The number of home purchases by young people is rapidly increasing due to soaring prices and ultra-long-term loans

With soaring real estate prices and rising interest rates, an increasing number of young families are rushing to buy a home. The impatience that ``the longer you wait, the less you can buy'' and the emergence of ``ultra-long-term loans'' that extend to 40 or 50 years are pushing back. On the other hand, many young people continue to rent to keep housing costs low. Experts say, ``It's better to buy in an area where asset values ​​can be maintained,'' but warn against the risk of investing a large portion of your household budget into housing while you're still young.

According to the Ministry of Internal Affairs and Communications' Family Income and Expenditure Survey, the home ownership rate (detached houses/condominiums) for households with two or more people headed by someone in their 20s or younger was 40.7% last year, the highest since 2000, when comparisons were made. This suggests that the proportion of couples in their 20s buying a home is increasing.

The standard purchase price is six to seven times the annual household income, but according to a survey by Recruit, the percentage of people who bought a new condominium in the Tokyo metropolitan area for more than eight times the annual household income jumped from 7.1% in 2009 to 20.4% in 2024, regardless of age.

The background is the rise in real estate prices and interest rates. According to the Real Estate Economic Research Institute, the average price of newly built condominiums in the Tokyo metropolitan area exceeded 100 million yen for the first time in the first half of this year from January to June. The price for the Kinki area was 54.53 million yen, the second highest price on record after the first half of 2014, and exceeded the price in the first half of 1991 (52.21 million yen) during the bubble period.