September 10, 2009 / 11:06 PM / 10 years ago

RPT-Tokyo apartment rents under pressure - research

(Repeats story that first appeared at 1500 GMT)

TOKYO, Sept 11 (Reuters) - A growing number of Tokyo residents are demanding their landlords reduce rents or are moving out to less expensive suburbs as Japan crawls out of its deepest recession in decades.

As deflationary pressures squeeze consumer spending, about 45 percent of Tokyo’s apartments with monthly rents between 150,000 yen ($1,625) and 200,000 yen reduced these charges by an average of 1.7 percent during the April-June period, research from real estate marketing firm Attractors Lab showed.

The company also found that over 70 percent of apartments that charge half a million yen or more slashed rents by about 10 percent amid an exodus of foreign expatriates and the closure of small offices in the wake of the global financial crisis.

“Given the worsening salary situation and a fall in the price index, we see that rents people can afford to pay are coming down,” the Tokyo-based firm said in a press release.

Separate data from real estate research firm Tokyo Kantei showed that the average rent for apartments in Tokyo fell 0.3 percent in July from the previous month.

But rents on apartments built in areas neighbouring Tokyo such as Kanagawa, Saitama and Chiba picked up, the research showed, suggesting that people have started moving out of the capital to less-expensive suburbs that offer relatively convenient commutes into the city.

“Tokyo’s average rent could come down as much as another 5 percent in the next few years,” said Tokyo Kantei chief analyst Takeshi Ide.

“But given the potentially strong latent demand for rooms in Tokyo, I think such price-adjustments won’t last too long and that the market will find support once the current imbalance in apartment supply and demand improves,” he said. (Reporting by Mariko Katsumura; Editing by Joseph Radford)

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