The pandemic impact on real estate prices in Japan
The outbreak of the covid-19 virus has, unfortunately, had an effect on all areas of life. The way we socialize, work, study, commute, and so on have all changed drastically. Almost all major industries experienced losses. Lockdowns and restrictions were absolutely necessary but unfortunately, they left their mark. Tourism, retail, and entertainment have been hit the hardest. The moving industry isn’t so far behind, as long-distance moving wasn’t possible for the better part of the last year. With entire countries closing borders even cargo export suffered losses. However, the pandemic impact on real estate prices in Japan has been interesting. We’ll go over all the information you need to know before purchasing a property in Japan during these uncertain times.
How the pandemic impacted our daily lives
To understand the effect of the pandemic on property prices in Japan, we should look into the possible reasons behind it. As stated before, our daily lives have changed drastically. Because of the pandemic, many businesses have shut down. This in turn led to thousands of people losing their income. White-collar workers easily transitioned to working online from home. For the most part, they’ve been able to keep their jobs. Whereas people in the retail, restaurant, and service industry did not have that privilege. You may wonder why this is important for the real estate market. Well, it means that middle and low-income workers are putting off purchasing property. Consequently, prices of smaller homes are declining because of weak demand. In case you’re interested in purchasing a small, family home this might be the right time.
Record-breaking land price falls
For the first time in 6 years, land prices in Japan decreased. This drop is directly caused by the covid-19 pandemic. This is the sharpest decline the country’s market has seen in years. What’s even more fascinating is that both commercial and residential land saw a decrease. Once highly sought out properties were being sold for low prices. Thus, buying a home in Japan during the coronavirus is a good financial decision.
The impact of the coronavirus pandemic on city properties
As we mentioned before, smaller homes on the city outskirts saw a decrease in prices. The market is oversaturated, and many people are downsizing. In contrast, the housing market in major cities hasn’t experienced much change. Prices dropped, yes but they’re still high. Sales have increased and scoring a home that fits your needs is harder than ever. People are spending a lot of time indoors. Consequently, they’re buying bigger houses that can accommodate an office or two.
How to turn the pandemic impact on real estate prices in Japan in your favor
While we live in uncertain economic times, there are ways of using them to your advantage. Because of the falling prices of family homes, this could be a good time to move to Japan. If you’re not looking for luxury, you won’t have trouble finding a property that fits your needs and budget. As a consequence, you’ll have more money to carry out your move. From packing supplies to international freight forwarding, expenses quickly add up. Buying a home now would take some stress out of the equation. Additionally, because the market is oversaturated, finding the right home will be less stressful too. The market favors buyers, so don’t waste time. Take advantage of this anomaly, as it will most likely change as covid measures die down.
Simple tips for making your Japan relocation as easy as possible
Purchasing a home is only one part of relocating. Many other steps need to be taken care of in advance. Our team of experts here at Kokusai Express has compiled a list of things you should do:
- before even purchasing property, get all of your documents in check
- make sure to have a valid, non-expired visa
- research reliable moving companies
- be aware of scams
- declutter your belongings
- rent a storage unit for things too large to transport
- buy top-quality packing materials
- decide what’s essential, and what you can leave behind
- insure your belongings
How long will the impact on real estate prices stay?
It’s easy to talk about what societal and economic factors caused the decline in real estate prices. On the contrary, it’s hard to know how long this will last. Some experts are predicting it won’t stay for long. It’s unrealistic to expect the prices to stay low or keep this trend. Consequently, they advise buying sooner rather than later. You might miss out on a deal of your life if you wait around. It is unlikely another drop will happen. On top of that, the economy is slowly starting to recover. As measures and lockdowns lessen, people can get back to their jobs. In turn, they have more buying power and are more likely to spend. Additionally, vaccines majorly sped up our journey back to normal. Predicting what will happen is impossible, but we advise not to hesitate.
Long-term ramifications of the pandemic on real estate prices
We’ve talked about the market, how long this shift will last, and more. However, we haven’t touched on what consequences this situation will bring. As we mentioned, high-income workers are buying up properties in the cities. Meanwhile, the middle class is moving to the outskirts in search of cheaper prices. This is widening the divide between the two classes. Alongside that, the percentage of privately owned homes is dropping steadily. The pandemic didn’t cause these issues, but it exacerbated existing problems.
To conclude, the pandemic impact on real estate prices in Japan cannot be ignored. The drop in prices was a sudden and exciting change. Try to use it to your advantage while you still can. The current state of the world makes it hard to predict what will happen next.