To preface our post on COVID-19 and Japanese Real Estate, I would like to let all our non-Japanese readers who are living in Japan know we are here for you regarding any assistance. Such as, updates on what the news is broadcasting, what the politicians are discussing, and need to know updates.
I know it can be terrifying to see what is happening in your home country and to see first hand what is happening or not happening here in Japan. For me, being from the United States, I see the news with the sudden outbreak, mandatory quarantining, and social distancing plastered all over my Facebook Feed.
Contact us for any questions concerns you may have.
We will answer any questions or concerns you may have to the best of our knowledge. Please know we are here for anyone looking to speak with someone who speaks a common language.
DIRECT CONTACT: 090-6558-5277 (Mike Bennett)
As we are all aware of the what COVID-19 is and how it is affecting our everyday lives worldwide.
A quick timeline on the events of COVID-19 here in Japan
- January 16: first confirmed case in Japan
- February 4: Diamond Princess Cruise Ship quarantined in the Port of Yokohama
- February 13: first death from COVID-19
- February 27: Prime Minister Shinzo Abe requested the closure all elementary, junior, and high schools.
- February 28: Hokkaido’s Governor declared a State of Emergency lasting February 28th to March 19th.
- March 5: quarantine restrictions for travelers from South Korea and China.
- March 16: additional restrictions for foreign national entering Japan.
- March 24: guidelines to reduce risk of virus infections are set as schools are set to be reopen in April (New School Year)
What Changes are happening in the Real Estate Industry?
Please note the trends and activities we will discuss in this section will focus on the Kansai Region, mainly Osaka. Other areas in Japan might see different trends and situations compared to Osaka.
Inquires as a whole regarding real estate investing, personal use (vacation homes) from non-Japanese buyers living abroad have gone down. Here at RE/MAX APEX had 5 groups cancel there trip to Osaka to potentially buy either for investment or personal use. There are a few parties still working with to broker their transaction without making the trip to Japan. We want to thank those parties for working with us and trusting us to do the best we can under the circumstances.
Domestically, both non-Japanese and Japanese buyers for residential real estate has slowed down as well. Naturally, the number of viewing has decreased as well. It is natural for the consumer to be hesitant with the current financial climate to lock in on a 35 year loan.
As for commercial real estate, buyers are taking caution but not as cautious as those looking for their primary residence. The demand is not drastically decreasing. COVID-19 has effected commerce in Japan causing shops, restaurants, small businesses to close. Those who are financially strong might look to this as an opportunity to buy from those looking for capital or real estate lacing in cash flow. A slight increase in commercial real estate, mainly office spaces has been observed as well.
There has been concerns on delays in constructing new developments caused by the shortage and delays of building materials from China. This is also affecting renovation projects as well. The shortage of toilets is interesting enough with the shortage of toilet paper in super markets and drug stores.
Since the tourism has taken a huge hit from COVID-19, tourist accommodations and operators of these accommodations has been negatively impacted. The vacancy rates have drastically risen causing a cashflow shortage (as mentioned above). Apartment buildings which were built for the sole purpose of short term accommodations (Airbnb type) properties are hitting the market and we believe will increase in inventory within the next few months. These apartment buildings were built with numbers correlated to the short term accommodations rental market and not the general rental market. With this, unit vacancies have risen as well.
International Olympic Committee member Richard “Dick” Pound announced the 2020 Tokyo Olympics will be postponed, most likely to next year 2021. Will we stay patient and steady in a sellers market or will it turn into a buyers market? Will land prices continue to increase or will we see it plateau and possible decrease? Only time will tell, and we are curious to see what will take place.
What is most important now is your health and the health of your loved ones. We wanted to keep our readers informed on what is happening in Japan, mainly in Osaka during this global virus outbreak. If you have already bought or thinking of buying real estate in Japan, we hope this piece of information is somewhat of use for you. We also want to thank the readers who aren’t particularly looking to buy or invest in Osaka, but are just curious as to what the current real estate climate is in Osaka.
As we mentioned above, please feel free to contact us for any questions or concerns you may have during this time. Real estate is secondary, the health of us humans is more important.
DIRECT CONTACT: 090-6558-5277 (Mike Bennett)