Overseas property market
Benefiting from the booming tourism industry, as well as the low yen exchange rate and interest rates, Japanese property prices have hit record highs for eight consecutive months, and there has been a rush for housing. The situation is just like the British property market in 2021 when multiple people competed for the same property. At the same time, there are also Hong Kong people who took advantage of the situation during the COVID-19 epidemic, buying old hotels in tourist areas for HK$50 million and fully renovating them, and then started anew through the Japanese tourism industry to earn passive income.
(Written by: Wendy Global Real Estate)
Japanese real estate research company Tokyo KANTEI announced that the average expected sales price of second-hand houses in September was for every 70 square meters (approximately 753 square feet) averaged 160 million yen (approximately HK$8.34 million), up 1.7% month-on-month, hitting a record high for eight consecutive months. Currently, Chiyoda Ward, the most expensive among the six wards in central Tokyo, costs 150 million yen (approximately HKD 7.8 million) per 70 square meters, and Bunkyo Ward, the most expensive, costs 83.69 million yen (approximately HKD 4.35 million).
Overseas property market
Renovation return of 100 million yen is 5 to 8%
Mr. Chen, a Hong Kong citizen who moved to Japan in 2019, applied for a business management visa that year. In addition to purchasing his own property, during the worst period of the epidemic, he purchased a property in front of Tsutenkaku Station in Osaka, Japan, at a price of 7.2 Japanese yen to Hong Kong dollars, equivalent to approximately HK$50 million. The hotel also spent 100 million yen to completely renovate it. As Japan is in the midst of a lockdown, he pointed out that the rental return has dropped from the expected 12% to 1%. Fortunately, the current situation is “keeping the clouds open”. He pointed out that he had always been optimistic about Japan’s tourism industry and expected it to get better and better. At that time, he was “defending first.”
Currently, Mr. Chen’s hotel has more than 60 rooms, including Japanese-style rooms with tatami mats. The rental return is about 5 to 8 cents.
Japan has now fully cleared customs. According to data released by the Japan National Tourism Administration, the number of foreign tourists visiting Japan in September was 2.1843 million, which was 96.1% of the same period in 2019. It has basically returned to the level before the new crown epidemic. The Japan Tourism Agency further stated that judging from the fact that foreign tourists are still visiting in an endless stream, the impact of the discharge of nuclear treated water from the Fukushima Nuclear Power Plant into the sea will have “limited” impact on Japanese tourism.
Overseas property market
Airbnb has low barriers to entry and is relatively easy to get into.
Sakura Japan founder Zhang Mingzhu said that there have always been investors in hotel projects in the past, but most of the general public only invested in small-amount projects, such as Airbnb of hundreds of thousands of Hong Kong dollars, because it was easier to enter. However, large-amount investors such as hotels and commercial buildings , it takes time and effort to prepare in the early stage, such as due diligence review and the entire closing period, which takes about two or three months, and both parties need to negotiate and negotiate the method of closing the deal.
It is difficult to apply for a mortgage in shops, hotels and B&Bs
In addition, she also pointed out that it is difficult for hotels to apply for local mortgages in Japan. Most buyers buy in cash, mainly because there is no actual operating data to support their rental income, and it is difficult to convince banks to provide financing loans. The situation is just like foreign companies entering the Japanese market. It is like setting up a new start-up company, and there is no operational strength. In addition, commercial buildings, shops or hotels and B&Bs are all types of property mortgages that are more difficult to obtain. As for buyers who rely more on loans, it is recommended to start with residential properties.
The original article was published on AM730
2023-11-02 20:30:45
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