The government has decided to formulate a legal framework that requires the registration of buyers’ nationalities in transactions involving forests and large-scale land in addition to the land designated under the “Act on the Review and Regulation of the Use of Real Estate Surrounding Important Facilities and on Remote Territorial Islands” – including border islands and areas surrounding defense-related facilities. Moreover, in the case of transactions by corporate buyers, reporting of nationalities is required for both principal and other shareholders when foreign nationals hold a majority of the voting rights. The new act aims to ascertain the actual status of land transactions with foreign capital and to prevent the improper use of land.

Criticism of land acquisitions by foreign nationals has been growing. In particular, claims have been circulating about threats to water resources linked to foreign ownership of forests. But do these anxieties reflect the actual situation? According to a survey by Ministry of Agriculture, Forestry and Fisheries (MAFF), “The total area of forest acquired by foreign corporation, etc. in 2024 was 382 hectares, representing just 0.003% of Japan’s privately owned forest land. On a cumulative basis from 2006 onward, the total comes to only 10,396 hectares or 0.07%. No direct impacts on water resources have been identified.”
Incidentally, the report deliberately cites the U.S.’s figure of 5.0%, the share of foreign-owned forests, for comparison. Similarly, the Cabinet Secretariat stated on December 16 that there had been no reports of groundwater problems or conflicts with local residents attributable to groundwater extraction apparently by foreign individuals or entities.

Urban condominium transactions have also become the subject of criticism, with “speculative short-term trading” and “increase in non-resident ownership” frequently noted. According to the Ministry of Land, Infrastructure, Transport and Tourism, the share of foreign ownership of new condominiums in Tokyo was 1.5% in 2024 and rose to 3.0% in the first half of 2025, indicating a real increase. That said, these figures do not justify the claim that “Tokyo is being bought up.” Furthermore, with regard to short-term resales of newly built condominiums in Tokyo’s 23 wards in the first half of 2024, 7% of the transactions involved buyers “with addresses outside Japan,” whereas the share for those “with addresses in Japan” was 2.4 percentage points higher.

Foreign investors hold a large share of the luxury condominium market which is widely regarded as undervalued relative to global markets. Direct investment by foreign funds is also increasing in anticipation of inbound demand. Nevertheless, I can hardly agree that these factors provide a valid rationale for exclusionary claims. I have no objection to promoting transparency in land transactions and keeping track of the actual state of national land use. Rather, the focus should be on preventing illegal land use, such as the dumping of industrial waste, unauthorized private lodging, and development carried out without proper approval. At the same time, other important issues include controlling real-estate bubbles, protecting the residential environment, ensuring proper forest management, preserving watershed protection forests, and sustaining ecosystems. Above all, we need to start a serious discussion on designing policies that can effectively address these issues, rather than narrowing the debate to a single perspective centered on foreign nationals.

This Week’s Focus, December 14 -18, 2025
Takashi Mizukoshi, the President