Shift in Used Apartment Market in Q1 2026: Price Reduction Pressure Intensifies in Tokyo's 5 Central Wards

■ Q1 2026 Overview: The Market Quietly Reaches a Turning Point

As we enter April 2026, the first quarter has already passed. Looking back at the used apartment market during this period, while there appears to be no major fluctuation at first glance, a closer look reveals that distortions are clearly beginning to emerge on an area-by-area basis. In particular, a temperature difference in the market is gradually becoming apparent between central Tokyo and other areas.

■ Growing Price Reduction Pressure in the 5 Central Wards

The most notable change compared to the previous quarter is the widening of the price reduction margin in the five central wards. The price reduction rate for used apartments in these wards was 5.77% from October to December 2025, but it rose to 6.24% from January to March 2026, the highest level since 2023.

What is even more noteworthy is that this price reduction rate has been continuously increasing since the July-September 2024 period. This suggests that it is not a one-off adjustment, but rather that structural pressure forcing sellers to revise prices is strengthening. The fact that a shift in the supply-demand balance is beginning to occur in the five central wards, which have so far driven price increases, is an important signal for the market as a whole.

■ The Entire 23 Wards Area Remains Stable

On the other hand, the situation is quite different when looking at the entire 23 wards of Tokyo. The price reduction rate for used apartments from January to March 2026 was 5.53%, only a slight increase from the previous quarter, and overall, it continues to trend sideways.

From this, it can be confirmed that, at least from a macro perspective, there are no signs of a rapid market deterioration or a collapse in supply and demand in the 23-ward market. In other words, the strengthening of price reduction pressure seen in the five central wards has not spread to the entire 23 wards and is a phenomenon limited to specific areas.

This contrast between "localized adjustment" and "overall stability" is a crucial perspective for understanding the current market.

■ Changes in Liquidity: Properties in the 5 Central Wards Are Becoming Harder to Sell

Furthermore, looking at the trends in sales period and the number of price reductions in the five central wards, both are showing an increasing trend. This means that not only are prices being lowered, but a situation is emerging where properties are "difficult to sell even after a price reduction."

Compared to the previous market environment where a certain level of price adjustment would lead to a sale, it can be inferred that buyers are now being more selective. It is possible that higher standards are being demanded not only in terms of price but also in complex factors such as location, age of the building, floor area, and brand.

In contrast, for the entire 23 wards, there is no significant difference in the sales period or the number of price reductions compared to the previous quarter, and liquidity is also trending sideways. In other words, it is not that market liquidity as a whole is declining, but rather that the decline in liquidity is becoming apparent only in the five central wards.

■ Market Polarization Became Apparent After 2023

Behind these movements lies a structural change in the used apartment market that became apparent after 2023. Particularly symbolic was the unusual phenomenon from July 2023 to July of the following year, where the contract price per tsubo for each month exceeded the new listing price per tsubo.

During this period, a situation occurred where high-priced used apartments were sold preferentially. However, this distortion was not sustainable in the long term and became a factor that caused a discrepancy in the very premise of price formation.

As a result, the market was divided into a "fair price range supported by actual demand" and a "high price range that rose on expectations," leading to the progression of so-called market polarization.

■ Backlash in the High-Priced Market Becomes Apparent

Entering 2026, the impact of this polarization has become even clearer. Especially in high-priced markets like the five central wards, a backlash against the continuous rise in prices is beginning to manifest.

In other words, the expectations of market participants who had premised on "prices continuing to rise" are now being revised. On the buyer's side, a cautious stance is strengthening based on the interest rate environment and future uncertainties, and the gap with sellers' price settings is thought to be widening.

As a result, a supply-demand adjustment is in progress, as reflected in indicators such as rising price reduction rates, longer sales periods, and an increased number of price reductions.

■ How Should We View the Future Market?

Based on the above, the current used apartment market can be summarized not as a "full-scale downturn phase" but as a "phase where selection by area and price range is progressing." Particularly in the five central wards, the adjustment to the recent upward trend is in full swing, and sluggish movements are likely to continue in the short term.

On the other hand, liquidity is still being maintained in the entire 23 wards, and the market supported by actual demand remains firm. Therefore, for future market analysis, it will be essential to grasp a more micro-level supply-demand structure, rather than the conventional simple formula of "city center = strong."

The market is currently in an adjustment phase for the next growth stage. Within that, the future focus will be on which areas and which price ranges can acquire sustainable demand.