We still have accommodation available during the peak season this winter.
Last minute accommodation is still available in these fantastic properties!
One of Taiga's largest projects to date, Ginga is moving along quickly! With 7 bedrooms, media room, garage, man-cave, open LDK, and balcony jacuzzi, it aims to set a new benchmark for luxury.
Kokage House in Lower Hirafu Village was recently featured in the venerable Wall Street Journal! Check out the link to see the story in full:
So what's up with construction prices in Niseko? They are up, part of a bigger trend across the country. Quotes for pending Taiga projects have been up significantly over a year ago, by as much as 20 ~ 30%. Collaborating Sapporo architects have been cringing, since their initial advice based on years of experience rings a little hollow when the quote slides across the table. Unfortunately, the reasons are much bigger than our little Niseko property market:
1) Large infrastructure and peripheral residential/retail projects for the Olympics means the big construction companies are already locking in available labour. The larger construction companies starting telling me this shortly after the Olympics were announced, and I initially dismissed it as an excuse to justify a higher quote. But then I started hearing trickles that rebuilding in tsunami affected Tohoku is suffering, due to the "Olympic labour shortage". The Big Boys have put the word out to form carpenters and steel workers… something like "whether there is work or not, you are with us for the next 6 years".
2) Massive infrastructure projects in the tsunami affected areas are finally underway. Hard to believe, given the tsunami happened in 2011, until you have worked with Japanese bureaucracy. The scale of the rebuilding is hard to fathom… we are talking about 100s of kilometres of coastline.
3) The increase in consumption tax to 8%, and talks of raising it to 10% (currently delayed), has created a construction boom for individual houses and apartments. I have never seen so many new houses in the neighbouring farming towns of Kutchan and Niseko. Locals, who have nothing to do with tourism, have been building homes and renovating in record numbers.
4) The ageing population means tradesmen are starting to retire in big numbers. Walk onto any job site in Japan, and I can pretty much guarantee you the average age is over 50. When the owner of Kazahana came for a site inspection, he marvelled that amongst the 5 regular carpenters, there was a combined experience spanning 180 years. The upside is a phenomenal execution on the details. But the downside is just over the horizon, part of the larger impending population crunch. Sure, construction demand should also decrease concurrently, but it seems in the short term that the pending Olympics and rebuild in Tohoku are going to create a de-linking between labour and demand in the short term.
So let's raise a glass to the weak yen, which has been the only bright light in this builder's market. The diving yen can almost make the increase balance out for foreign investors (harder on us locals!). My parting advice for anyone thinking about building in Niseko is to stock up on cheap yen, because the high construction prices are probably here until the flame goes out at the Tokyo Olympics.
Keith Rodgers is the Managing Director of Taiga Project Management
Winter is on us, but it feels really hot over here. At Taiga Real Estate, we fielded an unprecedented level of enquiries for October and November, and other real estate agencies in Niseko report the same. Transactions are also up, and the local solicitor office has all hands on deck trying to process deals. Ski-In, Ski-Out are constantly requested, as are properties on the middle and lower Hirafu bluffs, but what are the emerging trends?
1. Increase in pure “lifestyle" investments, properties where the owner is not interested in rental revenue. The trend is directly measurable by the number of new properties that are not finding their way into the rental pool. Even with an apartment with fantastic lift proximity, the buyer may elect not to rent it out.
Some of this has to do with the shift to Asia based buyers, people who plan on using the property all year round. In summer, their Hokkaido property is a rare, temperate getaway from the withering summer heat of South-East Asia. For them, Niseko is a second home, which they do not want to share. The increase of high net-worth buyers is also driving this new trend.
2. The emergence of what I call the “Jackson" crowd. Jackson Hole, Wyoming is dotted with estate style properties, beautiful chalets which are secluded away on large acreages. In the past few years Hirafu has seen some beautiful new homes pop up 5 - 15 minutes drive away, and these are often bigger in scale and budget than projects inside the village. Before the global financial crisis, most of the land transactions outside Hirafu village were speculative. Now the majority of people looking for larger lots are committed to building a hideaway home. Concurrently, it is getting increasingly difficult to find truly stunning sites outside the village.
3. The buyer demographic has broadened, which has produced a real deepening of the market. Just 4 years ago, the market was dominated by Australia and Hong Kong, but these days the buyer is just as likely to be from Malaysia, Singapore, and increasingly from Thailand, Taiwan, and Indonesia. This has resulted in greater stability for the Niseko market, and economic hiccups in any one country will have a lesser effect. Although the Japanese press loves to play it up, buyers from mainland China are still relatively rare.
4. As a local, I have always enjoyed the diversity of Niseko. Even back in 1996 when I first moved here, the mountain population was varied. Purely Japanese, but from all over the country, and often well travelled. These days, interesting people from all over the world are coming to work here. You may not know it, but Kutchan and Niseko Towns are amongst just a handful of towns in Japan with a growing population. Whether you drive 10 or 15 minutes to work doesn't make any difference, so secondary properties closer to the main towns and schools have been moving more briskly.
5. While I wouldn't call it a full on trend yet, I have started to see a small trickle of soon-to-be retirees. Often half of the couple is Japanese, and they are planning a “return". Hard to stay away from the clean living, safety, and amazing food!
These trends all point to a healthy resort that is starting to mature as an international property market. The medium and long term outlook is positive, which is why I personally continue to invest predominantly in Niseko. My parting advice for buyers is to look for properties with intrinsic value, meaning views, natural setting, proximity, or size. Stating the obvious, but these core qualities will produce positive outcomes in 5 to 10 years when you decide to sell.
Keith Rodgers is the Principal of Taiga Real Estate and his two little girls have recently helped him to graduate from backcountry to the bunny slope. Please contact him for any questions on property in Niseko.