What is the average rental yield in Fukuoka?

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BAMBOOROUTES

A team specialized in real estate investing in APAC countries (Japan, Thailand, Indonesia, Australia, etc.).

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Fukuoka. If you'd like to learn more about us, you can check our presentation page.

What are the typical rental yields in Fukuoka for different property types?

Fukuoka delivers some of Japan's most attractive rental yields, with significant variation based on property type and location.

Studios and one-bedroom apartments generate the highest returns at 6-8% gross yield, often reaching 10% in prime central districts near universities and business centers. These compact units benefit from strong demand from young professionals, students, and single workers who make up the majority of Fukuoka's rental market.

Two to three-bedroom apartments typically yield 4-6%, offering solid returns while attracting small families and professional sharers. These properties provide more stable, longer-term tenancies but require higher initial investment and may experience longer vacancy periods between tenants.

Houses generally deliver the lowest yields at 3.5-5%, primarily due to higher purchase prices, increased maintenance costs, and a smaller pool of potential tenants. However, houses can offer better long-term capital appreciation and attract family tenants who stay longer, reducing turnover costs.

Short-term rental properties through platforms like Airbnb can achieve exceptional yields of 8-12% in prime districts, though this requires active management and compliance with local regulations.

How do rental yields vary across different neighborhoods in Fukuoka?

Central Fukuoka districts significantly outperform suburban areas, with yields varying by 3-5 percentage points depending on location.

Hakata-ku stands out as the top-performing district, delivering gross yields of 6-10% for well-positioned properties. This area benefits from its proximity to Hakata Station, the city's main transportation hub, attracting business travelers, commuters, and young professionals. Airbnb properties in Hakata-ku generate average monthly revenue of ¥339,000 with occupancy rates around 87%.

Chuo-ku, the city's business center, offers yields of 6-8% with strong rental demand from office workers and expatriates. Properties here command higher rents but also require higher initial investment, with Airbnb units earning approximately ¥360,000 monthly.

Higashi-ku provides middle-tier yields of 5-7%, offering a balance between rental returns and affordability. This area attracts families and longer-term residents, with Airbnb properties generating around ¥216,000 monthly revenue and 78% occupancy rates.

Suburban areas typically yield 3-5%, reflecting lower rental rates and reduced demand. While initial property prices are more affordable, investors must factor in longer commute times for tenants and potentially higher vacancy rates of 6-8% compared to central districts' 0-2%.

What are the average purchase prices including all costs in Fukuoka?

Fukuoka property prices remain competitive compared to Tokyo and Osaka, though buyers must budget 5-10% additional costs beyond the listed price.

Transaction costs include agent commission (3% plus ¥60,000 plus 10% tax), registration and license tax (0.4-2%), acquisition tax (3-4% of assessed value), and stamp duty (¥10,000-¥60,000). Legal and closing fees typically add ¥100,000-¥200,000 to the total cost.

Annual fixed asset tax runs approximately 1.4% of the assessed value, while condominium maintenance fees range ¥15,000-¥30,000 monthly. Fire insurance starts at ¥10,000 for two years for small units but can reach ¥800,000 over ten years for larger detached homes.

How do monthly costs impact net rental yields in Fukuoka?

Monthly carrying costs typically reduce gross yields by 0.5-1.5 percentage points, significantly impacting overall investment returns.

Maintenance fees for condominiums range ¥15,000-¥30,000 monthly, with older buildings sometimes charging less but potentially requiring special assessments for major repairs. Investors should carefully examine the building's sinking fund adequacy before purchasing to avoid unexpected large expenses.

Property tax averages 1.4% of assessed value annually, translating to approximately ¥850,000 yearly for a ¥50 million property. This represents roughly ¥70,000 monthly that must be deducted from rental income when calculating net yields.

Fire insurance costs vary dramatically by property type and coverage period. Small apartments might require only ¥10,000 for two years minimum coverage, while comprehensive insurance for detached houses can cost ¥800,000 over ten years, representing significant ongoing expenses.

Additional costs include property management fees (5-10% of rental income if using professional management), vacancy provisions (typically 1-2 months annually), and periodic maintenance and repairs. These combined expenses mean that a property showing 6% gross yield might deliver only 4.5-5% net yield after all costs.

What mortgage rates are available for property investors in Fukuoka?

Fukuoka benefits from some of the world's lowest mortgage rates, creating exceptional leverage opportunities for property investors.

Japanese citizens and permanent residents access variable rates starting from 0.18% and reaching up to 1.5%, with fixed rates ranging 1.5-3.83% for terms between 5-35 years. These historically low rates enable positive leverage strategies where rental income exceeds borrowing costs by substantial margins.

Foreign investors face slightly higher rates but still benefit from extremely competitive financing. Variable rates for foreigners typically range 1.0-1.5%, while fixed rates span 1.5-3.0%. Banks often require 30-50% down payments from foreign buyers compared to 20% for Japanese nationals, but the low rates still support strong cash-on-cash returns.

These favorable borrowing conditions significantly enhance investment profitability. A property yielding 6% gross with a 2% mortgage rate provides substantial positive spread, allowing investors to use leverage to amplify returns while maintaining positive cash flow from day one.

It's something we develop in our Japan property pack.

What are the current vacancy rates in Fukuoka by property type?

Fukuoka maintains low vacancy rates overall, with significant variation between central and suburban locations.

The citywide vacancy rate stands at 5.1% as of Q2 2025, trending downward due to continued population growth and economic development. Central districts maintain near-zero vacancy rates of 0-2%, reflecting strong demand from professionals, students, and business travelers concentrated in core areas.

Suburban areas experience higher vacancy rates reaching 6-8%, particularly for larger family properties that appeal to a narrower tenant pool. Entry-level properties in these areas may face extended vacancy periods, requiring investors to budget for 1-2 months of lost rental income annually.

Short-term rental properties show strong performance with average occupancy rates of 84% for Airbnb listings citywide. However, this masks significant variation, with prime central locations achieving 87% occupancy while suburban short-term rentals may struggle to reach 60-70%.

Studios and one-bedroom units experience the fastest turnover and re-letting, typically finding new tenants within 2-4 weeks in central areas. Larger houses may require 2-3 months to find suitable tenants, particularly in suburban locations or during slower seasons.

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What types of tenants are most common in Fukuoka?

Fukuoka's rental market is dominated by young professionals and students, with 65% of properties being studios or one-bedroom units housing 1-2 occupants.

Young professionals represent the largest tenant segment, seeking convenient locations near business districts and transportation hubs. These tenants typically prefer modern amenities, short commutes, and flexible lease terms, making central studios and one-bedroom apartments highly desirable.

Students form another crucial segment, particularly around Kyushu University and other educational institutions. Student tenants often accept smaller spaces and basic amenities in exchange for affordable rents and proximity to campuses, supporting strong demand for budget-friendly studios.

Small families and group renters occupy two to three-bedroom apartments, often staying longer than single tenants but requiring family-friendly neighborhoods with schools and parks nearby. These tenants provide more stable income but may have specific requirements that limit property appeal.

Short-term rental guests include business travelers, tourists, and domestic visitors, with 15.9% of Airbnb stays lasting 30+ days. This indicates significant demand from extended-stay professionals and international students seeking flexible accommodation during transitions.

Multi-generational Japanese families and expatriate families typically rent houses, requiring larger spaces with gardens and parking. While this segment offers longer tenancies, the smaller tenant pool can result in longer vacancy periods between lets.

What are realistic rental income examples for different property sizes?

Rental income varies significantly between central and suburban locations, with property type and management approach affecting returns.

Central district properties command premium rents due to proximity to business centers, transportation, and amenities. A well-located studio in Hakata-ku can generate ¥70,000-¥90,000 monthly through traditional leasing or up to ¥339,000 monthly via Airbnb with proper management.

Suburban properties offer lower absolute income but may provide better value relative to purchase prices. However, longer vacancy periods and higher tenant acquisition costs can offset the apparent yield advantages.

How do short-term rentals compare to long-term leases in Fukuoka?

Short-term rentals significantly outperform long-term leases in central districts but require more active management and regulatory compliance.

Airbnb properties in prime locations generate 8-12% gross yields compared to 4-6% for traditional rentals. A studio in Hakata-ku earning ¥70,000 monthly through long-term rental might generate ¥339,000 monthly via Airbnb, representing nearly 5x the income potential.

However, short-term rentals face regulatory challenges including strict zoning requirements and minimum stay rules. Properties must comply with local accommodation business laws, obtain proper licensing, and may face restrictions on operating days or guest capacity.

Occupancy rates vary significantly by location and season. Central districts maintain 83-87% occupancy rates, while suburban properties struggle to achieve 60-70%. Seasonal fluctuations can create income volatility that long-term rentals avoid.

Management intensity differs substantially between strategies. Long-term rentals require minimal ongoing attention once tenanted, while Airbnb properties need daily guest communication, frequent cleaning, maintenance coordination, and platform management.

Central apartments prove most suitable for short-term rental conversion, while houses and large units typically perform better with family tenants seeking stable, long-term accommodation.

We did some research and made this infographic to help you quickly compare rental yields of the major cities in Japan versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.

How have rental prices and yields changed over recent years?

Fukuoka has maintained relatively stable yields while experiencing steady price appreciation driven by economic growth and population influx.

Over the past five years, rental yields have remained within the 4.2-8% range depending on property type and location. House prices have risen approximately 9% year-on-year, causing yields to compress slightly as purchase prices outpaced rental growth.

The past year shows yields declining from 4.34% in 2024 to 4.22% in Q1 2025, reflecting continued price appreciation. However, rents have increased 3-6% due to economic recovery and growing demand from both domestic and international residents.

This trend reflects Fukuoka's success in attracting technology companies, startups, and young professionals, creating sustained rental demand that supports price growth. The city's designation as a Special Economic Zone has accelerated business development and population growth.

Long-term forecasts suggest continued rental increases of 3-6% annually in prime urban areas, though yield compression may continue if property prices rise faster than rents. Investors should focus on locations with strongest demand fundamentals to maintain attractive returns.

It's something we develop in our Japan property pack.

What are the forecasts for rental yields and demand in Fukuoka?

Fukuoka's rental market outlook remains positive through 2035, supported by technology sector growth and favorable demographics.

Short-term forecasts (2026-2030) predict Fukuoka will sustain 4-8% yields depending on property type and location. The city's expanding tech sector and continued inbound migration should support rental demand growth, particularly for modern, well-located properties.

Medium-term projections (2030-2035) show continued urban strength, though demographic headwinds may slow growth in non-urban areas and larger family properties. Central districts should maintain premium demand while suburban markets may face increased competition.

One-year outlook suggests rental rates will continue rising while yields may remain stable or decline marginally in central districts due to ongoing price appreciation. Properties in prime locations with strong tenant appeal should outperform market averages.

Key demand drivers include Fukuoka's role as a startup hub, university enrollment growth, tourism recovery, and government initiatives promoting international business. These factors should support rental demand across multiple tenant segments through the forecast period.

Investors should position for continued urbanization trends, favoring central locations and property types aligned with demographic shifts toward smaller households and flexible living arrangements.

How do Fukuoka's yields compare with other major Japanese cities?

Fukuoka consistently delivers Japan's highest rental yields among major cities, making it the standout choice for yield-focused investors.

Fukuoka leads all major Japanese cities for rental yields, particularly excelling in studio and small apartment segments where yields can reach 8-10%. The city's lower property prices combined with strong rental demand create optimal conditions for cash flow investors.

The smartest investment choices for current market conditions include central city apartments, especially studios and two-bedroom units in prime districts like Hakata and Chuo. Short-term rental strategies work particularly well for yield-focused investors willing to manage actively.

Families seeking value can find attractive suburban properties with lower yields but better appreciation potential. However, the yield differential between central and suburban locations suggests focusing on core urban areas for maximum returns.

It's something we develop in our Japan property pack.

Conclusion

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.

Sources

1. Global Property Guide - Japan Price History
2. Global Property Guide - Japan Rent Yields
3. BambooRoutes - Average Rent Japan
4. Airbtics - Fukuoka Airbnb Revenue
5. BambooRoutes - Average House Price Japan
6. Taxes for Expats - Japan Property Guide
7. BambooRoutes - Fukuoka Price Forecasts
8. AirROI - Fukuoka Market Report
9. BBC - Fukuoka Innovation City
10. Airbtics - Best Asian Airbnb Markets