Land prices continue decline but at slower pace

Kyodo

The steady decline in land prices marked its 21st consecutive year in the year to July 1, but at a slower rate for both residential and commercial land, the government said Wednesday.

Residential land prices fell by an average of 2.5 percent, which was less than the 3.2 percent drop the previous year, the land ministry said.

Commercial land prices fell for a fifth straight year, dropping by an average of 3.1 percent compared with 4.0 percent the previous year.

But price drops slowed in residential zones in 39 prefectures, compared with 23 the previous year, and in commercial zones in 42 prefectures, compared with 32 a year ago.

“Such factors as low interest rates and tax breaks for housing loan borrowers are supporting (residential) land prices,” a ministry official said.

Price falls in the three major metropolitan regions narrowed for the third consecutive year to an average of 0.9 percent in residential zones and 0.8 percent in commercial zones.

The Nagoya metropolitan region logged very small drops of 0.2 percent in residential zones and 0.5 percent in commercial zones.

Coastal residential land prices in the Tokyo area meanwhile returned the levels they were at two years ago before the March 2011 quake and tsunami.

The price for a commercial plot close to Tokyo Skytree shot up 9.8 percent, the second-largest gain among all locations surveyed.

In Pacific coast prefectures between Kanagawa and Kochi, land prices at some coastal locations fell faster than those at inland points on fears that tsunami that could be triggered if a major earthquake occurs in waters south of these prefectures.

The more remarkable changes included 11.8 percent price drop somewhere in the city of Kochi, and an 8.9 percent drop at a point in Hamamatsu, Shizuoka Prefecture.

In Iwate and Miyagi prefectures, which were heavily damaged by the March 2011 disasters, prices in upland residential areas soared as people moved away from lower zones washed away by tsunami. An upland location in Rikuzentakata, Iwate Prefecture, scored the highest residential price gain of 14.6 percent.