On the 21st, the Real Estate Distribution Research Institute Co., Ltd. announced the results of the "Real Estate Distribution Companies' Intermediation Performance Survey" for the first half of fiscal year 2023. This survey is conducted biannually to explore trends in the real estate distribution industry. Questionnaires were sent to major real estate distribution companies, and responses were received from 23 companies (see the list below).
Among the 23 companies, 14 increased their handling fees. However, only three of them achieved a double-digit increase. Companies with a decrease in the number of transactions amounted to 14, and comments suggested that demand in suburban areas has started to stabilize.
Mitsui Fudosan Realty Group, the top performer, maintained its handling fee income at the same level as the previous year, supported by the rise in transaction unit prices in urban areas and strong demand, despite a decrease in the number of transactions. Tokyu Livable, ranked second, struggled in the April-June period but was boosted by strong demand and price increases in urban areas during July-September, stating that homes were quickly sold at high prices once listed. Sumitomo Realty & Development Sales, ranked third, experienced a decrease in the number of transactions due in part to adjustments in store placement.
Many companies benefited from the current period of price increases. In urban areas where prices continue to rise, demand from affluent and investor classes remains active. Due to the soaring prices of new condominiums, demand is shifting towards existing condominiums with more reasonable prices. Companies anticipate continued prosperity in urban areas, believing that users currently active in the city are not affected by fluctuations in housing loan interest rates and that the thriving conditions will persist for a while.
Concerns were raised about changes in the market dynamics in suburban areas, particularly in the field of individual mediation. While real demand-driven needs have weakened due to rising prices, sellers are inclined to aim for high-value sales, leading to a trend of prolonged contract periods. Companies reported an increase in sales consultations, but sellers' price perspectives remained high. On the other hand, there is a decrease in purchase intentions, and inventory is increasing. In suburban areas, there is a surplus of new single-family homes, leading to a decline in market prices, according to various companies expressing concerns, such as Keio Real Estate Co., Ltd. stating, "There is an increase in unsold new detached houses, leading to a decrease in market prices," and Odakyu Real Estate Co., Ltd. stating, "A slowdown in the market is observed, with a decrease in purchase information, returning to levels before COVID-19."
Regarding corporate mediation, Mitsubishi Jisho Real Estate Services Co., Ltd. saw an approximately 60% increase in handling fee income, and Nomura Real Estate Solutions also experienced an increase in handling fee income, the number of transactions, and handling volume, showing overall positive performance.
For the second half, many companies believe that the key will be price increases. Yuichi Ota, President and CEO of Tokyu Livable, warns that if price increases go too far, buyer activity may sharply decline, emphasizing the importance of maintaining a situation where high prices can be sustained moderately.
The 2023 first-half intermediary performance of major real estate distribution companies.
※The commission income of Mitsui Fudosan Realty Group includes revenue from the brokerage segment, encompassing sales intermediation, rental intermediation, and rental management income. Tokyu Livable's commission income comprises rental intermediation and related rental revenue. Sumitomo Real Estate Sales and Mitsubishi Jisho Housenet's commission income includes rental intermediation. Tokyo Tatemono Real Estate Sales and Sumitomo Forestry Home Service report figures for the first half of the fiscal year ending December 2023, while Sekisui House Group reports for the first half of the fiscal year ending January 2024. Other companies report figures for the first half of the fiscal year ending March 2024. Changes are expressed as year-on-year comparisons.
Reprinted from: Real Estate Distribution Research Institute Co., Ltd. “R.E.port”
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