Japan Land Prices Rebound After Marking 1st Fall In 6 Years

The average price of land in Japan rebounded on the back of solid housing demand after falling for the first time in six years the previous year due to the impact of the coronavirus pandemic, the government said Tuesday, Mainichi Japan reported.

Photo Insert: Land reclamation in Japan

Land in all categories nationwide, including that for residential and commercial use, rose 0.6 percent from a year earlier as of Jan. 1, according to the Ministry of Land, Infrastructure, Transport and Tourism.

The ministry said a recovery trend has been observed, driven by housing demand in urban areas and vicinities, as the influence of the pandemic is waning. The survey covered 26,000 locations across the country before the so-called "sixth wave" of infections hit Japan.

The prices of residential land rose 0.5 percent on average and those of commercial land went up 0.4 percent. In Tokyo, the prices of residential and commercial land rebounded for an increase of 1.0 percent and 0.6 percent, respectively, as housing demand expanded with people reviewing their residential environment amid the spread of telework.

The prices of residential and commercial land also rose in three prefectures adjacent to Tokyo -- Saitama, Chiba, and Kanagawa.

Despite the positive results, land experts pointed out that the prices from now would largely be affected by the impact of Russia's military aggression against Ukraine on the world economy and financial markets, in addition to the situation of COVID-19.

"For example, if prices of crude oil and wheat remain high for a long period and trigger a significant price hike in daily necessities, it will dampen people's appetite to purchase homes and spend money in commercial districts," said Takeshi Ide, a senior researcher at real estate research firm Tokyo Kantei Co., referring to concerns over the Ukraine crisis.

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