. In such areas as Ginza and Omote-Sando, for example, we continue to observe sites where high rates of increase in land prices are being achieved.

In locations other than the “Central Wards Area”, near Futago-Tamagawa Station and Kashiwa Station, there are sites where land prices have turned and are increasing.

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(Lands for Commercial Use)

(1)   Lands for residential use

The extent of land-price decline has diminished in almost all areas.

In Tennoji Ward in Osaka City, where demand for residential properties, including condominium apartments, is steady, there are sites where land-prices have continued to level-off, while in the some of the surrounding areas the rate of land-price decline has only been small.

(2)   Lands for commercial use

The extent of land-price decline has diminished in all areas.

In the “Central Six Wards” in  Osaka City, in particular, the extent of the decline in land prices has been diminishing for four consecutive years.

In Osaka City, there has been an increase in the number of sites where land-prices have leveled-off, particularly around Osaka Station where urban renaissance measures have been promoted. There has also been an increase in the number of sites where land prices have leveled-off around Shinsaibashi, where the location of new overseas-brand shops has been promoted.

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(Lands for Residential Use)

(1)   Lands for residential use

The extent of land-price decline has diminished in most areas.

In the Eastern part of  Nagoya City, and around the newer train-stations in “Areas Near Nagoya”, we now see sites where land-prices have turned and are leveling-off. In some parts of the “Nishi Mikawa Area”, including Toyota City, where the regional economy is strong, there are sites where prices have continued to level-off.

(2) Lands for commercial use

In most areas, the rate of land-price decline turned and diminished.

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(l) Lands for residential use

The rate of land-price decline continued to grow in relation to lands for residential use, but the extent of the decline was less than that for lands for commercial use. In certain areas of Sapporo City and Fukuoka City , especially where urban conveniences are located, and along railway lines where the residential environment is excellent (with good access to the city center) we observed sites in the residential areas concerned where land-prices had either increased or leveled-off.

(2) Lands for commercial use

In local areas overall, land-prices for commercial use declined to the same extent as the previous year. In local cities with the population of not less than 100,000, however, the extent of this decline diminished. Particularly in the central commercial areas of Sapporo City and Fukuoka City, both being major regional center cities, there had been an increase in the number of sites where land-prices either increased or leveled-off. This was largely due to urban renaissance efforts and traffic infrastructure development in these areas.

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