Tokyo Apartment Prices Exceed 100 Million Yen Average... Why Are People Leaving? [Kim Yongnam's Real Estate Asset Management]

The first formula that comes to mind when explaining Tokyo's residential market was overwhelming excess demand. In a megacity where jobs and opportunities are concentrated, rising housing prices have been considered a perfectly natural result of economic logic and evidence of urban growth. However, recent changes in the Tokyo apartment market show that this classic formula no longer works as it used to. While housing prices are soaring to new record highs every day, the influx of people who support the city is noticeably decreasing. This is not just a temporary market adjustment, but a strong signal that the residential structure of Tokyo and the map of the metropolitan area are fundamentally changing.

In 2025, the average price of new apartments in Tokyo's 23 wards soared by 21.8% year-on-year to 136.13 million yen. In particular, the average price in the six central wards jumped 20.2% in one year to 195.03 million yen, approaching the peak of 226.62 million yen in 1990 when the real estate bubble was at its height. What we need to pay attention to here is the psychological pressure of the absolute price rather than the simple rate of increase. Whereas in the past, Tokyo's housing prices remained within a realistic range that could be reached through diligent work and savings, current prices have become an immediate barrier that pushes the middle-income class out of the market altogether. In a situation where the speed of income growth cannot possibly catch up with the rise in asset prices, once the price barrier exceeded a certain threshold, buyers are turning to the outskirts of the metropolitan area instead of giving up.

Recent population movement statistics released by the Japanese Ministry of Internal Affairs and Communications prove this change with concrete figures. In 2025, the net influx of population into Tokyo was 65,219, a decrease of 14,066 from the previous year, marking the first time the increase has slowed in four years. What is more noteworthy is that the net inflow into the 23 central wards plummeted by 19,607 from the previous year to 39,197. This suggests that the criteria for choosing a place to live have completely changed. An interesting point is that Saitama, Kanagawa, and Chiba prefectures, which are adjacent to Tokyo, are absorbing Tokyo's population and emerging as new centers. Saitama Prefecture saw a net inflow of 22,427 people, an increase of 691 from the previous year, and Kanagawa Prefecture also had a net inflow of 28,052, an increase of 1,089. This should be interpreted not as a phenomenon of 'leaving Tokyo' where people are completely leaving the city, but rather as a phenomenon where people are giving up or postponing entry into the city center, blocked by Tokyo's high price barrier.

This movement is not simply due to a change in lifestyle preferring a pleasant environment. It is the result of a thorough calculation of economic benefits. Housing purchase costs have already exceeded what households can afford, and the concurrently soaring rents are eroding disposable income and taking away the余裕 (yoyū, or room) in life. In December 2025, the average monthly rent for a studio apartment in Tokyo's 23 wards was 106,854 yen, an increase of about 10,000 yen in one year, reaching the highest level since 2015. Even young people and high-income newlyweds, who in the past would have insisted on entering the city center even if it meant overstretching themselves, are now finding a practical compromise between commuting time and housing costs. It is not that Tokyo's urban appeal has diminished, but that its cost structure has completely deviated from a reasonable range that ordinary citizens can bear, transforming it into a space for a select few.

Ultimately, apartments in central Tokyo are completely changing in character, becoming not a universal residence that anyone can dream of, but a class-based asset occupied and traded only by a specific class. The city center is solidifying as a space for investment and asset preservation, and the center of gravity for actual residence is gradually shifting to outlying areas, accelerating the phenomenon of polycentricity where the entire metropolitan area is divided into several hubs. The Tokyo Metropolitan Government has proposed a plan to supply affordable rental housing by easing floor area ratios, but this is close to a stopgap measure to mitigate the ill effects of single-pole concentration. Today's Tokyo is not just a dangerous city because it is expensive, but a city where the resident class and way of life have fundamentally changed due to prices. In the future, we must pay more attention to where those pushed out of the market are forming new residential bases, rather than the price indicators themselves. This is because the change in Tokyo is not a decline, but a turning point in the massive reorganization of the entire metropolitan area's spatial structure.

<The Korea Economic Daily The Moneyist> Kim Yongnam, CEO of GlobalPMC Co., Ltd.