Nagoya is one of the biggest city in Japan, but often overshadowed by Tokyo and Osaka.
I’ve been to Nagoya 3 times in total, doing business trips, travelled and attended my Japanese friend’s wedding.
Personally, I believe it’s a great city, with cheap restaurants and it’s generally livable.
Many locals and foreigners have opened up their eyes for Nagoya due to the above mentioned reasons, offering a greater quality of life compared to the more expensive cities.
However: before you buy a Nagoya property, it’s important that you study well beforehand and learn the local areas and market.
In this article, I explain the basics you need to know when buying an apartment in Nagoya.
Property market outlook in Nagoya
Japan is a different property market compared to other countries in the world, for mainly one unique reason – its declining population.
It’s one of the few countries in the world where the population is actually shrinking, affecting the property market too.
Currently, there are millions of empty houses in Japan, Nagoya is not different.
This makes many wonder how Japan or cities like Nagoya can be a good option for a property investment, considering the basic “demand and supply” rule?
The fact is:
In Japan, there’s a rising demand for modern apartments, compared to traditional family houses. This is why, even when Japan is going through a slower economic growth, the housing prices in urban centers remain upbeat.
The interest from local buyers, combined with foreign investments into new apartment projects, has boosted the apartment prices.
So how is Nagoya performing?
Nagoya, which is the third largest incorporated city in Japan, is a bit different. The apartment occupancy rate has been falling since 2013.
This is why apartment prices have not increased as much as in other cities.
In 2017, there was a little bit more than a 1% increase in the asking prices of apartments in Tokyo. But prices dropped in Nagoya during the same time.
If you compare with Osaka/ and Tokyo, occupancy rates are increasing. Thus, the prices and rental yields are higher in these cities, compared to Nagoya.
Tokyo and Osaka are better options if you seek high rental yields or capital growth.
Should I buy an apartment in Nagoya?
Projects like the upcoming bullet train from Tokyo to Nagoya might lead to appreciations in the long term. But currently, the prices are not increasing with the same rate as in other cities.
Nagoya has emerged as the more affordable option in the last few years, due to lower rents and affordable apartment prices.
Locals and foreigners why search for a more livable place, with lower prices, moves to Nagoya instead. This might increase the prices and rental yields in the future.
Nagoya is a good option if you find Tokyo and Osaka expensive.
Where should I buy property in Nagoya?
Nagoya is situated between Tokyo and Osaka, the two most popular cities among foreigners.
It’s the fourth most populated city in Japan, with more than 2.3 million residents. Still, it’s not as congested as Tokyo and Osaka.
In the last few years, many foreigners moved to Nagoya as it’s been rated as more livable and affordable.
So which areas are most popular among foreigners?
Nagoya is divided into 16 administrative wards, but the most popular wards among foreigners are Sakae, Meieki, Naka and Nakagawa.
Buying an apartment in Sakae
Sakae is the main entertainment and business district of Nagoya, and also among the most densely populated areas.
The prices here are higher compared to other wards, but you can also earn higher rental yields due to the surrounding business district.
The average rent is second-highest (after Fushimi) among the city areas.
Sakae is also located only a few kilometers east of Nagoya Station, acting as a transport hub.
You can find plenty of entertainment and dining options, trendy shops, high-end boutiques and large department stores here.
This makes it one of the most desired residential places for those who want to be in the center of the action, making it a good option for you to invest for higher rental yields.
Buying an Apartment in Meieki
Nagoya Station is situated in Meiki which consists of the surrounding areas of the station. It’s densely populated with shopping centers, restaurants and many corporate offices.
The apartment prices are generally higher here, but you can also expect higher rental yields.
Meieki is the third most expensive wards in the city after Sakae and Naka.
If you are looking for a long term investment, this might be your place. A newer and faster bullet train will be completed in 2027, connecting Nagoya and Tokyo.
With less time (only 40 minutes) between Nagoya and Tokyo, and Meieki as the main station, this area is expected to grow faster than other wards.
Buying an Apartment in Naka
Naka is the main entertainment hub, and often considered to be Nagoya’s equivalent of Tokyo.
Located in the center of the city, it’s also one of the most popular districts for foreigners. You can easily find nightclubs, bars, western-style restaurants and five-star hotels.
Fushimi station is also located in the same ward, which makes commuting easier for the locals.
The prices here are also higher. It is ranked as the most expensive areas in the city to live.
On the contrary, the rental yields are also highest in the city.
Buying an Apartment in Nakagawa
Nakagawa consists of the areas around Kanayama Station, which is the city’s most important rail hub that connects Nagoya to Chubu International Airport.
You can find all modern day luxuries here as it’s surrounded by bars, restaurants, shopping centers and karaoke clubs.
But it’s not as densely populated as many other areas. This makes it a good option for expats who want to live in an area that is not as congested.
So what about the property prices?
The prices here are slightly lower than the top three options, but rental yields are also less.
In total, there are 16 wards in Nagoya, but the above mentioned wards and areas are the most popular among the foreigners.
These areas also offer higher rental yields compared to other wards.
Property prices in Nagoya
You can find cheaper property in areas surrounding Kanayama Station, while prices are higher in Fushimi, surrounding areas of Nagoya Station and Sakae.
You can expect to pay somewhere between JPY 12,000,000 (built in the 80’s and 90’s) to JPY 30,000,000 (for a newly built 2 bedroom apartment).
The prices may also vary based on the area. Areas near the city center and train stations are expensive.
Realtors / Real estate listings in Nagoya
It’s not always easy to study the property taxes, rules and regulations in Japan, due to the language and cultural barrier.
This is why you need a local Realtor, who can help you.
Some of the top realtors and real estate listing websites are:
b. Foreclosed Japan
c. Japan Home Finder
d. Rise Property
How high are the rental yields in Nagoya?
You can expect slightly lower rental yields in Nagoya compared to other cities.
In most of the Japanese cities, rental yields increase to 1-3% a year. The same it goes in Nagoya.
How are rental yields in Nagoya compared to other cities then? Not high unfortunately.
If you compare Nagoya with other cities like Tokyo, Osaka and Yokohama City, the rental yields in Nagoya are the lowest.
In fact, out of the 7 major cities (Tokyo, Yokohama City, Saitama, Chiba, Osaka, Kobe, and Nagoya), only Chiba has lower rental yields than Nagoya.
On the positive note, lower rents are also the reason why many foreigners and locals are moving to Nagoya.
If this trend continues, rental yields and property prices are expected to increase in the future.