Japan’s Major Real Estate Firms Focus on Selling Single-Family Homes

The Yomiuri Shimbun

11:26 JST, March 22, 2026

Major real estate firms in Japan are strengthening their businesses focused on selling single-family home, aiming to capture demand customer needs for larger homes amid soaring real estate prices, particularly in urban areas.

With an increasing number of new condominium units with reduced floor areas, detached houses can easily maintain spaciousness by adopting two- or three-story designs. Companies are launching new businesses, such as establishing new brands and proposing floor plans using artificial intelligence.

New brand

On March 6, Sumitomo Realty & Development Co. showed the press its new showroom located in a building directly connected to Nihombashi Station in Chuo Ward, Tokyo. It promoted itself as providing comprehensive support for finding land for single-family homes, consulting services for building plans and financial planning.

In February, the company launched “City Garden,” a new brand that combines land sales with custom-built homes. The properties for sale are primarily located in areas with good transportation access to central Tokyo, Yokohama, Saitama and other urban centers, with each property located within a 5- to 15-minute walk from the nearest station.

Typically, detached homes are far from stations, but the brand emphasizes that its properties are just as convenient as condominiums. The brand’s first units are scheduled to be handed over to buyers this summer and the company aims to sell 300-400 units annually, mainly in the Tokyo metropolitan area.

“Detached houses can satisfy various customer demands by allowing them to secure ample space and design floor plans freely,” an official at the real estate company said.

Tokyo Tatemono Co., another major real estate company, plans to reenter the detached home business for the first time in about 10 years, aiming to start sales in 2027 and supply around 100 units annually.

In October 2025, Daiwa House Industry Co. launched an AI-powered service that proposes single-family homes from among over 2,000 plans based on customer’s requirement, such as size, number of rooms and budget.

Small plots of land

One of the reasons behind this trend is the shortage of suitable land for condominiums with a sufficient size and proximity to the station, making it difficult to supply more condo units. According to the Real Estate Economic Institute Co., the number of new condominium units supplied in the Tokyo metropolitan area in 2025 was 21,962, which is a 46% drop from 2015 and the lowest number since the survey began in 1973.

Due to the tight supply and demand, the average condo price climbed to ¥91.82 million in 2025, up 66% from a decade ago. To keep prices down, an increasing number of companies are reducing floor areas, causing the average exclusive floor area to shrink from 70.8 square meters in 2015 to 66.97 square meters in 2025. For families hoping to live in spacious homes, it has become difficult to find suitable condominiums.

On the other hand, the supply of small plots of land suitable for detached houses is expected to increase in the future because an aging population will lead to more people selling detached houses they inherited from their parents.

“In condominium development, it is necessary to secure multiple adjacent, small plots of land together, which takes time, but the single-family home business can immediately utilize such a plot,” said Yoshikazu Funakubo, a senior researcher at Mitsubishi UFJ Trust and Banking.