Olympics might bolster already positive sentiment stemming from the pro-growth stimulus measures put in place by the Prime Minister Shinzo Abe, said panelists at the PERE Tokyo Forum held last week. But it is unlikely to be a key driver, they said.
Benjamin Lee, managing partner of Hong Kong-based Phoenix Property Investors told PERE that the increase in the visitors to the country due to the sporting event as well as the depreciating yen would benefit the country's property market.
In terms of asset classes, Hiroyuki Akoki, executive director, SC Capital, said that the residential sector, especially in areas with close proximity to the games venue, could see an increase in demand, for examples.
However he also added that the impact on real estate wouldn’t be as huge as expected. “There is definitely an expectation that the market will go up, and the prices will rise. But people think that there is much linkage of the Olympics to real estate. I don’t think so,” he said. “It just happened to be now at the same time as abenomics is trying to stimulate the economy.”
With high commercial real estate prices in Tokyo and an increase in foreign investors’ interest, questions have been raised on whether the Japanese real estate market has already reached its peak.
But both Akoki and Lee said that the outlook for the market remains positive for the medium term. “After a 20-year plus adjustment in the real estate market and the very benign availability of capital at the moment, the talk about a peak after only three years of recovery is short term view,” said Lee.