Authored by the expert who managed and guided the team behind the Japan Property Pack
Yes, the analysis of Kyoto's property market is included in our pack
Are you considering investing in Kyoto's real estate market? Curious about the trends that will shape property values in 2025? Wondering how economic shifts might impact your buying decision?
We will lay down recent insights, providing you with a clear picture of what's to come. Ici no guesswork, we rely only on solid data to guide your investment choices.
Actually, we know this market inside and out. We keep tabs on it regularly, and all our discoveries are reflected in the most recent version of the Japan Property Pack
1) Kyoto real estate prices will rise due to increasing demand and limited supply
Foreign buyers are increasingly eyeing Kyoto's traditional neighborhoods, pushing up property values.
In fiscal 2023, foreign individuals or entities snapped up 203 properties in Kyoto, showing a clear interest in the city's real estate. These purchases are concentrated in areas like Gion and Arashiyama, known for their cultural and historical significance. The charm of these neighborhoods lies in their unique blend of history and modernity, making them irresistible to international investors.
One reason for the rising prices is the limited availability of land in these historic districts. With little room for new developments, the supply remains tight, and as demand holds steady, prices naturally climb. Gion, for instance, has seen a surge in luxury housing projects, further fueling demand.
Kyoto's allure is often highlighted in media coverage, which paints it as a perfect mix of the old and the new. This makes traditional-style homes with modern amenities highly attractive. Surveys show that foreign buyers have a strong preference for these cultural and historical areas, reinforcing the trend of increased foreign investment.
Insider knowledge suggests that the appeal of Kyoto's traditional neighborhoods is not just about the properties themselves but also the lifestyle they offer. Living in these areas means being part of a community that values heritage and tradition, which is a big draw for many foreign buyers.
As more international investors flock to Kyoto, the city's real estate market is poised for further growth. The combination of limited supply, high demand, and the unique appeal of its traditional neighborhoods makes Kyoto a hot spot for property investment.
Sources: Kyodo News, Bamboo Routes, E-Housing
2) Property prices in Kyoto's Nakagyo ward will steadily rise due to vibrant cultural and commercial activities
Nakagyo ward in Kyoto is buzzing with cultural and commercial activities, making it a prime spot for property investment.
With its lively cultural scene, Nakagyo hosts events that draw both locals and tourists, adding to its charm. This central location is perfect for living and business, and property prices are expected to rise steadily as a result.
Tourism in Kyoto is booming, with 75.18 million visitors in 2023, surpassing pre-pandemic levels. The city itself saw 50.28 million tourists, almost matching 2019 numbers. This influx, especially in central areas like Nakagyo, is set to continue, boosting the area's appeal and driving up property demand.
Nakagyo ward is also seeing a surge in new businesses and commercial developments. Karasuma-Shijo is becoming a hot spot due to its closeness to major shopping areas and public transport. This growth is supported by government investments in infrastructure, enhancing the ward's long-term value.
With these developments, Nakagyo is not just a cultural hub but also a commercial powerhouse. The combination of tourism, business growth, and infrastructure improvements makes it a wise choice for property buyers.
Sources: Average Listing Price of Resale House in Kyoto by Ward, Kyoto Pref. Visitor Numbers in 2023 Exceed Pre-Pandemic Level, 2025 Japan Property Market Insights, Will real estate prices in Kyoto go up in 2025?
Everything you need to know is included in our Property Pack for Kyoto
3) Kyoto residential property prices will rise as the city stays a cultural and educational hub
Kyoto is a magnet for those seeking a blend of culture and education, driving a strong demand for housing.
With its prestigious universities and thriving tech scene, the city attracts a mix of students and professionals, boosting the residential property market. Kyoto's commitment to welcoming international students and expatriates further fuels this demand.
Land scarcity, especially in central and historic areas, plays a big role in the city's rising property prices. Strict historical preservation laws mean new constructions are limited, making existing properties, like the charming machiya, even more valuable.
There's a noticeable trend of people, both locals and foreigners, being drawn to Kyoto's traditional architecture. This desire for authentic Japanese living, coupled with a booming tourism industry, pushes property values higher in tourist hotspots.
Short-term rentals are thriving thanks to the influx of tourists, which in turn, elevates property prices in popular areas. This dynamic creates a lucrative market for property investors looking to capitalize on the city's appeal.
Overall, residential property prices in Kyoto are set to keep climbing as the city remains a cultural and educational hub, making it a prime location for real estate investment.
Sources: Kyoto Price Forecasts, Kyoto Prefecture, Kyoto Real Estate Market
4) Arashiyama property values will rise as eco-tourism and nature-focused living gain popularity
The Arashiyama area is becoming a hotspot for eco-tourism and nature-focused living.
In March 2023, Kyoto welcomed around 4.91 million tourists, many of whom were drawn to its eco-tourism offerings. Arashiyama, with its stunning natural landscapes and rich cultural heritage, is a major attraction. This surge in visitors is fueling a demand for accommodations that blend traditional charm with modern, eco-friendly features.
Kyoto's commitment to preserving its cultural heritage while promoting sustainable tourism is evident in the rising interest in traditional-style homes equipped with modern amenities. This trend is attracting both local and international buyers, especially those who can work remotely and are looking for a lifestyle that combines tradition with modernity.
Government efforts, like the Kyoto Tourism Promotion Plan 2025, are pushing for sustainable tourism, which is expected to boost property values in eco-friendly areas such as Arashiyama. The plan includes developing green spaces and parks, underscoring the area's dedication to sustainability.
As more people seek environmentally conscious living, the demand for properties in Arashiyama is likely to rise. The area's focus on eco-friendly infrastructure and sustainable practices makes it an attractive option for those wanting to live in harmony with nature.
With the growing popularity of eco-tourism and the increasing appeal of nature-focused living, Arashiyama is poised for a rise in property values. This trend is drawing in buyers who value sustainability and cultural richness.
Sources: Statista, Kyoto Price Forecasts, APTEC
5) Kyoto real estate prices will rise due to increasing demand and limited supply
Kyoto is ramping up efforts to boost affordable housing options.
With initiatives like "tokkochin housing" and partnerships with private developers, the government aims to provide more homes for middle-class and low-income families. This isn't just a local trend; cities worldwide have seen property prices stabilize or even dip when housing supply increases. Take Tokyo, for instance, where a rise in housing availability has helped keep prices in check.
In Kyoto, the expected surge in affordable housing could cater to a wider range of buyers, potentially easing the pressure on higher-end property prices. As more people find affordable options, the demand for pricier properties might decrease. This shift is particularly relevant given Kyoto's aging population and urbanization trends, which are driving a need for diverse housing types.
These changes could lead to a slight decrease in average property prices as the supply grows. The city's efforts are not just about numbers; they're about meeting the evolving needs of its residents. With more affordable housing, Kyoto is positioning itself to accommodate a broader demographic, which could have a ripple effect on the entire property market.
For potential buyers, this means more options and possibly better deals. As the market adjusts to these new developments, it's an exciting time to consider investing in Kyoto. The city's blend of tradition and modernity, coupled with these housing initiatives, makes it a unique place to call home.
Sources: E-Housing Japan, Kyoto Prefecture, Rabobank
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6) Kyoto outskirts will see property prices rise as more people choose suburban living
The outskirts of Kyoto are seeing a steady rise in property prices as more people opt for suburban living.
Remote work is a big factor here, pushing folks to find a sweet spot between city life and nature. Kyoto's compact city layout and easy access to nature make it a perfect fit for this lifestyle change.
With property prices in central Kyoto climbing, many are eyeing the outskirts for more budget-friendly options. Improved transportation, like extended tram lines, makes commuting easier, boosting the appeal of suburban living.
Demographics are shifting too. Younger families are moving to the suburbs for bigger, more manageable homes. This change is helping property values grow in these areas.
New amenities and services are popping up, making the suburbs even more attractive. Eco-friendly projects and new schools are drawing families to these areas.
Sources: Digital Nomad Exchange, Kyoto Price Forecasts, Kyoto Real Estate Market
7) Sakyo ward property values will decline as its distance from central Kyoto becomes less desirable for commuters
With the rise of remote work, commuting is becoming less necessary, especially in areas like Sakyo ward, which is further from central Kyoto.
In 2023, a survey by Doda found that over half of respondents were allowed to work remotely, and more than a quarter were actively doing so. This shift means fewer people need to travel long distances for work, making places like Sakyo less attractive for those who once commuted daily.
Transportation costs are climbing across Japan, and while we don't have specific numbers for Kyoto, the trend is clear: higher commuting costs make longer commutes less appealing. This could deter potential residents from choosing Sakyo ward if they want to save on travel expenses.
People are increasingly choosing to live closer to their workplaces. In 2023, many preferred hybrid work or working from home, with a strong preference for company-approved locations. This change in workstyle means living near work is more desirable, which might reduce interest in properties in outer areas like Sakyo.
Central Kyoto is seeing a boost in infrastructure and amenities, thanks to the city's efforts to preserve its cultural heritage and improve urban living. These enhancements make central areas more attractive, potentially drawing more residents and businesses away from Sakyo ward.
As central Kyoto becomes more appealing, Sakyo ward's distance from the city center could make it less desirable for those who prioritize convenience and accessibility.
Sources: Mailmate, Kyoto Price Forecasts, CIEE
8) Yamashina ward residential property prices will rise due to its proximity to Kyoto and Osaka
Yamashina ward is gaining popularity because it's perfectly situated between Kyoto and Osaka.
With excellent transport links, residents find it easy to commute to both cities, making Yamashina a hot spot for homebuyers. This convenience is a major reason why property prices are on the rise here.
Central Kyoto's property prices have skyrocketed, pushing buyers to look for more affordable options. Yamashina offers a sweet spot with its suburban charm and easy access to urban life, attracting those who want the best of both worlds.
Yamashina's transportation infrastructure has seen some serious upgrades. New public transport links and better roads have made the area more accessible, which is a big draw for both residents and investors. This improved connectivity is a game-changer for property values.
Living in Yamashina means you can enjoy a quieter suburban life without sacrificing the perks of city living. The area's strategic location and enhanced transport options make it a smart choice for those looking to invest in property.
Sources: Heritage Homes Japan, Global Property Guide
Everything you need to know is included in our Pack for Kyoto
9) Kyoto's luxury rental yields will decline as high-end tenants seek cheaper options
Kyoto's luxury rental market is seeing some shifts that might affect rental yields.
One big issue is the rising vacancy rates in luxury rentals. When you see more empty apartments, it usually means fewer people are interested in renting them. This can be a sign that demand is dropping, which isn't great news for landlords.
There's also been a boom in the construction of luxury apartments in Kyoto. With too many high-end places popping up, it can lead to an oversupply. More apartments than renters often means landlords have to lower prices to fill those spaces.
On top of that, the rise of short-term rental options like Airbnb in Kyoto is giving people more flexible and often cheaper alternatives. This trend is pulling potential tenants away from traditional long-term luxury rentals, as they opt for these more affordable choices.
For those considering buying property in Kyoto, it's worth noting these dynamics. The market is shifting, and understanding these trends can help you make a more informed decision.
Sources: Real Estate Japan, Airbtics
10) Kyoto real estate prices will rise due to increasing demand and limited supply
In Kyoto's university districts, rental yields are set to rise as student numbers keep climbing.
Kyoto University, a major draw for students, had 22,455 students in 2023, and this number is expected to grow. With more students enrolling, the demand for housing naturally increases, especially in popular areas like Gion and Shijo-Kawaramachi.
Both local and international students are flocking to Kyoto, boosting the need for housing near universities. This surge in demand is causing rental prices to climb, as the supply of available housing struggles to keep up.
On-campus housing at Kyoto University is limited, which means many students look for off-campus options. This scarcity of on-campus accommodation is a key factor in the rising rental prices in nearby areas.
Kyoto University is expanding its academic programs and facilities, which is likely to attract even more students. This expansion will further increase the demand for off-campus rentals, pushing rental yields higher.
With the university's growth and the influx of students, investing in property around these districts could be a smart move. The combination of high demand and limited supply is a recipe for increased rental yields.
Sources: Times Higher Education, EduRank, Kyoto Price Forecasts
11) Kyoto real estate prices will rise due to increasing demand and limited supply
Suburban areas of Kyoto are experiencing a boom in new housing developments.
This surge in housing means more rental properties are available, leading to landlords competing fiercely for tenants. When there are more homes than renters, landlords often have to lower their rental prices to attract people, which results in reduced rental yields.
Long-term rental options are also on the rise in these suburbs. While this might seem like a good thing for attracting tenants, it actually means increased competition among landlords. With more choices, tenants can be picky, forcing landlords to drop prices to secure renters, which further cuts into rental yields.
Adding to the challenge is Kyoto's slowing population growth. With fewer people moving in, the demand for rentals is dropping. This makes it tough for landlords to fill their properties, often leading them to lower prices to attract tenants, which again impacts rental yields.
Reports are showing a dip in rental prices in these suburban areas, a clear sign of lower rental yields. This drop is largely due to the increased competition among landlords and the reduced demand. As more properties are available for long-term leases, maintaining high rental prices becomes a struggle.
Sources: Global Property Guide, World Bank Document
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12) Kyoto real estate prices will rise due to increasing demand and limited supply
Rental yields in Kyoto's central districts are on the rise thanks to the strong demand for short-term rentals by tourists.
Kyoto has become a hotspot for travelers, with its rich cultural and educational attractions drawing in more visitors each year. This trend is set to continue, as the Kyoto Tourism Promotion Plan 2025 aims to enhance the quality of tourism and attract even more visitors.
Short-term rental bookings are booming. According to Airbnb, a typical short-term rental in Kyoto is booked for 292 nights a year, boasting a high median occupancy rate of 80%. This shows a strong demand for these accommodations, which supports higher rental yields.
Central districts like Gion and Shijo-Kawaramachi are tourist favorites, thanks to their blend of traditional charm and modern amenities. These areas are expected to see significant price increases, further boosting rental yields.
The Japanese property market is also on the upswing, which bodes well for the tourism sector. This growth enhances the appeal of short-term rentals in Kyoto, making them a smart investment.
Sources: Airbtics, Kyoto City Tourism Association, E-Housing
13) Kamigyo ward property values will drop due to an aging population and surplus homes
In Kamigyo ward, 26.4% of the population is aged 65 and over, highlighting a significant elderly demographic.
This aging trend is partly due to Japan's low birth rate of 1.32 in 2022, which means fewer young people are entering the population. As older residents pass away or move to care facilities, this can lead to a surplus of homes.
Young people in Japan often migrate to other areas, and this trend is noticeable in Kamigyo. With fewer young families moving in, the surplus of available homes continues to grow.
In Kamigyo, the combination of an aging population and youth migration is creating a unique real estate scenario. Potential buyers might find more options as the number of available homes increases.
For those considering buying property, this surplus could mean more competitive pricing. However, it's essential to consider the long-term implications of an aging community.
Sources: City Population, E-Housing
14) Kyoto real estate prices will rise due to increasing demand and limited supply
The Nishijin district in Kyoto is seeing a drop in property prices.
This is largely because the traditional weaving industry is losing its appeal among young people. Once a vital part of Nishijin's identity, the industry now struggles as fewer young individuals choose to enter this field.
Adding to the challenge, the district has an aging population, which means fewer people are available to continue the weaving tradition. This shift not only shrinks the workforce but also reduces the pool of potential property buyers.
Young people in Japan are increasingly drawn to modern industries over traditional crafts. Many are moving to urban centers or other regions for better job prospects and a more contemporary lifestyle, further decreasing Nishijin's population.
This migration trend is causing a decline in property demand in the area. As young residents leave, the need for housing diminishes, leading to lower property prices.
Sources: IJIH, Global Property Guide, Kyoto Price Forecasts
Everything you need to know is included in our Property Investment Pack for Kyoto
15) Gion property values will surge as demand for traditional machiya houses rises among cultural enthusiasts
The historic Gion district in Kyoto is about to see a significant rise in property values due to the growing interest in traditional machiya houses.
These machiya homes are more than just structures; they are a living piece of Japan's cultural history. This unique charm is attracting both local and international buyers who want to own a slice of this heritage. Foreign investors are particularly keen, viewing these properties as both a cultural and financial investment.
One of the reasons for this interest is that Japan allows foreigners to purchase freehold properties without major restrictions, making it a hot market for international buyers. Many of these homes are being transformed into galleries, cafes, and hotels, which adds to their appeal and functionality.
The Gion district is a major tourist magnet, drawing over 50 million visitors each year. This influx of tourists boosts the demand for short-term rental properties, including machiya houses. The area's traditional allure, especially its famous geisha culture, makes it even more attractive to cultural enthusiasts.
Kyoto is actively working to preserve its cultural heritage while improving urban infrastructure, which further enhances its appeal to potential buyers. The city's efforts are making it a more attractive place for those looking to invest in property.
Sources: Heritage Homes Japan, Tablet Hotels Magazine, Real Estate Japan, Kyoto Price Forecasts
16) Kyoto will see a demographic shift with more international students and expatriates moving to the city
Kyoto is quickly becoming a hotspot for international students and expatriates.
One big draw is the surge in international student enrollment at Kyoto's universities. For instance, the Kyoto College of Graduate Studies for Informatics expanded its capacity in 2024, aiming to attract more students from abroad. This aligns with Japan's broader goal to welcome more international students, positioning Kyoto as a key player in this initiative.
There's also a noticeable rise in expatriate work visas in Japan, with over 3.4 million foreign residents recorded in 2023. This trend suggests that Kyoto is seeing more expatriates, supported by the growth of international schools and services tailored for foreign residents.
The Japanese government is actively working to bring in international talent through programs like the specified skilled worker initiative. These efforts, combined with Kyoto's rich cultural and historical allure, make the city an appealing choice for both students and expatriates.
Kyoto's charm isn't just in its temples and traditions; it's also in its growing international community. The city is adapting to meet the needs of its new residents, offering a blend of modern amenities and cultural experiences.
As more people from around the world choose to call Kyoto home, the city is poised for a dynamic demographic transformation, reflecting a blend of global influences and local heritage.
Sources: The PIE News, Kyodo News, The Japan Times, KCGI News
17) Kyoto real estate prices will rise due to increasing demand and limited supply
Younger professionals are flocking to Kyoto, transforming the city into a vibrant hub.
In recent years, Kyoto has seen a surge in international students and technical interns choosing to live in its central areas. This shift is significant because these young professionals are drawn to urban settings that offer both career opportunities and modern living conditions. They are not just looking for a place to stay; they want a lifestyle that includes vibrant city life and career growth.
Kyoto is rapidly becoming a center for tech and creative industries, with a noticeable increase in coworking spaces and startup hubs. Spaces like Co-nnect Kyoto and Impact Hub Kyoto are leading the charge, showing the city's dedication to innovation and new business support. These environments are particularly appealing to younger professionals who thrive in collaborative settings.
Surveys reveal that younger professionals prefer modern apartments with amenities like high-speed Wi-Fi and communal areas. This preference aligns with the offerings of many coworking spaces in Kyoto, indicating a rising demand for modern apartments in central locations. The real estate market is responding to this influx, with more modern apartments popping up to meet the needs of these young professionals.
Central Kyoto's urbanization and improved infrastructure make it even more appealing. Its central location provides excellent access to public transport and job opportunities, making it a top choice for younger professionals. This trend mirrors what's happening in other major Japanese cities like Tokyo and Osaka, where central areas are highly desirable for the younger crowd.
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18) Properties near the Keihan railway extension will significantly increase in value due to better accessibility
Properties near the planned extension of the Keihan railway line are set to rise in value thanks to better accessibility.
Take a look at what happened with the Kita-Osaka Kyuko Line. When it was extended, property prices within 500 meters of the new stations jumped 1.5 times in just three years. Rental rates also climbed by 18.9% during that time. This isn't just a fluke; it's a trend. New railway lines make nearby areas more attractive, pushing up both property values and rents.
Improved transport links are a big deal for property values. Real estate experts say better access to transportation makes areas more appealing to potential residents. This increased interest naturally boosts property prices. The Keihan Group's 2023 report backs this up, showing confidence in the economic perks of their railway expansions, including rising property values.
When people can easily get around, they’re more likely to move to those areas. This is why transportation improvements often lead to higher demand for nearby properties. The Keihan railway extension is expected to follow this pattern, making properties in the area more desirable.
So, if you're thinking about buying property, keep an eye on areas near the new Keihan line. These spots are likely to see a boost in value as the railway extension progresses. It's a smart move to consider these locations for future investment.
Sources: Keihan Group, RE/MAX Apex, UCLA Anderson
19) Kyoto real estate prices will rise due to increasing demand and limited supply
In Kyoto, smart home technology is quickly becoming a must-have in new residential developments.
Imagine living in a home where everything from lights to security systems is connected and easily controlled. This is becoming a reality in Japan, where the smart home market is booming. Back in 2023, it was worth $6.79 billion, and it's on track to hit $18.90 billion by 2032. This isn't just a trend; it's a transformation, with an annual growth rate of over 12% starting from 2024.
Why the surge? People are craving tech-savvy homes. By 2025, nearly 9 million Japanese homes will be smart homes. It's not just homeowners; renters are on board too, with 82% wanting at least one smart device or system in their living spaces. This demand is reshaping the housing market, making smart features a key selling point.
But it's not just about convenience. The Japanese government is pushing for smart city developments, which include energy-efficient homes. This aligns perfectly with the smart home tech focus on power conservation and sustainability. The government is actively promoting energy-saving measures, making smart homes even more appealing.
Backing this up, the Ministry of Trade, Economy, and Industry has endorsed specific protocols for smart home equipment. This means that the technology isn't just a fad; it's supported at the highest levels, ensuring that these homes are not only smart but also reliable and efficient.
For anyone considering buying property in Kyoto, these developments mean that smart home technology is not just an added bonus but a standard feature that enhances property appeal. It's a shift that's here to stay, making homes more attractive to tech-savvy buyers and renters alike.
Sources: GlobeNewswire, Exploding Topics, Market Research
This article gives you valuable insights, but remember, it’s not and will never be investment advice. We pull data from a range of sources to provide you with the most accurate picture possible, yet we can’t guarantee complete accuracy. Markets are difficult to predict. Make sure to do your own research and consult a professional before making any financial moves. Any risks or losses are your own responsibility.