In Tokyo, “location, location, location” means the three As
Neighborhoods of Azabu, Aoyama and Akasaka see big jumps in land prices as younger buyers favor luxe high rises
Luxury high-rises in Tokyo usually don’t demand the same sky-high prices than their counterparts in London, Hong Kong and New York. That’s because Japanese buyers, drivers of the local market, eschew luxuries like flashy interiors, a pool in the building or even multiple bathrooms in a unit.
But the importance of location is universal in real estate around the globe. And in Tokyo, the best location has long been and remains the areas close to the emperor’s Imperial Palace.
Homes in the capital’s most exclusive neighborhoods – Azabu, Aoyama and Akaska, known as the three As – command the highest prices in the city, according to the Wall Street Journal.
The city’s Minato ward, where the three neighborhoods are located, saw the average price of land jump 11.5 percent last year to the equivalent of $1,420 per square foot, according to the country’s land ministry. That was the biggest increase in all of Tokyo’s 23 municipalities.
Akaska, where prices are the highest, saw land valued at $3,100 per square foot, up more than 50 percent from five years earlier.
Penthouses in the three As and the neighboring district of Roppongi can go for as much as $27 million, and among the clients looking to snap up such homes are the presidents of Japanese companies, lawyers, doctors and executives who work for foreign securities companies.
Properties worth $10 million or more are usually sold quietly to a select group of buyers known among real estate agents because those owners prefer to remain anonymous.
“In the Japanese culture, even if you are wealthy, having too much—it is a bit of a negative status symbol,” said Adam German, head of marketing and vice president at the real estate agency Housing Japan.
But things are changing, and younger generations are looking more like foreign buyers in terms of taste. Local experts say that the declining Yuan and the 2020 Summer Olympics could also attract more foreign buyers. [WSJ] – Rich Bockmann
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