Singapore investors drawn to Tokyo property market as yen hovers at 13-year low

SGD has appreciated over 35% against the yen.

Singapore investors are warming up to the idea of buying property in Tokyo as the weak Japanese yen hovers at its 13-year low, according to a new report from property investment company IP Global.

Early in June, the Japanese yen reached a 13 year low against the US dollar, sliding to 124.92 per USD, its weakest level since May 2002.

The Singapore dollar also continues to appreciate versus the yen. One Singapore dollar equalled about 68 yen two years ago. It now equates to about 92 yen, an increase of more than 35%.

This means that Singapore buyers are benefiting from cheaper property assets and soaring rental yields, the report said. 

“Tokyo has never been a more compelling case for property investors with the yen at a 13 year historic low and some real pockets of value available in the city’s wards. Singapore buyers are generally interested in small, one-bedroom flats – or ‘micro-flats’ - which offer steady yields and capital gains,” said Alex Bellingham, Director and Head of Singapore at IP Global.

The report also noted that average apartment prices in Tokyo have seen 7 months of consecutive growth up to March, particularly in the city centre. The rental average in Tokyo’s 5 wards in the centre has risen 2.9% year-on-year since 2008.

The expected impact of the 2020 Summer Olympics is also pushing up prices as President Abe invests in major improvements in public infrastructure.