Foreign residents looking to purchase property in Tokyo are facing an increasingly expensive market, with new data revealing record-high prices across both new and existing condominium sales. According to NHK, the average price for newly built condominiums in Tokyo's 23 wards reached 124.2 million yen (approximately $850,000 USD) in November 2024, representing a 14% increase compared to the same period last year. The surge isn't limited to new construction. The resale market has experienced even more dramatic growth, with the average price for used condominiums in Tokyo's 23 wards climbing to approximately 114.85 million yen in November—a staggering 34% year-on-year increase when standardized to 70 square meters of living space, NHK reported. In response to these escalating prices, the Japanese government has announced plans to expand access to home financing. The lending limit for Flat 35 (フラット35), a popular long-term fixed-rate mortgage program backed by the government, will be raised from the current 80 million yen to 120 million yen, according to NHK. This 50% increase in the borrowing ceiling aims to help potential buyers—including foreign residents with permanent residency or long-term visas—access properties in an increasingly expensive market. For expats considering homeownership in Tokyo, these developments present both challenges and opportunities. The price increases reflect several underlying factors, including limited housing supply in desirable central locations, historically low interest rates that have made borrowing attractive, and strong demand from both domestic and international buyers. Tokyo's status as a global business hub continues to drive competition for quality housing, particularly in well-connected neighborhoods. The expansion of Flat 35 lending limits could prove particularly relevant for foreign residents who meet eligibility requirements. Unlike some conventional mortgages that may be difficult for non-Japanese citizens to obtain, Flat 35 loans are available to foreign nationals who hold appropriate visa status, typically permanent residency or spouse visas. The program offers the security of fixed interest rates for the entire loan period, which can extend up to 35 years, protecting borrowers from future rate fluctuations. However, the increased lending capacity doesn't necessarily make homeownership more affordable—it simply makes higher-priced properties accessible to those who qualify. Prospective buyers should carefully consider whether stretching their budget to purchase at current price levels aligns with their long-term financial goals, especially given the substantial upfront costs associated with Japanese real estate transactions, including agent fees, taxes, and registration costs that can add 6-10% to the purchase price. For expats who aren't ready to purchase or prefer flexibility, the rental market remains a viable alternative, though rental prices in central Tokyo have also been rising. Those committed to buying should work with real estate agents experienced in assisting foreign buyers, as the process involves complex documentation and legal requirements that can be challenging to navigate without proper guidance. Financial experts recommend that foreign residents interested in purchasing property ensure they have stable, long-term employment in Japan and understand the implications of taking on a multi-decade mortgage commitment. It's also crucial to factor in ongoing costs such as management fees, property taxes, and potential major repairs, which can be substantial for condominium ownership. As Tokyo's housing market continues its upward trajectory, expats must weigh the benefits of property ownership against the significant financial commitment required in one of the world's most expensive real estate markets.