Back in July 2006 the board of the BOJ voted unanimously to raise the overnight call rate from zero to 0.25%. This week the bank's board is split at 6-3 not to raise the interest rate to the requested 0.5%. While the bank of Japan's Governor, Toshihiko Fukui has agreed to monitor the general economic conditions for now the rate sites at the July 2006 set rate of 0.25%. When asked if the rate is too low the Governors simple answer was "Japanese interest rates might appear low, but aren't such low rates appropriate for an economy that has just emerged from a prolonged deflationary spiral?"

Here! Here! We real estate investors all agree whole heartedly.

There is no doubt that the Japanese economy is back says Daniel Citrin and Alexander Wolfson and working it's way upwards. Back in 2005 Japan saw a 3% growth as is stood the fastest growing economy within the group seven nations. @006 saw another healthy year and the outlook for 2007 is bright.

Real estate prices are soaring in pocket areas and creating a national average that looks, "promising" but does not reflect the true growth. Those of us looking to invest in prime locations in Japan today can easily testify to just how far off those national averages really are. As a simple yet very representative example we can look at a vacant black of land sitting in Hyogo that was on the market at 1.000.000 yen per Tsubo (one Tsubo 3.3 square meters) back in 2004. In November 2006 this same piece of land sold for 2.500.000 per Tsubo. Another less glamorous yet equally astounding example is a small block of 50 Tsubo purchased for investment back in 2004. This parcel was purchased at 100,000 yen per Tsubo. Today it has a value of 550,000 yen per Tsubo. That's a very nice return on investment and I must say a nice bit of change for the investors pocket.

With the interest rates holding now is the time to get in to your own real estate investment. It's also time to negotiate as hard as you can with the bank to fix that rate for as long as possible. Don't delay you can't fix a bank loan at 0.25% when the rate has gone up to 0.50%.  

All the best in your investing. Mark Smith.

P.S. If you would like to actually take a look at any of the pieces of land or investments described on this site drop us a line and we will be happy to drive genuine investors around the sites. It is our true desire to have more foreigners investing in their own real estate investments in Japan and the best way to learn is to actually get out and take a look. Be happy to show you around.