Average commercial land price posts 1st fall in 2 years in Japan+

TOKYO, Sept. 18 Kyodo - The nationwide average of commercial land prices in Japan fell 0.8 percent in
the year to July 1 after posting the first upturn 16 years the previous year,
the government said in a land price survey report Thursday.
The downturn is attributable to an economic slowdown, slack demand for office
buildings and decreased real estate investment, said Ministry of Land,
Infrastructure, Transport and Tourism officials.
Many foreign investment funds have withdrawn investment in Japan in view of the
U.S. subprime mortgage crisis and even Japanese financial institutions reduced
real estate loans on concerns the loans may go sour, they said.
The nationwide average of residential land prices declined 1.2 percent,
accelerating a fall for the first time in five years.
Average commercial land prices in the three metropolitan regions of Tokyo,
Osaka and Nagoya saw a 3.3 percent rise, far slower than the 10.4 percent
increase the previous year. The residential land price average in the three
regions chalked up a 1.4 percent increase against a 4.0 percent gain a year
earlier.
Excluding the three metropolitan regions, the commercial land price average
fell 2.5 percent and the residential land price average 2.1 percent. These
declines were slightly slower than in the previous year.
Commercial land prices in each of the three metropolitan regions rose for the
third straight year, with the Tokyo region up 4.0 percent, the Osaka region 2.8
percent and the Nagoya region 1.9 percent. But the rate of rise slowed in all
the three regions.
The metropolitan centers saw commercial land prices peaking in January. At 28
commercial locations in central Tokyo, where land price figures are available
for Jan. 1 and July 1, land prices rose sharply from July 2007 to January this
year.
But at 21 of these locations, prices leveled off or fell from January to July.
During the year to July 1, residential land prices rose 1.6 percent in the
Tokyo region, 1.0 percent in the Osaka region and 1.5 percent in the Nagoya
region.
Of the 47 Japanese prefectures, 10 including Miyagi and Saitama scored
commercial land price hikes. But eight other prefectures including Toyama and
Ehime saw faster commercial land price declines.
Residential land prices rose in eight prefectures including Chiba and Shiga.
Among the commercial locations subject to the government land price survey,
Aoba of Sendai in Miyagi Prefecture recorded the fastest land price hike at
22.3 percent.
Of the residential locations, Kutchan in Hokkaido Prefecture saw a 40.9 percent
land price jump. Due to growing demand for housing for foreign skiers, the ski
resort town registered the highest residential land price hike for the third
straight year.
The highest commercial land price of 30 million yen per square meter was
fetched at the Meidi-ya Ginza building in Tokyo's Chuo Ward. A location in
Tokyo's Chiyoda Ward recorded the highest residential land price at 3.4 million
yen per square meter.