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Will Japan’s declining birthrate cause real estate prices to fall?

Recently, there’s been a common narrative in youtube and online sources suggesting that “with the decline in population, real estate prices will fall.” However, this perspective might be overly simplistic. It’s essential to consider that real estate companies could be presenting this information with a specific intention. A surge in real estate values doesn’t always benefit these real estate companies, as exceedingly high prices might deter potential buyers.
Globally, the trend indicates a rise in real estate prices. In Japan, despite many experts anticipating that the Nikkei Stock Average would plateau, it has continued its upward trajectory. It’s genuinely challenging to predict future movements accurately.
The issue of a declining birthrate in Japan is a pressing one. To counter the dwindling workforce, the Japanese government is actively deliberating on increasing the intake of foreign workers. Should this initiative progress, housing demand might surge to accommodate these international workers. Additionally, with a notable increase in property acquisitions by foreigners, especially from China, it’s hard to foresee a drop in prices anytime soon.
Japan has been grappling with deflation for an extended period. However, with the current global inflationary trends, the nation is witnessing a rise in general prices. Given this context, it seems probable that real estate prices in Japan will also ascend. At this juncture, Japan’s property market appears enticing to numerous investors.
To conclude, determining real estate prices isn’t merely a function of population. A myriad of factors come into play, and basing predictions solely on population dynamics can be misleading.