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Yes, the analysis of Tokyo's property market is included in our pack
Thinking about buying a 3-bedroom apartment in Shibuya? It’s a vibrant area, but you're probably wondering: is now the right time to buy, or should you wait for prices to drop?
And what about long-term investment—should you look into other wards like Minato or Chiyoda where property values might appreciate more over time?
In this article, we’ll answer these questions. We know this market quite well - and we have put all our knowledge in the Japan Property Pack.
Will property prices increase in Tokyo in 2025?
Yes, property prices in Tokyo are expected to rise in 2025, driven by a combination of high demand and a limited supply of housing.
Backed by our fresh, in-depth market analysis, we’re confident that Tokyo remains one of the hottest cities globally for both domestic and international investors.
Sure, there are some economic bumps like inflation and rising interest rates, but the main drivers behind Tokyo’s price growth aren’t going anywhere.
Demand, especially in the prime central areas, still outstrips supply by a mile, making any major price dips a long shot. And let’s not forget—Tokyo’s status as a cultural, financial, and political hub keeps drawing in buyers from around the world.
Signals pointing to a property price increase in Tokyo
Here are some factors suggesting prices could increase:
The ongoing urban redevelopment projects in Tokyo are expected to enhance the city's infrastructure and livability, attracting more residents and investors, which could drive up property prices.
Tokyo's population continues to grow, with an influx of both domestic and international residents seeking housing in the city, thereby increasing demand for properties.
The limited availability of land for new developments in central Tokyo means that existing properties are likely to see an increase in value due to scarcity.
Tokyo's strong economic performance and status as a global financial hub continue to attract business investments, which in turn boosts the real estate market.
The Japanese government's policies to encourage foreign investment in real estate are expected to bring more international buyers into the Tokyo market, increasing competition and prices.
The upcoming international events and conferences scheduled in Tokyo are likely to boost tourism and short-term rental demand, indirectly supporting property price growth.
Technological advancements and smart city initiatives in Tokyo are making the city more attractive to tech-savvy buyers, potentially driving up property values.
Signals pointing to a property price decrease in Tokyo
Here are some factors suggesting prices could fall:
Rising construction costs and labor shortages could slow down new housing developments, potentially limiting supply and affecting market dynamics.
Economic uncertainties, such as potential global recessions or financial market volatility, could impact buyer confidence and reduce demand for properties.
Increased interest rates could make mortgages more expensive, potentially deterring some buyers and cooling off the property market.
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If property prices go up in Tokyo, how much would they increase by?
If real estate prices in Tokyo were to rise in 2025, the increase would likely be around 3% to 7% of their 2024 values.
Typically, real estate in dynamic, mature markets like Tokyo appreciates by approximately 2% to 7% annually over the long term. However, fluctuations can occur depending on factors such as district, season, and property type.
It means that, if you spot a charming 2-bedroom apartment in Shibuya for 90,000,000 yen today, don't be surprised if it's priced between 92,700,000 and 96,300,000 yen this time next year.
To give you a better understanding, here is a table that shows 7 types of Tokyo real estate properties, their estimated prices in 2024, and projections for 2025 based on potential price increases of 2%, 5%, and 7%.
| Type of Property | Average Price in 2024 (¥) | Price in 2025 (2% increase) | Price in 2025 (5% increase) | Price in 2025 (7% increase) |
|---|---|---|---|---|
| Modern Apartment (60 sqm / 646 sqft) | ¥90,000,000 | ¥91,800,000 | ¥94,500,000 | ¥96,300,000 |
| Luxury Apartment (75 sqm / 807 sqft) | ¥120,000,000 | ¥122,400,000 | ¥126,000,000 | ¥128,400,000 |
| Penthouse (100 sqm / 1,076 sqft) | ¥250,000,000 | ¥255,000,000 | ¥262,500,000 | ¥267,500,000 |
| Studio (30 sqm / 323 sqft) | ¥45,000,000 | ¥45,900,000 | ¥47,250,000 | ¥48,150,000 |
| Loft (80 sqm / 861 sqft) | ¥160,000,000 | ¥163,200,000 | ¥168,000,000 | ¥171,200,000 |
| Townhouse (150 sqm / 1,615 sqft) | ¥350,000,000 | ¥357,000,000 | ¥367,500,000 | ¥374,500,000 |
| Investment Property (50 sqm / 538 sqft) | ¥75,000,000 | ¥76,500,000 | ¥78,750,000 | ¥80,250,000 |
Everything you need to know is included in our Property Pack for Tokyo
If real estate prices go up in Tokyo, which areas are likely to see the biggest increases?
Today, people who want to move to Tokyo seek a blend of traditional charm and modern conveniences, which Shibuya offers. Hence, we could see a price increase there in 2025.
Also, lately, there's been a shift toward more youthful, vibrant neighborhoods, and Shimokitazawa has really taken off.
We like it when information is clear and easy to digest. So, here’s a table that highlights the areas where prices might rise the most, along with the reasons behind those expected increases. It’s very high-level. If you want more details on a specific area, please check our real estate pack tailored to the Tokyo market.
| Neighborhood | Level of Increase | Why |
|---|---|---|
| Shibuya | High | Recent development of luxury housing projects and its increasing appeal to international buyers as travel normalizes post-pandemic, driving demand. |
| Ginza | High | Expected rise due to limited housing stock, upcoming renovations to heritage buildings, and growing demand for prime properties in central Tokyo. |
| Nakameguro | Medium-High | Ongoing gentrification and new transport links, along with several planned redevelopment projects in the area, are likely to push prices higher. |
| Roppongi | Medium | The shift towards hybrid workspaces is driving demand for residential properties near business districts, combined with new mixed-use developments. |
| Kichijoji | Medium-High | Eco-friendly urban projects and recent construction of new schools and parks are increasing its attractiveness for families, pushing prices upward. |
| Asakusa | Medium | Investment in local infrastructure, such as the extension of tram lines and renovation of historic areas, is boosting long-term value. |
| Daikanyama | Medium-High | With new cultural and commercial spaces being developed, this trendy neighborhood is seeing increased demand from both residents and investors. |
| Shimokitazawa | High | Upcoming large-scale urban regeneration projects and improved public transport access are expected to make this area more desirable. |
| Odaiba | Medium-High | Its proximity to central Tokyo, along with new office and residential developments, makes it increasingly attractive to professionals seeking more space. |
| Ikebukuro | Medium | Gentrification and cultural regeneration projects are attracting new residents, leading to rising prices as the area becomes more fashionable. |
| Aoyama | High | As new luxury developments are launched, demand for premium housing among wealthy buyers is expected to further increase property values. |
| Marunouchi | High | Upcoming restoration of historic buildings and high-profile cultural projects are driving a renewed focus on this central, historic location. |
-The best areas to buy a property in Tokyo
If I'm looking to invest in real estate, what types of properties should I focus on for the best value appreciation in Tokyo?
In 2025, Tokyo real estate trends focus on tech-smart, energy-efficient apartments, larger suburban homes for families, properties with outdoor spaces, and eco-friendly buildings—all driving higher demand and prices. Here is a summary.
- Tech-Equipped and Energy-Efficient Apartments:
Driven by remote work and sustainability trends, these homes offer smart technology features and energy-saving systems. They cater to young professionals and tech workers, making them a hot commodity in 2025.
- Family-Sized Apartments in Suburban Areas:
With a growing demand for larger living spaces, especially among families, suburban areas near Tokyo are seeing increased interest. Proximity to green spaces and schools is a major factor driving value.
- Properties with Outdoor Spaces:
Post-pandemic, outdoor spaces like terraces, balconies, or gardens have become highly desirable. In dense cities like Tokyo, these features offer a much-needed escape and are likely to drive up property values.
- Eco-Friendly Buildings with Low Carbon Footprints:
Tokyo's commitment to sustainability is boosting demand for eco-certified buildings. Buyers are increasingly valuing properties that align with the city’s green goals, leading to price appreciation in this category.
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