Insights from a Unique Survey on the Real Estate Market for Q2 2025

In an effort to gauge the current state and future outlook of the real estate market, Mitsubishi Estate Real Estate Services has conducted a detailed survey involving 400 real estate professionals working in areas like development and asset management. The findings reveal significant insights into the trends expected for Q2 2025.

The survey, conducted between September 30 and October 10, 2025, was aimed at capturing real-time sentiments regarding both residential and commercial real estate markets in Japan. Respondents were drawn from various sectors, including developers, asset management firms, and real estate management and brokerage businesses located in the Tokyo metropolitan area. Utilizing an online survey format, data was collected efficiently, providing a strong basis for the analysis.

The overarching sentiment among participants indicates that both the real estate sales and rental markets are in a continuing state of "expansion." Many experts believe that we are approaching the peak of this expansion, despite observable compressions in yield. An essential factor supporting market resilience is the continuous increase in rental income, further solidifying the foundation of the real estate landscape.

Market Insights

Upon analyzing different asset classes within the real estate sector, two emerging trends have been highlighted. The sales market, buoyed by an influx of inbound demand, exhibits positive pricing expectations for the hospitality sector. Hotels are, therefore, a primary focus, bringing forth strong investment confidence. On the other hand, the rental market is witnessing a decline in vacancy rates, particularly within office buildings, which are also becoming pivotal to investment strategies moving forward.

The survey outcomes also revealed contrasting views regarding future market conditions. For the immediate six-month outlook, there is a dominant belief that both markets will sustain their current growth trajectories. Yet, the data suggested an uptick in responses forecasting a downturn beyond this period, indicating a split in expert sentiment.

Key Findings

- Sales Market Analysis: A large portion of responses indicated that while the volume of listings remains stable compared to six months ago, there has been a significant uptick in sale prices. Moreover, the consensus suggests ongoing expansion in the sales market, continuing to peak within the next six months.
- Rental Market Dynamics: Respondents foresee the rental estate sector similarly expanding toward its peak over the next half-year, countering concerns regarding potential declines.
- Projected Asset Class Performance: Expectations for robust investment activity and market growth are strongest for hospitality assets, followed closely by rental apartments. These sectors are particularly attracting interest for both current and future investments.
- Commentary on Price Trends: When evaluating asset acquisition strategies, hotel investments generated the most optimistic price outlook, although rental apartments are also displaying strong potential combined with a bullish stance on pricing.
- Expectations for Vacancy Rates: Despite a general expectation that vacancy rates will remain stable, a notable decrease is anticipated within the office sector, alongside shorter free rental periods reflecting stronger demand.

Mitsubishi Estate aims to continuously facilitate a deeper understanding of the real estate market and its challenges through the publication of survey findings. The insights garnered from this research are intended to help stakeholders navigate the evolving landscape of Japan's real estate sector more effectively.

For detailed insights and comprehensive reports, download the full survey results through our official channels.