A survey to real estate professionals in Japan revealed that the Japan real estate market will peak out in 2016-2017.

NLI Life Institute, a Japanese think tank backed by the largest insurance company in Japan – Nippon Life Insurance Company, has been conducting an annual real estate market survey. The respondents include Japan-based real estate fund managers, property managers, brokers, contractors, and consultants. The 11th installment, which was released on January 29, 2015, revealed:

1. Current status of Japan’s real estate market: Good

• 54.3% answered that the current status of the market “good”.
• 36.2% answered that the current status of the market “fairly good”.
• 5.2% answered that the current status of the market “moderate”.
• 4.3% answered that the current status of the market “fairly bad”.
• 0% answered that the current status of the market “bad”.

2. Japan’s real estate market is expected to peak out in 2016-2017

• 51.7% of the respondent answered that the price will peak out during 2016-2017 – before the Summer Olympic Games.
• 24.1% answered that the current stage is already at the peak.
• 1.7% answered in 2020, the Summer Olympic Games year will be the peak.
• The other 1.7% answered the peak will be after 2021.

3. Influence from overseas investors widens

In 2014, Japan saw the largest amount of foreign-investment in real estate. Because of this trend, non-Japanese players are becoming one of the core factors to influence the Japanese market.

Risk/influence factors for the real estate market in Japan

• Economy of the world: 23.0%
• Domestic business activity: 22.0%
• Interest rate: 14.6%
• Foreign exchange rate: 8.4%
• Politics and diplomacy: 6.5%
• Rental market: 5.9%
• Earthquake: 5.0%
• Aging population: 3.1%
• Supply of apartment: 3.1%
• Counter-terrorism measure: 1.2%
• Other: 4.3%

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