Chinese Tourists Flock To Japan In An Epic Tourism Boom
Updated: May 24, 2019
Of any town, Niseko has seen the highest growth, with Asian buyers especially hungry for the relaxing onesen experience, luxury shopping, and conveniently located ski-in ski-out properties.
What do the statistics tell us about investment? Why do Chinese tourists love Japan and Hokkaido region? What is it about this particular area that has inspired such a surge in visitor numbers and investment in recent years?
Read on to find out.
Chinese Tourists In Japan- The Official Figures
Despite continuing disputes over the Senkaku Islands, there has been a steady increase in tourism from China to Japan in recent years.
In 2015, Japan announced it would lower the income threshold for Chinese tourists applying for a multi-entry visa, as well as extend the validity of the visas to encourage travel – and the numbers of Chinese tourists sky-rocketed almost immediately!
In fact, when you take a look at the numbers the results are startling; Chinese tourist numbers rose from 1.7 million in 2013, to 7.4 million in 2017. With almost 28 million international arrivals each year, over 25 percent of those numbers come from China alone.
Why do Chinese tourists love Japan?
Historically, then yen has been weak against the yuan meaning that Chinese can travel remarkably cheaply compared to other destinations in Australia and Europe.
Among the higher-income Chinese tourist, luxury shopping is a big draw to travel abroad too. China has had issues in the past with importing such goods and with heavy taxation on them, it makes sense to head to the nearby hub of Japan for all their luxury items.
Chinese and Japanese airlines have been increasing the frequency and numbers of destinations that they travel to too. For instance, Shanghai Airlines and China Eastern fly to 16 points in Japan from 9 Chinese cities. With rising numbers of visitors, it’s not unusual to experience flights full of Chinese when heading to any of their favourite hotspots.
Why do Chinese tourists love Niseko?
Over the last three years, 58 percent of Chinese travelers took a snow holiday in Japan. Tourism numbers show that the largest market among Chinese tourists are among the millennial generation. In fact, China is home to 400 million millennials, and 2/3rds of passport holders in China are among the millennial generation.
In the next few years, they will start to hit peak earnings and adrenaline sports such as skiing or snowboarding are increasingly fashionable as a vacation of choice.
Niseko makes sense as a first choice; voted consistently as one of the best places to ski in world. The snow is fluffy and dry, and most importantly, dependable (unlike it’s nearby counterparts in South Korea). Niseko is home to more than 9 metres of snow each year, which is more than other popular destinations such as Aspen, Vail or Whistler.
Often likened to the ‘Aspen of Asia’ Niseko is becoming more and more popular for those looking for luxury too. Home to an increasing number of luxury stores, condos, and ski-in-ski-out apartments – it’s the ideal holiday destination for the up and coming Chinese ski tourist.
This is evidenced by data from online travel agencies like Lvmama who during the Christmas and New Year travel period saw increased searches for “winter getaways,” “ice and snow tours,” and “hot springs” with many of those tourists heading for Hokkaido. Indeed, over 660,000 mainland Chinese tourists in 2018 visited the Hokkaido region.
Chinese Invest in Japan
It follows that with increasing numbers of visitors to Japan each year, that Chinese investment is growing too. With more people travelling to Japan, they begin to think about buying a flat or apartment and renting it out. Financially, it makes sense to do so.
Plus, Japan’s upcoming 2020 Olympics, recovering economy since 2012, and Japanese freehold available to foreigners all helping to drive this steady increase in investment.
Back in 2013 not long after property investment really began to take-off in Japan, yields in Tokyo were about 5 to 6 percent compared to 2 or 3 percent in Taiwan and Hong Kong respectively.
And investment has continued to rise since then. Of the major cities, Tokyo, Osaka, Nagoya, Sapporo, Kanto, Hokuriku, Hiroshima and Fukuoka hold the highest number of condominium developments, with the average price in Greater Tokyo up from 59,000,000 JPY in 2017, and in Osaka, down from 40,000,000 JPY.
Chinese Investment in Niseko
Recently, Japan’s northern province of Hokkaido has become a top choice for foreign investment the world over.
The new Chitose Airport in Hokkaido, which serves Niseko, became the world’s first WeChat Pay (the Chinese social and mobile payment app) flagship airport in December 2017. Additionally, over 500 merchants and more than 2,000 shops across Hokkaido also accepted WeChat Pay.
Chinese tourists generally demand a higher level of comfort and service than their Australian and European counterparts which has led to an increase in the number of luxury investments in Niseko.
Now, Hong Kong and Singapore buyers account for 70 to 80 percent of condominium and land purchases, with interest emerging from Malaysia and mainland China.
As well as setting aggressive targets for foreign visitor numbers, across Japan, the government has been promoting the purchase and development of property by foreigners.
With freeholding rights and lending from Japanese available to foreigners, there are numerous opportunities for Chinese buyers to invest in the Japanese property market.
In Niseko, government involvement has played a significant role in promoting outside visitors and investment in the area. For Lunar New Year, the municipal government worked with retailers to offer special discounts to Chinese travelers.
Heated roads, paths, and Shinkansen service between Tokyo and Hokkaido make up just some of their investments.
Billionaires across Asia are flocking to this attractive resort, with some notable investment from leading property investors.
With Richard Li’s Pacific Century Premium Developments is one such example, set to open Park Hyatt this year; developments of condos which are priced between $900,000 and $10 million.
JNW properties based in Hong Kong is redeveloping much loved Raku Ichi as a luxury restaurant and apartment complex. The building that currently exists will be demolished and its place, a 14 plot apartment condominium and restaurant will be constructed on the 3300sqm site. The building will still have a Japanese kominka style and is estimated to cost several million US dollars.
Hong Kong-based The Pavilions, a hotels and resorts company, bought a large parcel of land in Hirafu, the main village in the Niseko region. The company is building the 40-room The Pavilions Niseko hotel, scheduled for completion in 2019, and The Ginto Residences, a development of 31 private villas.
What Does This Increase In Chinese Tourism Mean For Hokkaido in the future
Ross Findlay, managing director of the Niseko Adventure Center, described Asia as “an awakening market” that would account for an increasing number of visitors. “As a ski market it’s something that is just going to get bigger and bigger because more and more people are having the finances to be able to come for a ski holiday and are keen to do it,” Findlay said.
By 2020, Hokkaido expects over international tourists throughout the year, and China is expected to account for 1.5 million of them. That would be an almost 150 percent increase in just two years.
The future of Niseko is an exciting one, and soon will rival some the biggest and best ski resorts in the world for both snowfall and resort development.
The Chinese tourism market to Japan is increasing rapidly, and investment along with it. Nowhere is this more in evidence than in the Hokkaido region. Niseko is witnessing an influx of foreign visitors and investors and it has a promising future in the opportunities for property investment.
Please get in contact with us if you would like to know more about investment opportunities through Snow Dog Village properties.