Tokyo residential occupancy rates slip to 96.6% in Q4

But occupancy in the C5W slightly increased to 96.2%.

Occupancy rates in the Tokyo 23W rose by 0.3ppts over the quarter to 96.6% in Q4/2024, down 0.4ppts on an annual basis, according to data from Savills. Meanwhile, occupancy rates in the C5W increased by 0.3ppts QoQ to 96.2%, while remaining lower by 0.7ppts on an annual basis.

Given the strong wage growth in 2024, many asset managers appear to be capitalising on the opportunity to raise rents, rather than prioritising full occupancy sooner. Overall, occupancy levels remain high and are expected to grow over time.

“Net migration into the Tokyo 23W has reached new highs in 2024, with foreign nationals comprising approximately half of net migration so far this year, generating solid demand for rental units. Foreign nationals are expected to continue migrating to Tokyo, and should become an even larger proportion of rental demand, particularly due to their higher propensity to rent rather than buy. As a result, occupancy levels should continue to increase,” the analyst said.