The Democratic Party for the People (DPFP), the leader of the July election race in Japan, is expected to introduce a bill soon that would restrict real estate purchases by foreign investors. This is reported by UNN with reference to CNBC and Reuters.
Details
In July of this year, Tokyo's Chiyoda district appealed to the Real Estate Association, an industry group, to strengthen measures to prevent the resale of newly built real estate properties. The goal is to curb speculative transactions and prevent excessive price increases.
According to a report by the Real Estate Economic Institute, over the past year:
The average price of new apartments in 23 municipalities in the center of the island Asian country's capital reached 111.81 million yen (about 760,000 US dollars).
But an even better market indicator is the median price. In this regard, the cost was 89.4 million yen, which is 9% more than a year earlier.
Currently, there is growing public dissatisfaction in Japan with the current trend in the real estate market.
Public opinion is influenced by the income level of Japanese residents and the current economic situation in the country.
Income levels remain low compared to several developed countries. For example, in 2024, Japan ranked 25th out of 34 members of the Organization for Economic Cooperation and Development, ranked by purchasing power parity.
In terms of average annual wages adjusted for purchasing power parity - 49,446 US dollars, Japan ranks even below the average level.
But at the same time, real estate prices in the best areas of Tokyo have risen sharply. Various factors contributed to this. Among them:
- rising construction costs;
- labor costs;
- a rather weak yen (Japan's official currency) and, accordingly, relatively low valuations. That is, a situation that attracts foreign investors.
The urban real estate boom has attracted political attention, particularly during the recent upper house elections.
According to local media reports, the Democratic Party for the People (DPFP), which won a significant victory in the July elections, is expected to introduce a new bill.
The goal is to restrict real estate purchases by foreign investors. The bill is expected at the autumn extraordinary session of the Japanese parliament.
Real estate market: where buying a home will be cheapest07.07.25, 11:54 • [views_4561]
Let's return to the Chiyoda district in central Tokyo
Public dissatisfaction with the trend in the Japanese real estate market is growing, as evidenced by numerous appeals. People expect the introduction of measures at the national and local levels, particularly regarding the issue of foreign ownership of real estate.
One of the central proposals in the dispute:
Certain apartments involved in redevelopment projects and other projects, according to a special provision, must be "unavailable" for resale for five years from the date of transfer.
In addition, there are already provisions that prohibit multiple purchases of the same property under the same name.
People who want to live in the area may no longer be able to do so: if speculative buying and selling increases; if prices rise even further
At the same time, there is data that the real estate industry in Tokyo is thriving:
Five major companies, including Mitsui Fudosan and Mitsubishi Estate, reported record profits for the previous fiscal year.
So, will administrative guidelines effectively curb prices?
Discussions between the authorities and residents of central Tokyo continue. But at the same time, there are valid concerns about the risk of violating property rights.
Now, should we expect restrictions in the style of "Japan First"?
There is an opinion that officials seeking populist changes are regaining popularity in Japan.
For example, Sanseito, a right-wing populist party campaigning on an anti-immigration "Japan First" platform. The party is also preparing its own proposal to restrict land acquisition by foreign nationals, but Sanseito has not yet set a deadline for submitting this proposal.
Meanwhile, the ruling coalition does not have a majority in both houses of the Japanese parliament. Therefore, the positions of opposition parties are becoming increasingly important for shaping the results of legislative decisions.
In fact, it is quite difficult to separate foreign ownership from the broader debate about Japan's foreign population, believes Tobias Harris, founder of the political risk consulting firm Japan Foresight.
Regarding Sanseito's proposals, he says the following:
In its rhetoric, the party emphasizes... economic security, hinting at the danger posed by some foreigners buying real estate
Currently, data on foreign real estate purchases in Japan are not "on the surface."
The volume of foreign purchases is difficult to determine because Japan does not publish official statistics on the nationality of buyers.
But there is a semi-annual study by Mitsubishi UFJ Trust & Banking Corp, published in March 2025. In 3 districts of Tokyo:
- Chiyoda.
- Shibuya.
- Minato
According to the study, in each of the above-mentioned districts, 20% to 40% of new apartments are usually sold to foreign buyers.
However, domestic investors and residents also buy real estate. That is, in fact, foreigners are only one of the factors in price growth.
But Sanseito has intensified its rhetoric regarding foreigners and foreign capital after winning three seats in the lower house last year, CNBC writes.
Recall
Summer sales of residential real estate in the US showed the slowest growth in 10 years.