Do you want to buy a house in Tokyo ? Which area do you want to buy your property ?
I believe understanding the location is a key to being successful
with buying a house (or apartment).
In Japanese big cities such as greater Tokyo, Osaka, Nagoya,
people do not commute by car but by train or subway.
They get on and off train every single day.
If the number of residents increases, the station nearby flourishes and
the vibrancy is born in the town.
On the other hand, if the number of station users decreases, we could see the
recent issues like “vacant house problem”.
Empty houses problems are even becoming serious in the area of Denenchofu station, Tokyu Toyoko Line,
which has been admired as said a prestigious residential area.
This is because the wealthy people who live in Denenchofu are moving into
high-rise apartments in the center of Tokyo.
When buying real estate in Tokyo, it is extremely important to check the trend of
passengers of the nearest station.
Unlike large cities in the US and Europe, there are few business people
who commute to work by car in Tokyo.
The convenience of commuting to work and the convenience of shopping are directly
linked to the value of real estate in Tokyo.
The more people gather, the higher the value of the properties is.
Historically in Tokyo, the western and southern side of Tokyo have
been popular among business people who work for the big companies.
But in recent years, the trend of the market is changing.
Demand of eastern and northern areas of Tokyo is on the rise.
Although there are various reasons for this market change,
the biggest reason is the change in lifestyle of
people living in Tokyo, especially 30s – 40s family.
The 30s to 40s are the main age group to purchase real estate and
it is not unusual any more for couples in their thirties and forties both
to have full-time jobs.
There are many young couples with children even though Japan has encountered a
declining birthrate.
These couples are very busy with work, child care, and in some cases parents care.
For such busy couples, commuting time to financial and business centers such as
Marunouchi and Otemachi is an essential factor when they buy their houses or apartments
(even when renting).
It may not be surprising that the demand of the eastern region of Tokyo which is comparatively
close to the the financial center is getting higher.
Such couple movements will affect the number of passengers getting on and off at each station.
If the number of station users increases, the economy around the station will be activated, and
as a result the in theory,real estate prices will often be appreciated.Let’s discuss the changes of some cases of the station in the Tokyo metropolitan area while
referring to the magazine Toyo Keizai December 7, 2017 issue.
The first thing you need pay attention is the good transport accessibility
(in other words good accessibility to the train stations) for commuting
and other activities is a key.
As I mentioned earlier, the busy couples(they are often called “power couples”)
have very marginal time to commute.
They want to minimize the time spent on pick up and drop off by children.
In that sense, the station which is attracting special attention recently is
Musashi Kosugi station(both JR line and Tokyu Toyoko line) in Kawasaki city.
The number of passengers at Musashi Kosugi station over the last 5 years rose
by about 24%.
The area was full of factories before but the redevelopment
has progressed since 2000.
Many high-rise apartments were built there.
Large commercial facilities also opened which are very beneficial for busy couples.
From Musashi Kosugi station to Tokyo station, you can go by JR in only 20 minutes
which is well below the average commuting time.
Toyosu station of Tokyo bay area is also a very popular place for young couples.
Tsukishima station and Kachidoki station along the Toei Oedo Line which opened
in 2000 also are growing fast.
On the other hand, many wealthy young entrepreneurs and executives of
big companies prefer places such as Shinagawa station and Osaki station.
There are a number of high-rise luxury condominiums in the very central areas of Tokyo.
The number of passengers at Osaki station rose by about 26% over the past five years.
Also, Meguro Station (Shinagawa Ward) is popular among young people
and prices of real estate are rising.
From a regional perspective, as I mentioned earlier, the intra-migration of
the population into the eastern Tokyo region is prominent.
Specifically, at Kiyosumi Shirakawa station (Koto ward), the number of passengers
has grown 31% over the past five years.
In other eastern areas, more passengers getting on and off compared with that of
five years ago.
For example, due to the increase of passengers, Kanamachi station (Katsushika- ward),
Kinshicho station (Sumida- ward),
Shin-Koiwa station (Katsushika-ward) real estate prices are expected to be steady.
Tokyo Science University has opened a campus near Kanamachi station.
Also at Kitasenju station near Kanamachi station,
Tokyo National University of Fine Arts and Tokyo Denki University
Campus is newly opened and young students are flowing in.
Meanwhile, let me show the stations that are falling in popularity
over the past five years.
The number of passengers getting on and off at the following stations
will have a negative impact on real estate prices.
Denenchofu Station: -5%
Seiseki-Sakuragaoka Station: -2.1%
Shimokitazawa Station: -12%
Futamatagawa station: -1.8%
Obviously the number of passengers is not the only factor
which indicates the value of the property but in Tokyo,
(and other mega cities) it is always worth watching.
Toshihiko Yamamoto
Real estate investing consultant and author.
Toshihiko is currently writing a book about the real estate investing in Japan
for foreign investors.
Founder of Yamamoto Property Advisory in Tokyo.
International property Investment consultant and licensed
real estate broker (Japan).
He serves the foreign companies and individuals to buy and sell
the real estates in Japan as well as own homes.
He holds a Bachelor’s degree in Economics from
Osaka Prefecture University in Japan
and a MBA from Bond University in Australia.