The Yen’s Strength Lights Up Japan’s Property Market as Trump Tariffs Loom

TradingKey - As the yen strengthens against the dollar, Japanese real estate emerges as a strategic investment amid global uncertainty fueled by Trump’s trade tensions.  

Banks highlight Japan’s property sector advantages during inflationary periods: low vacancy rates, stable rental yields, and a tourism rebound. With Trump tariffs unsettling global markets, Japanese authorities are likely to prioritize exchange rate management.  

According to the Nikkei, nearly half of Tokyo’s overnight stays in 2024 were by foreign visitors. January saw a record 3.78 million international arrivals, underscoring tourism’s robust recovery.  

This surge has driven hotel prices higher. Tokyo’s average daily room rate in 2024 rose 55% from pre-pandemic 2019 levels and 20% year-over-year.  

However, rising interest rates may temper residential price growth. Japan’s secondary home prices fell 1.1% in 2024—the first decline since 2013. Second-hand housing sources account for 90% of Japan's residential market.

Even in prime Tokyo areas, buyers remain selective, brokers note.