The four named housing stocks are introduced as having growth opportunities, including expanding demand for remodeling existing homes, amid headwinds from BOJ rate hikes and soaring home prices.
Japan's housing market faces shrinking demand as the population declines, while soaring construction-material costs and labor costs have driven up new-home selling prices and increased the burden on households. Rising mortgage rates accompanying the Bank of Japan's normalization of monetary policy are also creating headwinds, and the sluggishness of the new-home market has been highlighted.
By contrast, the market for remodeling existing homes is expected to expand, with potential increases in demand for repairs to aging exterior walls and roofs, equipment replacement and insulation upgrades. Households that find it difficult to purchase new homes are expected to increasingly direct funds toward renovating their existing homes.
Iida Group Holdings, KACHITAS, Sekisui House and Daiwa House Industry are introduced as companies pursuing growth opportunities by strengthening remodeling and the purchase and resale of existing homes. Each company is making use of its existing customer base and the expansion of the existing-home market core pillars of its business.
Iida Group Holdings has room to grow its remodeling business by leveraging its customer base of approximately 800,000 homes, and the contribution of contracted construction profits in the fiscal year ending March 2026 is also mentioned.
KACHITAS focuses on the purchase and resale of existing detached homes in regional and suburban areas, with 153 stores and cumulative sales exceeding 100,000 properties. For the fiscal year ending March 2026, sales are performing strongly at ¥151.8 billion, up 17.2% year on year, and operating profit at ¥18.2 billion, up 28.5%. The company plans to expand the number of properties sold in the fiscal year ending March 2027.