Statistics from the Real Estate Economic Research Institute show that new condominium prices in Tokyo’s 23 wards have reached a record high. Even so-called power couples with combined household incomes above ¥10 million are finding it increasingly difficult to make a first-time purchase of a new home, while longer-term mortgages and rising interest rates are affecting household finances.
According to data released by the Real Estate Economic Research Institute, the average price of newly built condominiums for sale in the Tokyo metropolitan area was ¥164.93 million in July, a sharp 63.7% increase year on year. The average in Tokyo’s 23 wards was ¥265.20 million, a new record high. Supply of large-scale properties in central areas such as Minato Ward is seen as a key factor pushing up prices, with high-priced properties in central Tokyo accounting for the core of the market.
These price levels suggest that even households regarded as power couples, with combined incomes above ¥10 million, are finding it difficult to consider new properties as an option, while owner-occupiers are moving toward used properties and suburban areas. The polarization is becoming more pronounced as the price gap widens between supply centered on large-scale properties in central Tokyo and more affordable areas in the suburbs.
The spread of high-priced properties is also affecting the design of home loans. Products including the 50-year ultra-long-term Flat 50 mortgage are becoming more widely available, while reverse-mortgage-style options also exist. As interest rates rise, households borrowing more than ¥100 million are more likely to face higher monthly repayments, and the complexity of repayment planning in the event of unexpected circumstances such as divorce or leave from work is becoming a challenge.
At the June 2026 policy meeting, interest rates were raised from approximately 0.75% to approximately 1.0%, and as of August 2026, variable mortgage rates had entered the 1% range. Further rate increases have been cited as a possibility, potentially affecting the total repayment amount on home loans and the burden on household finances. The structure supporting the central Tokyo real estate market through owner-occupier demand and inflows of global capital is changing, with implications also cited for companies’ talent strategies.