The Trend of Single Room Rental increases in Japan

Demand for minpaku (temporary accommodation for one person) is gradually recovering in Japan after a sharp decline during the Covid-19 pandemic.

After Japan lifted the pandemic prevention restrictions, the number of foreign tourists renting rooms and houses in the country has increased again. Between February and March, the number of overnight tenants in Japan reached 70% of pre-pandemic levels. The trend of renting houses and temporary accommodation by foreigners has caused the prices of these places to increase.

The Trend of Single Room Rental increases in Japan ph: instagram@tokyo_minpaku

The Japan Tourism Agency said that in the months to March and March, about 251,000 people stayed at establishments registered as minpaku under the Personal Accommodation Business Act, an 80% increase from the same period last year.

Foreign tourists are leading this recovery wave with the number increasing 16 times to 91,000 people. The majority of foreign visitors come from economies including South Korea, the US and Taiwan.

Japanese people also increasingly need to rent minpaku. Before the pandemic, about 100,000 Japanese stayed in these places for a period of two months. This year, more than 160,000 people have rented the spaces above.

Many restaurants have closed during the Covid-19 pandemic. More and more young people are starting to enjoy dinner parties in rented rooms and houses. Many people choose to stay overnight to avoid contact with strangers. This has become a regular habit of Japanese people.

The weakening yen has created a wave of temporary accommodation rentals when Japanese people limit travel abroad.

The recovery in demand has driven up room rental costs. According to the Japan Tourism Agency, there were about 19,000 room rental establishments in the country as of May 15, down 10% from the peak.

LDK Project, an Osaka-based minpaku operator, raised its maximum room rate to $495 per night, a 40% increase from pre-pandemic levels.

Matsuri Technologies, a business that operates 1,200 minpaku in Tokyo and Osaka, also increased room rates compared to 2020 and 2021.

Matsuri Technologies president Keita Yoshida believes room rates will return to pre-pandemic levels this fall.

The government is also encouraging the rental trend in Japan by easing requirements for landlords starting this summer. Accordingly, those who do not have experience in the real estate or rental industry can still operate in this field if they undergo a training course.

The increasing number of tenants will lead to diversification of these facilities.