FX.co ★ Japan Housing Starts Unexpectedly Expand

In October 2025, Japan experienced a 3.2% increase in housing starts compared to the previous year. This unexpected rise defied market predictions of a 5.2% decline and marked a reversal from the 7.3% decrease seen in September. It was the first annual growth since March, propelled by recoveries in rented units, which increased by 4.2% against a prior drop of 8.2%. Additionally, built-for-sale homes surged by 14.8% compared to an earlier fall of 8.3%, and prefabricated housing rose by 9.2% from a previous decrease of 0.4%. Nevertheless, challenges remained in the sector of owned homes, which saw an 8.2% decline, worsening from September’s 5.6% drop. Issued units plunged by 36.3%, a significant downturn from a previous increase of 53.7%, and two-by-four homes shifted to a negative performance, decreasing by 3.8% following a 2.1% gain in the previous period.