E - PAPER

CURRENT MONTHS

LAST MONTHS

VIEW ALL
  • About
  • TEAM REALTY+
  • CONTACT US
  • SUBSCRIBE
  • HOME
  • NEWS ROOM
  • COVER STORY
  • INTERVIEWS
  • DRAWING BOARD
  • PROJECT WATCH
  • SPOTLIGHT
  • BUILDING BLOCKS
  • BRAND SYNC
  • VIDEOS
  • HAPPENINGS
  • E-MAGAZINE
  • EVENTS
    • EVENT CALENDAR
    • UPCOMING EVENT
    • PAST EVENT
search
  1. Home
  2. INTERNATIONAL

Japan Real Estate Witnessing Slowing of Inflow of Global Funds

Japan Real Estate Witnessing Slowing of Inflow of Global Funds

BY Realty Plus
Published - Saturday, 25 Mar, 2023
Japan Real Estate Witnessing Slowing of  Inflow of Global Funds

Money from international investors helped fuel a sharp rise in Japanese property values, but the inflow of funds has slowed recently amid stress in the financial markets. Japanese land prices jumped at the fastest rate in 15 years, Japan's Ministry of Land, Infrastructure and Transport said. Commercial real estate in Tokyo, Nagoya and Osaka showed some of the biggest gains on the year.

International investors -- aided by a historically weak yen -- spent roughly 1.35 trillion yen ($10.2 billion) in 2022 on Japanese real estate, according to the real estate services group CBRE, up 12% from a year earlier. But in the fourth quarter, investments plunged 42% from a year earlier. One Japan manager at a U.S. investment fund noted a dramatic reversal from previous conditions where buyers would immediately snap up Tokyo properties.

The percentage of international investors describing their appetite to invest in Japanese real estate as strong or moderately strong declined by 33 points over a year to 48% in a January survey conducted by Mitsubishi UFJ Trust and Banking, marking the first reading below 50% since 2013. 

The denominator effect comes into play in a portfolio when a specific asset class becomes overweight, prompting a rebalance by holding off on additional investments or selling off portions of the holdings in that asset class. Global equity markets suffered a downturn last year, and without a rebound in stock values, investors will shy away from real estate investing.

Market players are also on edge over the risk of a global economic slump. The collapse of Silicon Valley Bank has demonstrated that the side effects from rate hikes have already started to impact the financial ecosystem. There is growing concern that the economy could weaken more than expected if banks tighten financing, which would erode demand for real estate.

In a survey conducted by NLI Research Institute, 82% of respondents in the real estate industry expect Tokyo's property values to peak by 2023. A retreat by foreign investors would undermine the prospect of land values rising further.

Japanese real estate remains a relatively attractive investment. The margin between the investment return from lease incomes and long-term interest rates exceeded 2 points for Tokyo offices at the end of last year.  For Sydney, that rate spread stood at negative 0.3 point.

However, this is an artifact of the Bank of Japan adopting policies that kept down long-term yields. Kazuo Ueda, who will step in as the new BOJ governor next month, has touched on the side effects of yield curve control. International investors face the need to account for a potential policy shift by the BOJ.



  • TAGS :
  • international
  • investors
  • Japanese
  • property
  • values
  • funds
  • financial markets

RELATED STORY VIEW MORE

L&T to Build Renewable Energy Infra at NEOM’s World’s Largest Green Hydrogen Plant
New Zealand House Prices Expected to Descend Further This Year
Ben Affleck and Jennifer Lopez Buy $61 Million L.A. Mega Mansion

TOP STORY VIEW MORE

White Domus Luxury Furniture Collection for Father's Day

White Domus Luxury Furniture Collection for Father's Day

02 June, 2023

Dash Square Offers Array of Exclusive Furniture on Father’s Day

02 June, 2023

L&T to Build Renewable Energy Infra at NEOM’s World’s Largest Green Hydrogen Plant

02 June, 2023

NEWS LETTER

Subscribe for our news letter


E - PAPER


  • CURRENT MONTHS

  • LAST MONTHS

Subscribe To Realty+ online



REALTY+ SPECIAL ISSUES


  • THE TECH TITANS 2022

  • COFFEE TABLE BOOK 2022

  • Anniversary Issue 2022

  • Anniversary Issue 2020

VIDEO GALLERY VIEW MORE

Realty+ Indian Digital Excellence Awards Virtual Conclave 2023
Get connected with us on social networks!
ABOUT REALTY+

Started in 2004, Realty+, an exchange4media group publication is one of the most respected real estate magazines in India with offices in Delhi, Mumbai and Bengaluru.

Useful links

HOME

NEWS ROOM

COVER STORY

INTERVIEWS

DRAWING BOARD

PROJECT WATCH

SPOTLIGHT

BUILDING BLOCKS

BRAND SYNC

VIDEOS

HAPPENINGS

E-MAGAZINE

EVENTS

OTHER LINKS

SITE MAP

GDPR-COMPLIANCE

COOKIE-POLICY

PRIVACY-POLICY

TERMS AND CONDITIONS

Contact

ADSERT WEB SOLUTIONS PVT. LTD. 3'rd Floor, D-40, Sector-2, Noida (Uttar Pradesh), Pincode - 201301

tripti@exchange4media.com
realtyplus@exchange4media.com

+91 98200 10226


Copyright © Realty Plus Magazine.