The Bank of Japan is reported to have raised its target for the policy rate from around 1.0% to around 1.25%. The article is also said to address the pitfalls of judging real estate investment solely on the basis of interest rates in response to the changing interest-rate environment.
At its September 2026 Monetary Policy Meeting, the Bank of Japan raised the policy rate from around 1.0% to around 1.25%. The prolonged low-interest-rate environment is said to be changing.
Because real estate investment is based not only on equity capital but also on financing from financial institutions, rising interest rates are said to be a factor increasing the repayment burden. However, whether purchases should be abandoned because interest rates are high cannot be determined simply. Property prices, rents, equity capital, the financing period and the future sale price must be considered comprehensively.
Although rising interest rates can reduce competition in some situations, cost factors such as higher construction, repair and labour costs are expanding, making financial planning based on long-term ownership important.
From a lawyer's perspective, it is emphasised that issues such as post-purchase repair costs, rent trends, tenant disputes and inheritance may come to the surface at different times from the purchase. This is said to require a long-term assessment of income and expenditure.