Tokyo’s real estate market continues to captivate global investors and homebuyers, blending modern urban living with timeless cultural appeal. A recent survey by LIFULL, a prominent Japanese real estate information provider, reveals a staggering 16-fold increase over the past decade in the proportion of second-hand apartments priced above 100 million yen—known locally as “okushon” (billion-yen mansions)—within Tokyo’s 23 wards. This trend is most evident in prestigious districts like Minato and Chiyoda, where over half of used apartments now fall into this luxury category. As new condominium prices escalate, this heat is spilling over to the secondary market, creating opportunities and challenges for international audiences interested in Japan’s capital. In this comprehensive guide, we’ll explore the data, underlying drivers, cultural context, and practical advice for navigating Tokyo’s evolving property landscape.
Decoding the Surge in Okushon Apartments
LIFULL’s analysis, based on listings from its platform LIFULL HOME’S, paints a clear picture of Tokyo’s luxury second-hand market evolution. In 2015, just 1% of used apartments in the 23 wards exceeded 100 million yen (approximately $680,000 USD at current exchange rates of around 147 yen per dollar). By 2020, this rose to 3%, and in the first half of 2025, it hit 16%—meaning one in seven second-hand apartments now qualifies as an okushon, a dramatic 16-fold jump from a decade ago.
Breaking it down by ward, Minato tops the list with 55% of its used apartments in this price bracket, followed by Chiyoda at 51% and Chuo at 45%. These central areas, home to iconic spots like Tokyo Tower in Minato and the Imperial Palace in Chiyoda, reflect concentrated wealth and desirability. Conversely, peripheral wards like Suginami and Ota hover below 5%, with Adachi at 0%, highlighting a clear urban core-periphery divide in property values.
Toshiro Nakayama, Vice Director at LIFULL HOME’S Research Institute, attributes this to ongoing new-build price hikes, forecasting further growth in okushon shares as primary market pressures persist.
Drivers Behind Tokyo’s Real Estate Escalation
The okushon boom isn’t isolated; it’s intertwined with broader market dynamics. New condominium prices in Tokyo’s 23 wards averaged 111.81 million yen in 2024, marking the second year above the 100 million yen threshold. Central Tokyo saw even higher figures, with averages reaching 116.32 million yen in fiscal 2024, up 11.2% year-over-year. This surge is fueled by supply constraints: New condo releases in the greater Tokyo area plummeted 17% to 22,239 units in fiscal 2024, the lowest since 1973 and the third consecutive annual decline.
Foreign investment plays a pivotal role, with overseas buyers injecting a record 1.14 trillion yen into Japanese real estate in the first half of 2025 alone. Residential foreign investment rose 18% year-over-year to 740 billion yen in 2024, driven by a weakened yen and Japan’s stability. High-net-worth individuals from Asia, particularly Hong Kong, Singapore, and China, view Tokyo as a safe haven amid global uncertainties.
Low interest rates from the Bank of Japan, despite gradual normalization, continue to encourage borrowing. Urban redevelopment projects amplify this: Shibuya’s Sakuragaoka saw land prices spike 32.7% year-over-year, while Nakano rose 16.3% due to station-area developments. Nationwide, land prices increased 2.7% in 2025, the fastest pace in 34 years, with Tokyo leading the charge.
Cultural Nuances and Economic Implications for Global Audiences
For non-native readers, Tokyo’s property market embodies Japan’s blend of tradition and innovation. “Mansions” (as apartments are called) symbolize status, often featuring earthquake-resistant designs and proximity to cultural landmarks like temples or cherry blossom spots. There’s no restriction on foreign ownership, making entry straightforward, but understanding local customs—like removing shoes indoors or community harmony—is key to cultural sensitivity.
Economically, this boom contrasts with Japan’s wage landscape. Average annual wages stood at about 4.55 million yen (around $31,000 USD) in 2024, or $49,446 in purchasing power parity terms per OECD data. This disparity has fueled debates on affordability, with condo prices in the 23 wards jumping 64% from 2021 to 2025 on a median basis. Some politicians advocate curbing foreign buys to protect locals, though no laws have passed yet.
Tokyo’s low vacancy rates (around 7.3%) and stable rents enhance appeal. In Q2 2025, average rents in the 23 wards rose 8.4% year-over-year to 4,586 yen per square meter, supporting gross rental yields of about 4.47% nationwide.
Opportunities and Strategies for Investors and Buyers
This market offers robust potential. Second-hand apartment prices in greater Tokyo rose 8.27% in April 2025, continuing a 60-month upward streak. Existing condos in Tokyo saw 30.2% gains in 2024. For investors, yields make it attractive for income generation, especially in a low-interest environment.
Tips for international buyers:
- Target Emerging Areas: Look beyond Minato to wards like Nakano for value amid redevelopments.
- Leverage Experts: Engage bilingual agents to handle paperwork and negotiations.
- Opt for Second-Hand: Used properties often provide better entry points with similar yields.
- Monitor Trends: Watch yen fluctuations and policy shifts; experts predict 5-6% annual price growth in 2025, down from 8% in 2024.
Future Outlook: Sustained Growth Amid Maturation
Nakayama anticipates more okushon dominance as new prices climb. Overall, Japan’s real estate market is projected to reach 557 billion USD by 2033. Yet, a slight cooling is evident, with new condo prices dipping 7% in April 2025. For global audiences, Tokyo remains a resilient choice, offering safety, culture, and returns.
Whether investing or relocating, Tokyo’s luxury market beckons. Explore listings on platforms like LIFULL HOME’S or consult experts for tailored insights.
