Soaring Prices: Tokyo’s Luxury Real Estate Market and Minato Ward’s Popularity

The tallest and most expensive condominium in Japan has emerged

In November 24, 2023, “Azabudai Hills,” is scheduled to open in Minato Ward, Tokyo. The main tower here stands at 330 meters high with 64 stories, making it the tallest building in Japan. Occupying the top floors from the 54th to the 64th is the “Aman Residences Tokyo.” Condominium prices start at a minimum of 2 billion yen, while penthouses are reportedly priced between 20 billion and 30 billion yen (exchanging to USD is approximately $133,465,920 to $200,198,880)

Previously, top-tier condos were priced around 6 billion yen, making Aman Residences Tokyo by far the most expensive condominium in Japan. There are a total of 91 units in this property, and it is likely to dominate the high-end housing market.

Additionally, the “Azabudai Hills Residences” includes around 1,300 rental condominium units. Due to the influence of Azabudai Hills, the average condominium price in Tokyo has exceeded 100 million yen for the first time. This surpasses the previous record during the real estate bubble. Factors such as rising labor costs and construction materials, along with the increasing number of luxury condominiums being constructed in the city, have contributed significantly to this price surge.

Tokyo’s real estate prices are incredibly high, especially in Minato Ward

Redevelopment is happening all across Japan. In Osaka, large-scale condominiums have been completed, with the most expensive units priced at 2.5 billion yen. Similarly, real estate prices in the resort area of Niseko, Hokkaido, are soaring. Due to the perception of affordability driven by a weaker yen, these properties are becoming targets for real estate investments from overseas, both for residential and investment purposes. In fact, in 2022, Hokkaido had the highest price change rate in the national real estate market, with all top 10 areas in terms of price change rate located in Hokkaido.

However, real estate prices in Tokyo are overwhelmingly high. Among the top 10 areas with the highest real estate prices, all of them are located in Tokyo, including both residential and commercial areas.

The highest-priced residential area in Tokyo is Akasaka, Minato Ward. This area is known for its luxury condominiums, the U.S. Embassy, and office buildings. It is located within a 10-minute walk of Azabudai Hills.

Minato Ward has the most areas among the top five, followed by Chiyoda Ward with four areas, and Shibuya Ward. Each of these areas has been considered prestigious residential locations for a long time, and there hasn’t been significant change compared to the previous year.

While Tokyo’s condominium prices have reached an all-time high, they are still only approximately 30% of what they were during the real estate bubble period around 1990. Japan has been in a deflationary state for 30 years since the bursting of the bubble, while the rest of the world has experienced inflation. During this time, real wages have only increased by a mere 0.1%.

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Due to this prolonged deflationary period and a rapid depreciation of the yen, Japan’s real estate appears relatively affordable and has attracted growing real estate investments from overseas.

In Conclusion

The work-from-home trend resulting from the COVID-19 pandemic has led to an increase in relocations to areas outside Tokyo, but Tokyo remains a popular choice. Real estate prices are significantly higher in Tokyo, and redevelopment projects are planned for the coming years in Minato Ward and Chiyoda Ward. In Chiyoda Ward, the “Torch Tower”, set to be completed in 2028, will stand at 385 meters, surpassing Azabudai Hills and becoming the tallest building in Japan. It seems that the trend of rising real estate prices will continue in the near future.