Commercial Land Prices rise for the first time in outlying cities of Japan after 26 years

In Japanese cities excepting the three major urban cities like Osaka, Tokyo and Nagoya, prices of commercial land has finally been increased after 26 years last year on urban redevelopment and hotel demand, according to a survey conducted by government on Tuesday. In these cities, the average price for commercial land had seen the rise of 0.5% last year. It was the first growth of prices since 1991, the Ministry
of Infrastructure, Land, Tourism and Transport suggests.

It slightly fills the gap with three major cities, where prices have been increased by 3.9%, i.e. up from 3.3% in the year 2016. Across the country, the price of commercial land rose to 1.9% last year on average,
while prices of residential land rose to 0.3%. But in outlying cities, the prices of residential land dipped to 0.1%, i.e. smaller than 0.4% in the previous year. Fukuoka, Sendai, Hiroshima and Sapporo are the four leading regional hubs which led the rise of prices, with average price rising 7.9% after 2016’s 6.9% rise. As Japan has planned to host 40 million overseas tourists in the year 2020, when Tokyo will be hosting the Summer Olympic Games, developers are building hotels across the nation aggressively. In Japan, the population of foreign tourists grew 19.3%, which is a record high with 28.7 million in previous year.

In smaller cities like Niigata, Yamagata, and Utsunomiya, the commercial land prices slide down and stopped for the first time in over 20 decades as the projects of redevelopment has been progressed.
In commercial land price, the biggest hike was in the leading ski resort at Niseko which is located on the north of Hokkaido, which rose 35.6% due to the demand for houses and retail space to serve employees in the resort, according to the ministry. Across the nation, over 26,000 cities have been surveyed by the ministry.