Tokyo residential occupancy rates recover close to pre-pandemic levels 

In the central five wards, occupancy is at 97%.

Residential occupancy rates in the Tokyo 23W have risen 0.2ppts QoQ to 97.1% in Q4/2023 according to Savills, also increasing by 0.7ppts on an annual basis. Occupancy in the C5W has also improved, increasing by 0.5ppts QoQ and 0.9ppts YoY to 97.0%. 

“Overall, occupancy rates appear to have generally recovered close to pre-pandemic levels, which is an encouraging sign for the market, especially for the C5W, where occupancy rates in Q4/2023 are comfortably above pre-pandemic levels,” the analyst said.

Here’s more from Savills:

With office attendance rates having recovered noticeably in 2023, central wards are being increasingly viewed as an ideal choice for those that can afford it, especially in the case of highly skilled, young professionals, which will likely support sustained higher occupancy levels in such areas. 

Going forward, the population of the 23W should continue growing and support firm residential demand in the post-pandemic environment. While central wards are expected to remain popular, residences in more affordable peripheral wards will also likely retain some popularity among renters, particularly those who are affected by inflation and lacklustre wage growth. 

In addition, hybrid work arrangements look to remain commonplace as a corporate perk, especially among large companies, which will likely support this trend. As such, while central wards are expected to retain much of the spotlight in the post-pandemic era, peripheral submarkets should still shine.