Niseko property market reveals dynamic recovery and growth trend

Image source: Hanazono Resort

The deep-rooted connection between Asia’s leading alpine resort destination Niseko’s tourism and real estate markets is truly a symbiotic relationship. Both remain integral to each other’s success and the lines continue to be blurred in the post-pandemic world.

Niseko only truly re-emerged from COVID-19 travel restrictions that Japan imposed in October 2022. What is important to understand about tourism is that Japanese travellers have always made up a significant part of the tourism picture, especially in the summer months of July and August. But during the pandemic period, the Japanese actually re-discovered the winter ski season and were strong contributors to the local economy.

With the destination now returning to 2019 visitor numbers, C9 Hotelworks’ new Niseko Tourism and Property Market Review shows that 2023 year-to-date figures are already up by 64 percent with 2.6 million arrivals. C9’s forecast reveals a complete recovery within the next year, and a strong base to grow from.

Some of the leading market trends follow the lines of market maturation and segmenting areas.

Hirafu and what we term Outer Hirafu is continuing to see more developments, especially in luxury condominiums. Two top-of-the-town ski-in, ski-out projects in Upper Hirafu is the upcoming Hoshinoya Hutte Niseko and soon-to-open Muwa.

What is happening in Hirafu now is that property development is spreading on the edges of the area and pushing outward as can be seen by the upcoming Six Senses Niseko and the recently launched Hotel 101 projects, which both pair branded residences and hospitality. We expect a further push of the prime Lower Hirafu Village area to further extend given strong Mount Yotei views and proximity to the scenic Shiribetsu River. It’s likely these peripheral areas will see more luxury villa development.

Going deeper into the condominium sector. Hirafu remains the key area for these type of projects, though according to our research sales pace/absorption has slowed as buyers have sifted preferences to custom resort detached homes. Casting an eye further to Niseko Village and Annupuri, demand for condominiums is under the market average.

Perhaps the biggest story is Hanazono and how this catchment area is developing into a premium luxury district. Coming this high season will see the successful Park Hyatt Hotel and Residences bring 13 ultra villas into the property marketplace with eye-popping prices. These are designed by noted Japanese designer Kengo Kuma and interiors by Adrian Fu. On the nearby links are 30 resort homes that are golf-oriented properties.

Near to the Hyatt is the new 234-room Nikko Style Hotel set to open next year. Meanwhile, on the outer edges are a number of luxury housing estates – Hana Ridge, Kaba, and the mixed-use Odin Hills and Hana Creek. Luxury loves company and Hanazono is on an upward trajectory, spurred but new investments into its main gondola, world-class 1.3 kilometer summer and winter zipline attraction and further infrastructure upgrades.

Image source: Hanazono Resort

Niseko’s real estate sector is closely looking at how transactions shake out in its first full winter post-pandemic season and whether there are changes in location unit types or choices between homes or condominiums. With broad condominium pricing now close to USD15,000 per square metre, one possible positive is that the declining Japanese Yen will spur currency bargain hunters.

On the flip side, construction costs continue to escalate, labour shortages push hotel and rental prices up, and there is a potential two-year delay in the high-speed railway (Shinkansen) to nearby Kutchen. There still remains a historical hangover of businesses that close in some or part of summer, making it hard for a destination to be truly all-season and hopefully with more hotel brands coming this will spark a change.

Image source: Hanazono Resort

Overall, the continued development profile of Niseko and its changing geography is impressive in terms of premium luxury development and there continues to be a healthy level of buying appetite for some of Asia’s most expensive leisure properties.

With an after COVID-19 traveller mind-shift to outdoor sports including golf, skiing, and mountain biking, it doesn’t get any better than Niseko for these types of activities. It is all about lifestyle for now and I cannot find a better match across the region for this type of natural attraction.

For further insights, check out C9 Hotelworks’ latest Niseko Tourism and Property Market Review.

About Bill Barnett

Bill Barnett — a globally recognised hospitality, tourism, and real estate advisor — is the founder and managing director of Asia-based C9 Hotelworks and esteemed member of the PropertyGuru Asia Property Awards (Greater Niseko) Judging Panel.

In addition to being a leading consultant, he is a frequent speaker at industry events and conferences.  With over 30 years’ experience in the Asia Pacific region, he has an extensive background in hotel operations, development, and asset management. His past employment highlights include Senior Corporate roles at international hotel chains and publically listed companies. Bill is considered to be one of the foremost industry experts in the hotel residences sector.  To date, Bill is the author of four books on travel, property, and hospitality under the titles of Slave to the Bean, Collective Swag, It Might Get Weird and Last Call. 

For more information, email: [email protected].