On August 20th, the Real Estate Economic Institute announced updated market trends for new condominiums in the Greater Tokyo Area (GTA) for July 2024.
The report separates metrics into the following four categories:
Number of condo units released for sale
The initial contract rate
Average condo price per unit
Average condo price per square meter
The initial contract rate refers to the percentage of condos released in the first phase of sales where buyers committed to signing a sales and purchase agreement.
Analysts globally use the 70% threshold as a benchmark for estimating the health of buyer demand; an initial contract rate above 70% means healthy buyer demand and below means weakening buyer demand.
Japan too follows the 70% global standard outlined above.
July 2024 Greater Tokyo New Condominium Release Trends
The number of units released for sale in July was 1,496, marking a 42.3% Year-on-Year (YoY) decrease.
The sharp decline is mainly due to the delay of several large-scale projects, causing a steep reduction in sales within Tokyo’s 23 wards and surrounding areas.
Broken down by measured regions:
Region | New Condo Units | % YoY Change |
Tokyo 23 ward | 609 | 60.5% down |
Tokyo non-23 ward | 104 | 30.2% down |
Kanagawa | 439 | 84.5% up |
Chiba | 247 | 247% down |
Saitama | 97 | 50.5% down |
Overall, Tokyo prefecture accounted for 47.7% of new condo sales contracts.
The initial contract rate during the first month of sales was 70.9%, a 3.9 percentage point drop from the previous year, though it recovered into the 70% range for the first time in four months.
Historical initial contract rate for GTA and Greater Osaka taken from report linked below and edited by Patience Realty.
The average price per unit dropped by 21.1% to ¥78.47 million, while the price per square meter decreased by 17.0%, reaching ¥1,203,000.
Among the newly released properties, five projects, including the first and second phases of "Park Tower Omori" in Ota Ward, Tokyo, were sold out on the same day, totaling 71 units.
The institute anticipates around 1,500 units to be released in August.
Further Reading:
Real Estate Economic Institute GTA New Condo Market Trends in July 2024
Source:
R.E. Port News (Japanese only)
