Investment Property in Tokyo

Investment Real Estate in Tokyo

Tokyo property investment can be a worthwhile venture if you are selective with the areas you choose to invest in. If not, you could find that your investment suffers due to low rental yields, dwindling demand, and slow property price growth in many parts of Tokyo.

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Search Map of Tokyo Investment Real Estate

Tokyo ( TOH-kee-oh, -⁠kyoh; Japanese: 東京, Tōkyō [toːkʲoː] (listen)), officially the Tokyo Metropolis (Japanese: 東京都, Tōkyō-to), is the de facto capital and most populous prefecture of Japan. Located at the head of Tokyo Bay, the prefecture forms part of the Kantō region on the central Pacific coast of Japan’s main island of Honshu. Tokyo is the political and economic center of the country, as well as the seat of the Emperor of Japan and the national government. As of 2021, the prefecture has an estimated population of 13,960,236. The Greater Tokyo Area is the most populous metropolitan area in the world, with more than 37.393 million residents as of 2020.

Originally a fishing village, named Edo, the city became a prominent political center in 1603, when it became the seat of the Tokugawa shogunate. By the mid-18th century, Edo was one of the most populous cities in the world at over one million. Following the end of the shogunate in 1868, the imperial capital in Kyoto was moved to the city, which was renamed Tokyo (literally “eastern capital”). Tokyo was devastated by the 1923 Great Kantō earthquake, and again by Allied bombing raids during World War II. Beginning in the 1950s, the city underwent rapid reconstruction and expansion, going on to lead Japan’s post-war economic recovery. Since 1943, the Tokyo Metropolitan Government has administered the prefecture’s 23 special wards (formerly Tokyo City), various bed towns in the western area, and two outlying island chains.

Tokyo is the largest urban economy in the world by gross domestic product, and is categorized as an Alpha+ city by the Globalization and World Cities Research Network. Part of an industrial region that includes the cities of Yokohama, Kawasaki, and Chiba, Tokyo is Japan’s leading center of business and finance. In 2019, it hosted 36 of the Fortune Global 500 companies. In 2020, it ranked fourth on the Global Financial Centres Index, behind New York City, London, and Shanghai. Tokyo has the world’s tallest tower Tokyo Skytree and the world’s largest underground floodwater diversion facility MAOUDC. The Tokyo Metro Ginza Line is the oldest underground metro line in East Asia (1927).

The city has hosted multiple international events, including the 1964 Summer Olympics and three G7 Summits (1979, 1986, and 1993); it will also host the 2020 Summer Olympics, which were ultimately postponed to 2021 due to the COVID-19 pandemic. Tokyo is an international center of research and development and is represented by several major universities, notably the University of Tokyo. Tokyo Station is the central hub for Japan’s Shinkansen bullet train system, and the city is served by an extensive network of rail and subways. Notable districts of Tokyo include Chiyoda (the site of the Imperial Palace), Shinjuku (the city’s administrative center), and Shibuya (a commercial, cultural and business hub).

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The financial stability of Tokyo has translated into a real estate market that rewards forward planning and a willingness to look beyond areas of traditional affluence.

Buy to Rent in Tokyo

Renting out your Tokyo buy-to-rent investment property can grow wealth and income.

Whatever your goals with investment property in Tokyoare – preparation is key.

Set goals based on how much rental yield will be required and the local rental yield rates in Tokyo and be prepared to change your initial outlook.
Thoroughly research the Tokyo location with a special emphasis on fringe areas outside the main Tokyo metropolis that may be valued lower than their better-known neighbours. Rental yields of around 5% are still attainable in certain areas of Tokyo.
Ensure that your target investment property in Tokyo appeals to professionals. This is a demographic that ensures maximum income and low voids.
Finding and vetting suitable tenants is a job ideally left to the professionals. Working with an established letting agent such as Physis Realty with local knowledge and experience of property legislation will give you the best chance of success.
You may think that managing your Tokyo properties yourself is an easy option, but are these savings justifiable when you run into Tokyo red tape? Physis Realty Tokyo office in downtown provides you with peace-of-mind and leaves you time to plan your next move in the growing Tokyo buy-to-rent sector.

With our expert guidance, investing in Tokyo provides the secure knowledge that your money is working harder than it would in a local Tokyo bank and that future generations of your family will be left with substantial capital growth assets.

We are always happy to advise on buying investment property in Tokyo, where we have been established for over 35+ years. Physis Realty has been a firm fixture in the Tokyo property market through good times and bad. Our experts have seen it all and our portfolios continue to outperform.

Flipping Investment Property in Tokyo

Flipping property in Tokyo

Flipping property is when we advise clients to buy a Tokyo property below market value, renovate it and then make a profit by selling it at a higher price, all within a few months, and often before the Tokyo market has a time to react to the renovation.

The Flipping Strategy in Tokyo

Investment property flipping in Tokyo is a simple strategy. You find a property that is in need of renovation from our list and purchase it for a low price. These type of Tokyo real estate investments are sometimes referred to by professionals as ‘distressed’ Tokyo real estate.

What is distressed Tokyo property:

Tokyo property in need of renovation
Tokyo real estate with a change of puropose and use
Oversold Tokyo property
Bank repossessions in Tokyo

Put simply, long term investors in Tokyo purchase the property, renovate it and make it a lot more attractive to potential buyers.

Calculate profit that you make from Tokyo investment property flipping:

Final Selling Price less Cost of Purchase less Costs = Profit

Here is an example:

Tokyo property purchase price: $220,000

Renovation costs: $20,000

Other costs: $25,000

Property sale price: $400,000

Profit: $135,000

Experienced property developers in Tokyo use a minimum profit value of 22% when looking at potential Tokyo projects. The reason for this is because there are lots that can go wrong in Tokyo property flipping and working on a potential margin of 22% should still leave a good margin of error.

Luxury Property in Tokyo

For luxury property investors hoping to add a superb property in {AsainCity} to their luxury real estate investment portfolio, Physis Realty is a trusted partner.

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A world leader in luxury real estate with a portfolio comprising some of the most sought-after real estate in Tokyo, Physis Realty caters particularly to high net-worth individuals and families in Asia. A luxury real estate investment in Tokyo should be entrusted to only the highest-quality agency.

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