The average price of new condominiums released last year in central Tokyo topped ¥100 million ($677,000) for the first time, driven by luxury properties and soaring construction material prices, real estate research firm data showed.

The price shot up 39.4% from the previous year to ¥114.83 million per unit in the capital's 23 wards, the Real Estate Economic Institute said Thursday.

The average price of new condos in the capital and the three surrounding prefectures of Chiba, Kanagawa and Saitama also climbed sharply, rising 28.8% to ¥81.01 million for the fifth straight year of increase.

"There was an explosive rise of dwelling units exceeding ¥100 million in 2023," an official with the research firm said.

The trend of increasing prices comes on the back of low-interest housing loans after the Bank of Japan launched large-scale monetary easing in 2013, while the supply of condominiums has fallen as suitable land to build condominiums decreases.

One notable trend last year was purchases by buyers from double-income households with high earnings, according to the institute.

By area, the average price rose 3.7% to ¥54.27 million in Tokyo outside the 23 wards, 4% to ¥47.86 million in Chiba Prefecture, and 12.2% to ¥60.69 million in Kanagawa Prefecture.

In Saitama Prefecture, however, prices sank 7.5% to ¥48.70 million.

The number of new condominiums going on sale last year in the capital and the surrounding three prefectures dropped 9.1% from the year before to 26,886 units, the lowest level in about three decades, the institute said.

About 31,000 units are expected to be released this year in the region, mainly in the suburbs, it said.