Tokyo¡¯s new condominium prices rose to a record in 2025, driven by ballooning construction costs, supply constraints and more expensive luxury apartments hitting the market.
The average price of a new condo for sale in the Japanese capital and surrounding areas rose 17% to ?91.8 million ($596,000), according to figures released Monday by the Real Estate Economic Institute. Prices had fallen slightly in 2024 after increasing for five years in a row.
Home values in Tokyo have been on an upward trend as a weak yen increases costs of imported raw materials and a labor shortage adds to construction expenses. The supply of new apartments in the Tokyo metropolitan area fell 4.5% to the lowest in more than 50 years, the report showed, adding to price pressures in a market that has been dominated by high-end projects.
¡°Developers are focusing on central locations where they can sell luxury condos and justify the pricing,¡± said Zoe Ward, chief executive officer of brokerage Japan Property Central. ¡°A lot of their inputs will be construction costs and land pricing.¡±
The Bank of Japan¡¯s campaign to raise interest rates has done little to cool home prices. The frothy market has spurred concerns about affordability and speculation by foreign buyers. Prime Minister Sanae Takaichi has asked government ministries to consider ways to better monitor such investments.
The average prices for new condos in central Tokyo grew about 22% to ?136 million for the year, according to the report, while the number of new apartments listed for more than ?100 million surged 55%. The most expensive for sale in 2025 was a ?2.5 billion unit at Brillia Tower Nogizaka.
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