Tokyo Population will continue its upward trend until…

"Papa, can we go swimming today?"

“Papa, can we go swimming today?”

The reason why Blackstone Group LP agreed to buy GE Japan Corp.‘s residential-property business in 2014 for more than ¥190 billion ($1.61 billion) to expand its holdings in Japan, is because Blackstone’s financial research people know there will be continued growth in population in the city of Tokyo. GE Japan Corp. that was acquired by Blackstone in 2014 owns and operates more than 200 properties with more than 10,000 residential units, mainly in Tokyo, Osaka, Nagoya and Fukuoka. The New York-based company, the biggest U.S. single-family rental-home landlord, said in 2014, “it’s making the purchase partly with its new Asia real estate fund.” More and more people from around Japan continue coming to Tokyo looking for work and to seek their fortunes. This population growth trend will continue and this also means increased rents and real estate prices.

Think Tokyo is dense with people now? Wait ten years, according to this trend it will continue just as it has the for the past 20 years with 9,949 people moving into Tokyo in 2015. The cities of Nagoya, Hyogo, Osaka and Nara all indicate net population reduction according to city registry records. The upside of this is that you can pick up properties for a pittance in the countryside in Japan. On a trip to the Chichibu area to check out property prices, I came across a small farm with buildings and land for ¥8 million. What is Japan (Tokyo) going to do to prepare for the huge increase in people coming to Tokyo for the 2020 Olympics? Can anyone image just how expensive it will be in four years from now with this continued increase in population in Tokyo? It means that anywhere from 40,000 to 50,000 more Japanese will move to Tokyo in this period of time if the same trend continues. It also will mean costs for living are going to skyrocket too because there will be less people in the countryside in Japan raising food to feed Tokyo. Costs on real estate are going to steeply increase as well as other living costs. Don’t forget to bring your car to Tokyo so that you can pay ¥50,000 (US$500) every month to park it outside your ¥250,000 a month one room apartment. What will be of concern are Japan’s “zombie companies” dying off, so where will this steady influx of young Japanese coming to Tokyo find work?

The Largest City In The World In Terms Of Population – Tokyo