Residential rents in Tokyo 23W up 7.3% in Q1

And rents in the C5W grew by 9.9%.

In a recent report, Savills revealed that the Tokyo 23W residential leasing market has strengthened substantially by 5.0% QoQ and 7.3% YoY to JPY4,547 per sq m. Almost all constituent wards saw quarterly rental increases, while all wards experienced notable annual rental growth.

Average rents in the C5W climbed for a seventh consecutive quarter, growing by 5.2% QoQ and 9.9% YoY to JPY5,524 per sq m.

Here’s more from Savills:

Among the C5W constituents, Minato saw the most pronounced rental growth, rising by 8.0% QoQ. Indeed, while the overall number of available units in our monitored portfolio decreased by nearly a quarter, especially affordable ones, an influx of new units with premium rents appears to have notably pushed up average listed rents.

Similarly, Shinjuku, Chuo and Chiyoda experienced increments of 6.1%, 5.4% and 3.4% QoQ, respectively. Meanwhile, Shibuya recorded the softest uptick among the C5W, rising by 3.2% QoQ. Overall, the small sample size of listed units appears to amplify the magnitude of changes on listed rents, and in this context, existing owners should have more realistic views on rental growth for their own units.

Average rents in the South submarket increased by 3.2% QoQ and 5.0% YoY to JPY4,595 per sq m. Meguro witnessed the strongest growth of 4.3% QoQ while Setagaya saw the smallest gain of 1.5% QoQ. The Inner North submarket posted rental growth of 4.2% QoQ and 6.9% YoY, reaching JPY4,646 per sq m, with Bunkyo and Toshima’s average rents climbing by 4.9% QoQ and 3.5% QoQ, respectively.

Elsewhere, the Inner East’s average rents climbed steadily by 5.0% QoQ and 8.6% YoY to JPY4,406 per sq m. Koto has continued to be the best performer in the submarket for four quarters in a row, increasing by 6.0% QoQ. Taito and Sumida saw gains of 4.5% QoQ and 4.4%, respectively. In the West submarket, the average rents strengthened by 2.5% QoQ and 6.3% YoY to JPY4,067 per sq m. Suginami saw an improvement of 4.0% QoQ while Nerima recorded a modest gain at 1.0% QoQ.

The Outer North submarket’s average rents rose by 2.8% QoQ and 7.5% YoY to JPY3,917 per sq m. Itabashi’s rents improved by 3.5% QoQ while Kita saw a gain of 2.2% QoQ. The Outer East submarket saw the smallest improvement on a quarterly basis among other submarkets, growing by 0.6% QoQ and 6.3% YoY. Adachi witnessed rental growth of 2.2% QoQ while Katsushika recorded the only rent decline in the 23W at 3.6% QoQ.