Quarterly Report for Premium Condominiums in Tokyo | 3Q FY 2023

【Chart 1】

This graph shows an index of changes in average contract price per tsubo (*Notes: 1. Indexation using average contract price per tsubo in 1Q / FY 2006 as 100. 2. Tsubo is a Japanese traditional unit of area equal to approx. 3.31sqm.) and the number of contracts concluded every quarter for premium condo. units in 7 prestigious areas of central Tokyo.

 Major economic events and Nikkei Stock Average are also shown for reference. The bar graph represents the number of contracts concluded each quarter. The red-line shows a movement in the index of average contract price per tsubo, while the gray-line shows one in the Nikkei stock average.

In the 3rd quarter reviewed here (Oct 1 - Dec 31, 2023 based on Japanese fiscal year), the index of average contract price per tsubo for premium condominium units sold went up by +1.6 points QoQ to reach 200.7, hitting a new all-time high since the beginning of data collection for the second consecutive quarter. At the same time, the number of contracts concluded fell by 32 QoQ to 159. This was the first decline since the 4th quarter of 2022. 

【Chart 2】

Firstly, the chart above shows average contract price per tsubo. There were declines in the following two areas: “Hiro-o / Daikanyama / Ebisu Area” and “Setagaya / Ohta Area.” On the other hand, the average contract price per tsubo went up in the other seven areas. Among these areas, the average contract price per tsubo hits an all-time high since the beginning of data collection in the following six areas: “Azabu / Akasaka / Roppongi Area,” “Shirogane Takanawa / Azabu-jyuban Area,” "Ginza Area," “Bancho / Kojimachi Area,” “Ichigaya / Yotsuya Area,” and “Meguro / Shinagawa Area.” Furthermore, “Bancho / Kojimachi Area” has hit their highest figures for the past three quarters in row. Even more surprising, “Azabu / Akasaka / Roppongi Area.” has shattered their highest figures for the past six quarters in row.

【Chart 3】

Secondly, the chart above shows the number of contracts concluded. There were declines in the following five areas: “Azabu / Akasaka / Roppongi Area,” “Hiro-o / Daikanyama / Ebisu Area,” “Aoyama / Shibuya Area,” “Shirogane Takanawa / Azabu-jyuban Area,” and “Setagaya / Ohta Area.” Among these, the following two areas showed especially large declines: the “Azabu / Akasaka / Roppongi Area,” where the decline was more than 10 contracts, and the “Shirogane Takanawa / Azabu-jyuban Area,” where it was more than 20 contracts. On the other hand, the number of contracts went up in the four areas of the "Ginza Area," “Bancho / Kojimachi Area,” “Ichigaya / Yotsuya Area,” and “Meguro / Shinagawa Area.” Among these, the “Meguro / Shinagawa Area” recorded an all-time high with an increase of more than 20 contracts.

While the number of contracts began to decrease this quarter, the average price per tsubo hit a new all-time high for the second consecutive quarter. The number of listings for all the nine areas combined in the market as of the end of this quarter was 531, which shows a decline compared to the level a year ago. It will be worthwhile to note how this decline will affect the number of contracts and the average price per tsubo in the ensuing quarters. It will be prudent to keep closely watching the impact from the resales of large-scale developments that recently constructed, and demand from overseas investors on top of the economic and financial situations.