The Tokyo, Osaka and Nagoya metropolitan areas saw commercial land prices rise for the first time in five years in the year to July 1, a government land price survey says.
Commercial land rose 0.6 percent on average for the three major metropolitan areas. Residential land meanwhile posted a minor dip of 0.1 percent, the data showed.
Prices for commercial land are climbing in major cities under Prime Minister Shinzo Abe’s deflation-busting stimulus plan. The plan, dubbed “Abenomics,” has triggered investment in real estate and housing after the government weakened the yen, sending stocks soaring, analysts said.
Land prices rose at half of the commercial locations covered by the annual land price survey and at 30 percent of the residential locations in the three areas.
On a nationwide basis, however, average prices in both sectors continued to fall, albeit at a slower the pace. Commercial land fell 2.1 percent, logging the sixth drop straight, while residential land fell 1.8 percent, down 22 years in a row.
Nagoya posted the steepest rise of the three, at 0.7 percent, and recorded the same increase in residential land.
In districts other than Tokyo, Osaka and Nagoya, commercial land sank 3.1 percent and residential land 2.5 percent.
By prefecture, Osaka scored the largest rise in commercial land at 1.1 percent, followed by Kanagawa, Aichi, Tokyo and Miyagi. Aichi logged the largest uptick in residential land at 0.8 percent, with Miyagi, Tokyo and Kanagawa taking the next three spots.
“Low interest rates and tax cuts for housing loan borrowers have worked to expand housing demand before the planned consumption tax hike” next April, said a land ministry official.
Land prices at some of the locations in Tohoku damaged by the 2011 earthquake and tsunami rose as residents moved to higher ground and demand increased for reconstruction.
Among residential locations covered by the survey, a site in Otsuchi, Iwate Prefecture, registered a 30.5 percent spike, the largest seen. In fact, nine locations in Tohoku were among the top 10 residential land price gainers.
A location in Tokyo’s Ginza district claimed the highest land price nationwide for the eighth year straight, rising to ¥20.4 million per sq. meter from ¥19.7 million a year earlier, the survey found.