Japan Real Estate Market Quarterly Review-Fourth Quarter 2023

Financial Research Department Makoto Sakuma 

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Macro Economy
  • Japan’s real GDP is expected to increase by 0.2% q-o-q (annualized 0.9% decrease) in Q4 2023, the first positive growth in two quarters.
  • Japan’s real GDP is expected to expand by 1.5% in FY2023, 1.3% in FY2024, and 1.1% in FY2025.

Real Estate Market
  • Tokyo office market shows signs of bottoming out, but too early to tell if rents will rebound
  • In Tokyo 23-ku, multifamily rents continue to increase in all types
  • Retail sales continue to increase driven by inbound consumption and high-end spending
  • Population inflow trends to Tokyo recovered to the pace slightly below 2019 levels
  • The number of guests exceeded the level pre-COVID, driven by strong inbound demand
  • Vacancy rates are rising in both Greater Tokyo and Greater Osaka

Capital Market
  • J-REIT Index decreased by 2.8% q-o-q in Q4 2023, trading at a price to NAV ratio of 0.89x, dividend yield at 4.3%, and dividend and JGB spread at 3.7% in December 2023
  • In 2023, J-REIT's acquisitions increased by 25% y-o-y, exceeding the ¥1 trillion mark for the first time in two years

This report includes data from various sources and NLI Research Institute does not guarantee the accuracy and reliability. In addition, this report is intended only for providing information, and the opinions and forecasts are not intended to make or break any contracts.

Financial Research Department  

Makoto Sakuma

Research field
Real Estate Research and Strategy, Proptech


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