Resale of Niseko’s Urban Area: Are Foreigners the Savior of Vacant Homes?
Foreign Investors Buying “Vacant Houses” and “Stores” in Front of Train Stations
The town of Kutchan in Hokkaido is home to the ski resort of Niseko, where luxury hotels and condominiums are opening one after another. While the Niseko-Hirafu resort area is booming with inbound visitors, in the urban area of Kutchan, about 7 to 8 kilometers away from the resort, “vacant houses” are being bought one after another by foreign investors.
We are seeing wealthy foreigners buying up vacant houses around Kutchan Station and empty stores in the Ekimae-dori shopping street,” says one foreign investor.
Naohisa Takiguchi, who runs a ski and snowboard store on the Ekimae-dori shopping street, says this is the current situation. Mr. Takiguchi runs a corporate real estate business on the side and is knowledgeable about the housing and retail situation in the town.
According to the plan,Kutchan station of the Shinkansen will be built in ’30, and foreign investors and business owners have been buying private houses and store properties in the city center for several years, as real estate prices in front of the station will more than double within 10 years, ” said Mr. Takiguchi.
Although the extension of the Hokkaido Shinkansen to Sapporo may be delayed due to construction delays and increased costs, it is currently scheduled to open within FY30. The time required between Kutchan and Sapporo will be reduced to about 25 minutes, less than a quarter of the time required by conventional train. It is expected to serve as the gateway to Niseko.
The Trans-Hokkaido Expressway (Goshi Expressway) is also scheduled to open and the Kutchan Interchange will be built, although the timing has not yet been determined.
Investors buy vacant storefronts in the shopping area in front of the station and rent them out to people doing business in the resort area. The stores are usually offices on the first floor and residences for the employees on the second floor.
As in any town, Kutchan’s shopping district is aging. Many owners are in business now but want to sell in a few years due to lack of successors. These people put their stores and residences up for sale on the condition that they will be vacated in two or three years, and foreigners buy them for investment purposes through real estate agents.
Some delivery and catering stores that have been operating in the resort area are now moving to the downtown area of Kutchan.
Rent in the resort area is going up rapidly, and both foreigners and Japanese are moving to the city center because they can’t afford to do business this way. They are renting properties with kitchens and delivering from the city to condominiums in the resort area.
I think prices will go up four to five times when the bullet train and expressway come through.”
Private homes are selling on the outer edges of the commercial area in front of the station and in the residential area that stretches behind the station.
The back side of the station is still cheaper than the area in front of the station. However, when the Shinkansen bullet train and expressway come through, I think prices will increase four to five times.
Foreigners are buying houses in anticipation of this and renting them out to businesses. There used to be Chinese and Taiwanese who bought a house as a vacation home, but now there are very few. The pattern is often to remodel the house they bought and turn it into a private residence or a shared house. Some of them even resell their houses for double or triple the price after remodeling them.
There are also an increasing number of cases where people who do business in resort areas buy houses not for investment purposes, but to house their staff. For example, ski and snowboard school operators are buying to use as dormitories for their instructors.
