TOKYO (Reuters) – Land prices in major Japanese cities such as Tokyo and Osaka rose in 2016 by more than 10 percent, lifting nationwide prices for a second year in a row, a government survey showed on Monday.
Japan’s average land price increased 0.4 percent in 2016, a bigger rise than 0.2 percent in 2015, the National Tax Agency said.
The rise was helped by demand for land to build hotels and retail space as the number of overseas visitors to Japan in 2016 hit a record 24 million.
The tax agency data showed the biggest price rise was in Tokyo’s Ginza shopping district, where the price of a block of land increased 26 percent to 40.3 million yen ($355,682) per square meter – the most expensive spot in Japan.
A spot in Kyoto, another major tourist destination, jumped the second highest, rising 20.6 percent to 3.9 million yen per square meter.
Prices rose 15.7 percent in Osaka to 11.8 million yen per square meter, although that was a smaller increase compared with 22.1 percent in 2015 – which was the biggest rise in Japan for that year.
Osaka’s growth slowed because land values had risen too far, said Shigeo Hirayama, managing executive officer for Urban Research Institute Corp, a real estate think tank.
The tax agency accesses land prices as of Jan. 1 every year to calculate inheritance and gift taxes on properties acquired that year.
(Reporting by Junko Fujita; Editing by Neil Fullick)