Authored by the expert who managed and guided the team behind the Japan Property Pack
Yes, the analysis of Tokyo's property market is included in our pack
Tokyo's rental market remains one of the most liquid and stable in Asia, but understanding what yields you can realistically expect is essential before investing.
This article breaks down gross and net rental yields, neighborhood variations, property types, and all the costs that eat into your returns in Tokyo.
We constantly update this blog post to reflect the latest market conditions and data.
And if you're planning to buy a property in this place, you may want to download our pack covering the real estate market in Tokyo.
Insights
- Tokyo's average gross rental yield sits around 3.8% in early 2026, which is lower than many global capitals because property prices have surged faster than rents.
- Net yields in Tokyo typically land between 2.0% and 3.4%, with condo management fees and repair reserves being the single biggest cost that drags down returns.
- Outer wards like Adachi and Katsushika can deliver gross yields of 4.6% to 6.0%, while prime central areas like Minato and Shibuya often stay below 3.5%.
- Tokyo's rental vacancy rate is only around 3.5% in the 23 wards, meaning landlords rarely struggle to find tenants even if turnover creates occasional gaps.
- Smaller units like studios and 1K apartments consistently outperform larger family apartments on yield because rent per square meter stays stronger as unit size shrinks.
- The TAKANAWA GATEWAY CITY project near Shinagawa, which opened in March 2025, is already lifting rental demand in nearby residential pockets.
- Average condo fees in Greater Tokyo total around 25,000 yen per month, which translates into a meaningful haircut on net yield that many investors underestimate.
- A gross yield of 4.5% or higher is generally considered "good" in Tokyo, but achieving it usually means buying older buildings or targeting outer commuter wards.
What are the rental yields in Tokyo as of 2026?
What's the average gross rental yield in Tokyo as of 2026?
As of early 2026, the average gross rental yield for residential property in Tokyo sits at approximately 3.8%, covering a mix of apartments, condos, houses, and small multi-unit buildings across the 23 wards.
Most typical Tokyo investment properties fall within a realistic gross yield range of 3.3% to 4.6%, depending on location, building age, and unit size.
Compared to other major Japanese cities, Tokyo's gross yields are on the lower end because the capital commands premium property prices that outpace rental growth.
The single biggest factor influencing Tokyo gross rental yields right now is the continued surge in condo and land prices, which compresses yields even as rents stay firm thanks to high occupancy.
What's the average net rental yield in Tokyo as of 2026?
As of early 2026, the average net rental yield in Tokyo comes in at approximately 2.6% after accounting for all recurring ownership costs.
The typical gap between gross and net yields in Tokyo is around 1.0 to 1.4 percentage points, which is larger than many investors expect when they first look at the market.
The expense category that most significantly reduces gross yield in Tokyo is owner-paid condo fees, specifically the monthly management fee and repair reserve fund, which average around 25,000 yen per month in Greater Tokyo resales.
Net yields for most standard Tokyo investment properties realistically range from 2.0% to 3.4%, with the variation driven by building age, condo fee levels, and how efficiently you manage vacancies and repairs.
By the way, you will find much more detailed rent ranges in our property pack covering the real estate market in Tokyo.
We made this infographic to show you how property prices in Japan compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
What yield is considered "good" in Tokyo in 2026?
In Tokyo's rental market, a gross yield of around 4.5% or higher is generally considered "good" by local investors, though achieving this typically requires targeting outer wards, older buildings, or smaller units near commuter rail lines.
The threshold that separates average properties from high performers in Tokyo sits at roughly 5.5% gross, but reaching that level usually involves trade-offs like shorter remaining building life, less prestigious micro-locations, or more hands-on management.
How much do yields vary by neighborhood in Tokyo as of 2026?
As of early 2026, the spread in gross rental yields between Tokyo's highest-yield and lowest-yield neighborhoods is substantial, ranging from around 2.7% in prime central wards to as high as 6.0% in outer commuter areas.
The highest rental yields in Tokyo typically come from neighborhoods with strong commuter rail access but lower prestige pricing, such as Kita-Senju in Adachi, Kanamachi in Katsushika, and Kamata in Ota.
The lowest rental yields appear in Tokyo's most prestigious addresses, including Azabu-Juban and Roppongi in Minato, Ebisu and Daikanyama in Shibuya, and the residential pockets near Tokyo Station in Chiyoda and Chuo.
The main reason yields vary so dramatically across Tokyo neighborhoods is that purchase prices in prime areas include a large status and scarcity premium that rents simply cannot match.
By the way, we've written a blog article detailing what are the current best areas to invest in property in Tokyo.
How much do yields vary by property type in Tokyo as of 2026?
As of early 2026, gross rental yields in Tokyo range from around 3.0% for large family apartments in prime wards to over 5.0% for compact studios in outer areas, depending on the property type.
Small apartments like studios and 1K units currently deliver the highest average gross rental yield in Tokyo because their purchase prices per square meter are more favorable relative to the rents they command.
Large family condos, particularly 2LDK and 3LDK units in central Tokyo, deliver the lowest gross yields because they get priced at luxury levels that rents cannot fully support.
The key reason yields differ by property type in Tokyo is that rent per square meter does not scale proportionally with purchase price, so smaller units maintain better math while larger units get squeezed.
By the way, you might want to read the following:
What's the typical vacancy rate in Tokyo as of 2026?
As of early 2026, the rental market vacancy rate in Tokyo's 23 wards sits at approximately 3.5% for professionally managed residential properties, which translates to very tight conditions for landlords.
Vacancy rates vary across Tokyo neighborhoods, with major rail hubs and employment centers seeing rates closer to 2% while some outer residential areas may experience 5% or slightly higher.
The main factor currently driving vacancy rates in Tokyo is the concentration of jobs and transportation infrastructure, which keeps demand strongest near major interchanges like Shinjuku, Ikebukuro, and Shinagawa.
Tokyo's rental vacancy rate is significantly lower than Japan's overall housing vacancy figures, which include second homes and inherited empty properties that are not actively competing in the rental market.
Finally please note that you will have all the indicators you need in our property pack covering the real estate market in Tokyo.
What's the rent-to-price ratio in Tokyo as of 2026?
As of early 2026, the average monthly rent-to-price ratio in Tokyo is approximately 0.32%, which means monthly rent equals about 0.32% of the property's purchase price.
For buy-to-let investors in Tokyo, a monthly rent-to-price ratio above 0.35% is generally considered favorable, and this figure multiplied by 12 gives you the annual gross rental yield directly.
Tokyo's rent-to-price ratio is lower than many other major Asian cities because property prices have risen sharply in recent years while rents have grown more modestly, compressing the return math.
We have made this infographic to give you a quick and clear snapshot of the property market in Japan. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
Which neighborhoods and micro-areas in Tokyo give the best yields as of 2026?
Where are the highest-yield areas in Tokyo as of 2026?
As of early 2026, the top three highest-yield neighborhoods in Tokyo are Kita-Senju in Adachi ward, Kanamachi in Katsushika ward, and Kamata in Ota ward, all offering yields well above the city average.
These high-yield areas in Tokyo typically deliver gross rental yields in the range of 4.6% to 6.0%, depending on building age and exact micro-location within the neighborhood.
The main characteristic these high-yield Tokyo areas share is excellent rail connectivity combined with relatively affordable purchase prices, which creates favorable rent-to-price math that central areas cannot match.
You'll find a much more detailed analysis of the areas with high profitability potential in our property pack covering the real estate market in Tokyo.
Where are the lowest-yield areas in Tokyo as of 2026?
As of early 2026, the top three lowest-yield neighborhoods in Tokyo are Azabu-Juban and Roppongi in Minato ward, Ebisu and Daikanyama in Shibuya ward, and residential pockets near Ginza in Chuo ward.
These low-yield areas in Tokyo typically deliver gross rental yields in the range of 2.7% to 3.5%, which reflects the premium pricing that buyers pay for prestige and location.
The main reason yields are compressed in these Tokyo neighborhoods is that purchase prices include a significant status and scarcity premium that rents, even at high absolute levels, cannot proportionally match.
Buying a property in a low-yield area is one of the mistakes we cover in our list of risks and pitfalls people face when buying property in Tokyo.
Which areas have the lowest vacancy in Tokyo as of 2026?
As of early 2026, the top three neighborhoods with the lowest residential vacancy rates in Tokyo are Shinjuku and Takadanobaba, Ikebukuro in Toshima ward, and the Shinagawa-Takanawa corridor in Minato ward.
These low-vacancy areas in Tokyo typically experience vacancy rates below 3%, and in some cases closer to 2%, thanks to the depth of renter demand concentrated around major rail interchanges.
The main demand driver keeping vacancy low in these Tokyo areas is the combination of massive employment clusters, university populations, and exceptional transit connectivity that makes them magnets for renters.
The trade-off investors typically face when targeting these low-vacancy areas is that purchase prices are higher, which often means accepting a lower gross yield in exchange for more reliable occupancy.
Which areas have the most renter demand in Tokyo right now?
The top three neighborhoods currently experiencing the strongest renter demand in Tokyo are Shinjuku for its job access, Kita-Senju for its value-commuter appeal, and Ebisu for its lifestyle attractiveness.
The renter profile driving most demand in these areas is young professionals aged 25 to 40 who prioritize short commutes, walkable amenities, and proximity to entertainment or dining options.
Rental listings in these high-demand Tokyo neighborhoods typically get filled within two to four weeks, and well-priced units near major stations often receive multiple applications within days.
If you want to optimize your cashflow, you can read our complete guide on how to buy and rent out in Tokyo.
Which upcoming projects could boost rents and rental yields in Tokyo as of 2026?
As of early 2026, the top three upcoming projects expected to boost rents in Tokyo are TOFROM YAESU near Tokyo Station with completion in 2026, TAKANAWA GATEWAY CITY near Shinagawa which opened in March 2025, and the ongoing Greater Shibuya redevelopment program.
The neighborhoods most likely to benefit from these projects include Yaesu and Nihombashi in Chuo ward near the TOFROM development, Takanawa and Shinagawa in Minato ward, and the Shibuya station area across multiple connected districts.
Investors might realistically expect rent increases of 3% to 8% in the immediate vicinity of these projects over the next one to three years, though the impact fades with distance from the development sites.
You'll find our latest property market analysis about Tokyo here.
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What property type should I buy for renting in Tokyo as of 2026?
Between studios and larger units in Tokyo, which performs best in 2026?
As of early 2026, smaller units like studios and 1K apartments are the better-performing property type in Tokyo in terms of both rental yield and occupancy speed.
Studios in Tokyo typically deliver gross yields of 4.0% to 5.5% (around 280,000 to 385,000 yen, or 1,800 to 2,500 USD, or 1,700 to 2,350 EUR annually per million yen invested), while larger 2LDK units often yield only 3.0% to 4.0%.
The main factor explaining this gap is that Tokyo has a deep pool of single renters, students, and young professionals who need compact units near stations, creating steady demand and faster re-leasing.
Larger units can outperform in specific scenarios, such as family-oriented neighborhoods with good schools where tenants stay longer and turnover costs are lower, making stability more valuable than headline yield.
What property types are in most demand in Tokyo as of 2026?
As of early 2026, the most in-demand property type in Tokyo is the compact apartment, specifically studios and 1K units near major train stations.
The top three property types ranked by current tenant demand in Tokyo are small apartments for singles, practical 2LDK family apartments in commuter-friendly areas, and detached houses in neighborhoods with good schools.
The primary demographic trend driving this demand pattern is Tokyo's large and growing population of young professionals and single-person households who prioritize transit access over space.
Large luxury condos above 100 square meters are currently underperforming in rental demand and likely to remain so because the tenant pool for high-end family rentals in Tokyo is thin and price-sensitive.
What unit size has the best yield per m² in Tokyo as of 2026?
As of early 2026, the unit size range that delivers the best gross rental yield per square meter in Tokyo is between 20 and 35 square meters, which corresponds to studios and compact 1K apartments.
These optimal-sized units in Tokyo typically generate gross rental yields of around 4.5% to 5.5% per square meter, translating to roughly 315,000 to 385,000 yen (2,000 to 2,500 USD, or 1,900 to 2,350 EUR) annually per million yen invested.
The main reason smaller units outperform on yield per square meter is that rent does not drop proportionally as unit size shrinks, while larger apartments face luxury pricing that rents cannot support as well.
By the way, we also have a blog article detailing whether owning an Airbnb rental is profitable in Tokyo.
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.
What costs cut my net yield in Tokyo as of 2026?
What are typical property taxes and recurring local fees in Tokyo as of 2026?
As of early 2026, the estimated annual property tax for a typical rental apartment in Tokyo ranges from about 50,000 to 150,000 yen (325 to 975 USD, or 305 to 915 EUR), depending on the assessed value and location.
Landlords in Tokyo must also budget for the City Planning Tax, which is typically 0.3% of the assessed land and building value annually, adding another layer to recurring ownership costs.
Combined, these taxes and fees typically represent between 0.5% and 1.5% of gross annual rental income for most Tokyo investment properties, though higher-value properties in prime areas may see larger absolute amounts.
By the way, we cover all the hidden fees and taxes in our property pack covering the real estate market in Tokyo.
What insurance, maintenance, and annual repair costs should landlords budget in Tokyo right now?
Annual landlord insurance for a typical Tokyo rental property costs approximately 15,000 to 30,000 yen (100 to 195 USD, or 90 to 185 EUR), covering fire and basic liability risks.
A recommended annual maintenance and repair budget in Tokyo is around 5% to 10% of gross rental income, which accounts for unit refreshes, appliance replacements, and minor fixes between tenants.
The repair expense that most commonly catches Tokyo landlords off guard is the building-level repair reserve fund, which averages around 12,000 yen per month and can increase as buildings age.
The total combined annual cost landlords should realistically budget for insurance, maintenance, and repairs in Tokyo is approximately 80,000 to 200,000 yen (520 to 1,300 USD, or 490 to 1,220 EUR), depending on building age and unit condition.
Which utilities do landlords typically pay, and what do they cost in Tokyo right now?
In Tokyo, tenants typically pay their own electricity, gas, water, and internet, while landlords cover common-area utilities indirectly through monthly condo management fees.
The estimated landlord share of utilities in Tokyo, embedded within condo fees, runs approximately 3,000 to 8,000 yen per month (20 to 50 USD, or 18 to 50 EUR), covering hallway lighting, elevator operation, and shared water costs.
What does full-service property management cost, including leasing, in Tokyo as of 2026?
As of early 2026, full-service property management in Tokyo typically costs between 3% and 5% of monthly collected rent, or approximately 3,000 to 8,000 yen (20 to 50 USD, or 18 to 50 EUR) per month for an average unit.
The typical leasing or tenant-placement fee in Tokyo is structured around one month's rent equivalent, often ranging from 50,000 to 100,000 yen (325 to 650 USD, or 305 to 610 EUR) depending on the service level and bilingual requirements.
What's a realistic vacancy buffer in Tokyo as of 2026?
As of early 2026, landlords in Tokyo should set aside approximately 5% of annual rental income as a vacancy buffer for well-located properties, or up to 8% to 10% for older buildings or weaker micro-locations.
In Tokyo's tight rental market, landlords typically experience between one and three weeks of vacancy per year under normal conditions, though turnover between tenants can extend this in less desirable buildings.
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What sources have we used to write this blog article?
Whether it's in our blog articles or the market analyses included in our property pack about Tokyo, we always rely on the strongest methodology we can, and we don't throw out numbers at random.
We also aim to be fully transparent, so below we've listed the authoritative sources we used, and explained how we used them and the methods behind our estimates.
| Source | Why it's authoritative | How we used it |
|---|---|---|
| Statistics Bureau of Japan | This is Japan's official statistics office that publishes the national benchmark housing stock data. | We used it to anchor vacancy definitions and separate housing vacancy from rental market vacancy. We also verified that Tokyo's overall housing context aligns with our rental-focused analysis. |
| e-Stat Government Portal | This is the Japanese government's official portal for published statistical datasets. | We used it to verify where the latest Housing and Land Survey tables live. We confirmed that the 2023 survey remains the current official benchmark for housing data. |
| MLIT Land Information System | This is the national ministry responsible for land policy and transaction price infrastructure in Japan. | We used it as the official reference for how Japan shares transaction price information. We triangulated private price and rent datasets against this government framework. |
| Savills Japan Research | Savills is a global real estate advisor with transparent market research methodology. | We used it to quantify occupancy rates and ground rent levels per square meter in Tokyo's 23 wards. We translated their occupancy figures into a tight-market vacancy estimate for early 2026. |
| Global Property Guide | This is a long-running international dataset that publishes a clear methodology for yield calculations. | We used it as the cleanest public numerical yield dataset for Tokyo by unit size and sub-area. We adjusted their figures to reflect January 2026 conditions using rent growth and occupancy signals. |
| Reuters (Tokyo Kantei context) | Reuters is a top-tier newswire that clearly attributes key numbers to named primary sources. | We used it to anchor the high-price context for Tokyo's 23 wards via Tokyo Kantei's cited figure. We explained why Tokyo yields are structurally lower than many global cities. |
| Reuters (Land price survey) | Reuters is highly reliable for summarizing official releases with dates and magnitudes. | We used it to confirm that Japan's land prices have been rising again, including residential. We used it as a macro check on the yield versus appreciation tradeoff in Tokyo. |
| East Japan REINS | REINS is the core industry infrastructure for real estate transaction information in Japan. | We used it to quantify typical owner-paid monthly fees like management and repair reserves. We translated these into a net-yield haircut using the ratio to transaction price per square meter. |
| MLIT Repair Reserve Guideline | This is published by Japan's land and transport ministry and is used as a planning guideline. | We used it to validate typical repair reserve levels per square meter per month. We sanity-checked the REINS averages against this official guidance. |
| Kanazawa City Tax Guide | This is a municipal government publication explaining local tax rules in plain terms. | We used it to support the existence and typical rate of the City Planning Tax alongside fixed asset tax. We referenced it as a conservative, official source for recurring tax line items. |
| JETRO Taxes in Japan | JETRO is a government-related organization providing official investor guidance. | We used it to confirm the set of principal taxes investors encounter in Japan. We kept the net yield cost list aligned with recognized tax categories. |
| JR East Press Release | JR East is the project owner and operator, and this is a primary document. | We used it to identify the TAKANAWA GATEWAY CITY transformation with a firm opening timeline. We explained where renter demand can strengthen around Shinagawa and Takanawa. |
| Tokyo Tatemono (TOFROM YAESU) | Tokyo Tatemono is a major Japanese developer, and this is a primary project document. | We used it to cite a specific 2026 CBD mega-project that can lift office-based housing demand nearby. We named a concrete 2026 catalyst around Tokyo Station, Yaesu, and Nihombashi. |
| Tokyu Corporation | Tokyu is the principal private-sector shaper of Shibuya-area development and publishes primary materials. | We used it to support Shibuya as a long-running redevelopment zone that sustains premium rents. We grounded micro-area commentary with a real plan document. |
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