Tokyo’s land prices are soaring once again, and across wider areas, raising growing concerns that the capital may become affordable only for the wealthy.
Property values are climbing not just in the city’s traditional business and luxury districts, but also in surrounding areas, according to standard land prices released by the Tokyo metropolitan government on Sept. 16.
Land prices as of July 1 across residential areas in Tokyo rose by 5.6 percent over the past year, outpacing last year’s 4.6 percent increase.
The price boom has long centered around the city’s central five wards: Chiyoda, Minato, Chuo, Shibuya and Shinjuku. However, this year’s notable trend was the sharp price growth in adjacent districts.
Meguro and Taito wards recorded the highest residential price increases, at 13.7 percent and 13.4 percent, respectively.
Meguro’s figure tied with Minato Ward for the highest among Tokyo’s 23 wards.
Taito, home to the popular tourist neighborhood of Asakusa, jumped from 16th to third place in growth rate rankings.
Meguro and Taito share key advantages: proximity to central Tokyo, convenient access via multiple train lines and quiet residential environments.
However, construction costs are rising due to material inflation and severe labor shortages, leading to a decline in the supply of newly built apartments in the capital.
In the first half of 2025, only 2,964 new apartments were supplied across the 23 wards–a 10.7 percent decrease compared to the same period last year, according to the Real Estate Economic Institute Co.
As a result, average prices for new apartments in July reached a staggering 135.32 million yen ($923,000)–a 24.4 percent year-on-year increase.
With new units becoming scarcer and more expensive, buyers are now turning to the secondary market.
According to Tokyo Kantei Co., a real estate data firm, the average list price for pre-owned apartments in the 23 wards in July hit 104.77 million yen, up 1.4 percent from the previous month, and exceeding 100 million yen for the third consecutive month.
Toshiaki Nakayama, from a think tank affiliated with real estate agent Lifull Co., said many of the 100-million-yen second-hand apartments are located in the city’s five central wards, driving up prices in surrounding areas.
“With the labor shortage in the construction sector still severe, there’s no reason to believe that residential prices will go down,” Nakayama said. “Unless the government intervenes, Tokyo could face a future where only the affluent can afford to live in more and more neighborhoods.”
TOURISM FUELS ASAKUSA RISE
Commercial land prices also saw a significant boost, particularly in tourist-heavy areas.
The highest commercial land price increase was recorded at a block in Asakusa, near the iconic Kaminarimon gate, with a 27.4 percent rise.
Just a five-minute walk west, another block in the neighborhood followed closely with a 25.2 percent increase, ranking second.
According to the Tokyo metropolitan government, a surge in tourism is driving up demand for restaurants and hotels.
Shigemi Fuji, chairman of the Asakusa Tourism Federation, noted that the area has transformed dramatically since around 2020, as preparations for the Tokyo Olympics ramped up.
The opening of Tokyo Skytree in 2012 also boosted international tourism, attracting not just visitors from China but also from the Middle East, Europe and North America.
Although new businesses continue to open while others shut down, Fuji sees this constant turnover as a sign of vitality.
“Thanks to its convenient subway access, Asakusa is increasingly popular among young Japanese as well, for short getaways,” Fuji said.
AloJapan.com