Tokyo's Property Boom Arrived Late

For years, Tokyo was the exception.

While cities like London, Sydney, Vancouver, Stockholm, and New York experienced dramatic increases in housing prices, Tokyo remained surprisingly stable. Many investors looked at Japan's shrinking population, decades of low inflation, and near-zero interest rates and concluded that Japanese real estate simply wasn't a great investment.

But that narrative is beginning to change, not only among lifestyle buyers.

According to the latest data from Tokyo Kantei, the average price of a 70-square-meter resale condominium in Tokyo's 23 wards reached ¥128.49 million in May 2026. That's an increase of 27.4% compared to the same month last year and marks the 25th consecutive month of price growth.

So what's driving the trend?

First, Tokyo continues to attract people from across Japan and around the world. While Japan's overall population is declining, Tokyo's population continues to grow as people move to the capital in search of jobs, education, and opportunity.

Second, the weak yen has made Japanese assets increasingly attractive to foreign buyers. Compared to many global cities, Tokyo still offers relatively good value, particularly considering its safety, infrastructure, and quality of life.

Third, construction costs have risen significantly. Labor shortages, material costs, and inflation have pushed the cost of building new homes higher, which in turn supports prices in the resale market.

And finally, inflation has returned to Japan after decades of stagnation. For the first time in a generation, many buyers are beginning to consider real estate not only as a place to live, but also as a store of value.

Does this mean Tokyo is expensive?

That depends on your perspective.

Compared to many major global cities, Tokyo remains relatively affordable. However, compared to where it stood five or ten years ago, the market has changed dramatically.

The rest of the world experienced its housing boom years ago.

Tokyo may simply be arriving a decade later.

The question now is whether this is the beginning of a longer-term shift—or merely the next chapter in Japan's uniquely cyclical property market.