Highest Increase in 33 Years... Japan's Nationwide Land Prices Rose 2.7% Last Year

"Investment Funds Flow into the Japanese Real Estate Market"
"Yamano Gakki Ginza Main Store" Ranks First for 19 Consecutive Years

Last year, Japan's land price growth rate reached its highest level in 33 years.

Pedestrians passing through Ginza Street in central Tokyo, Japan. Photo by AFP and Yonhap News Agency

According to Kyodo News and Nihon Keizai Shimbun on the 18th, the official land price announced by Japan's Ministry of Land, Infrastructure, Transport and Tourism as of January 1 this year rose by an average of 2.7% nationwide compared to the previous year, marking the fourth consecutive year of increase. This is the highest growth rate in 33 years.

Japan's official land price is determined by the Ministry of Land, Infrastructure, Transport and Tourism based on appraisals of 26,000 standard land points nationwide. During the bubble economy period, Japan's land prices showed double-digit growth rates, but they began to plummet in 1992 and have struggled to escape a long-term stagnation even after the bubble burst.

Kyodo News explained regarding last year's official land price increase rate, "It is almost at the same level as the inflation rate, so the pattern is different from the bubble economy period," and added, "The background of the increase includes investment funds flowing into the Japanese real estate market."

According to the global integrated real estate services company Jones Lang LaSalle (JLL), investment in Japanese real estate last year reached 5.5 trillion yen (approximately 53.3 trillion KRW), an increase of about 60% compared to the previous year. Kyodo News reported that about 1 trillion yen of this amount came from overseas investments.

Looking at the official land price growth rates by region, the three major metropolitan areas of Tokyo, Osaka, and Nagoya led the nationwide land price increase last year with an average of 4.3%. In particular, commercial land in Tokyo's 23 wards rose by as much as 11.8%. Regional areas saw an average increase of 1.3%.

Some areas in the regions showed growth rates surpassing those of metropolitan areas. The commercial land in Chitose, Hokkaido, where Rapidus's semiconductor factory was newly established, rose by 48.8%, and residential land in Furano City, Hokkaido, popular among foreigners, increased by 31.3%.

The most expensive official land price location was "Yamano Gakki Ginza Main Store" located on Ginza Street in Tokyo, ranking first for 19 consecutive years. It rose by 8.6% compared to the previous year to 60.5 million yen (approximately 580.75 million KRW) per square meter.