On November 29th, Japan’s Ministry of Land, Infrastructure, Transport, and Tourism (MLIT) released Japan housing starts data for October 2024, highlighting a continued downward trend in residential construction.
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New housing starts fell by 2.9% year-on-year (YoY) to 69,669 units, while the total floor area dropped by 0.9% YoY to 5.399 million square meters.
Both figures have now declined for six consecutive months.
October 2024 Starts Breakdown by Housing Type
Custom Built Single-Family Homes (SFH): 19,705 units (+9.0% YoY), the first increase in nearly three years.
Rental housing: 29,541 units (-6.7% YoY), continuing a downward trend.
Sub-divided (strata title) housing:
Condominiums: 8,837 units (-13.1% YoY), continuing the decline for three consecutive months.
Sub-divided SFH: 10,511 units (-7.5% YoY), marking 24 months of continuous decline.
Japan Housing Starts October 2024 Regional Trends
Greater Tokyo Area: Total housing starts fell slightly to 25,586 units (-0.9% YoY). Custom Built SFH starts rose 3.0% YoY to 4,157 units, while rental starts remained flat at 11,529 units. Condominiums, however, dropped 6.1% YoY to 9,582 units.
Chubu (Nagoya) Region: Housing starts increased 9.0% YoY to 8,536 units, driven by an 11.3% YoY rise in custom-built SFH starts (3,067 units) and an 8.9% YoY increase in rentals (2,997 units). Condominiums, however, declined by 4.3% YoY to 2,137 units.
Kinki (Osaka) Region: Housing starts decreased significantly by 14.0% YoY to 10,708 units. While owner-occupied homes rose 4.6% YoY to 2,648 units, rentals declined 12.9% YoY to 5,063 units, and condominiums plummeted 27.6% YoY to 2,945 units.
Why are Housing Starts Important?
The term "housing starts" refers to the beginning of construction on a new residential property.
The launch of these projects represents a major investment in capital goods and often triggers increased consumer spending on items such as furniture and home appliances. Additionally, housing starts are a critical economic indicator that garners close attention from financial market observers.
The health of the housing sector plays a vital role in shaping employment trends and commodity prices, particularly for materials like lumber and copper.
As a reflection of builders' willingness to commit resources to new developments, housing starts providing insight into their confidence in future housing demand. This makes the trends in housing starts a key barometer of market sentiment and consumer confidence.
Sources:
R.E. Port News (Japanese only)
Ministry of Land, Infrastructure, Transport and Tourism (Japanese only)
