Tower condominium investment is a popular real estate investment that attracts attention for its high asset value and social status.

However, investment professionals are also paying close attention to future trends, such as the tax system being revised due to the large number of investments made with the aim of reducing taxes, and judgments adding new interpretations to property valuation notices. Masu.

This time, we will introduce the advantages and disadvantages of Towerman investment, and points to note when considering investment.

Characteristics of tower condominium investment (Towerman Investment)

There is no legal definition of a "tower condominium."

However, in the fixed asset tax system, there is a category called "Residential High-rise Buildings," which applies to buildings over 60 meters in height. High-rise condominiums with more than 20 floors are generally called tower condominiums.

Towerman Investment owns one-unit condominiums in sections, similar to studio apartments, but there are major differences in price, location, and target group of tenants.
Tawaman's prices are higher than surrounding properties with the same floor area. Furthermore, even for the same condominium and same floor area, higher floors are more expensive, and in some cases the price difference between lower and upper floors is more than 1.5 times.

In addition, since Towerman buildings are often planned in conjunction with redevelopment in front of stations, most properties are located in prime locations in the center of downtown areas near stations.

Recently, there has been an increase in the number of terminal stations being built in the suburbs, but if you are thinking about it as an investment, you will probably want to consider properties in prime locations in the city center or regional core cities.

For this reason, most of the tenants are wealthy people, and there are properties in Zara where the rent can be in the hundreds of thousands of yen.
If you do not select a property based on these characteristics of Towerman Investment, you will be exposed to unexpected investment risks.

Advantages of Towerman Investment

The number of building plans for Tawaman is increasing year by year, but the number of condominiums as a whole is not that large.

Properties that are managed on a rental basis are particularly rare.

Many people seem to invest in Towerman because of its unique value that is not found in other real estate investments.

We can provide value that only Towerman can provide.

The best part of real estate investment is thinking about what value you will provide to tenants.

In this respect, Tawaman has a prime location, convenience, views, and sunlight. In addition to the value of the property itself, which is a wealth of common facilities, it can provide unique values such as glamor and social status.

Because of this value, we are able to set a more aggressive rent than surrounding properties.

Asset values are unlikely to decline

The locations where Tower Man can be built are limited by height restrictions and floor area ratio restrictions in urban planning. It can be said that it is a highly rare building.

In addition, in addition to the high quality of the frame, building materials, and attached equipment, the building is built in harmony with the surrounding architectural plans, so the exterior design is top-notch, so the asset value is unlikely to decline. You can say that. The value of popular tower condominiums does not decline even after years of construction, and on the contrary, there are even some that have seen their market prices rise. Therefore, there are many cases where investors invest in Tower Man with the aim of capital gains.

Disadvantages of Towerman Investment

Although Tower Man has a high asset value, it also requires considerable maintenance costs in addition to the initial cost.

Also, since the target of tenants will be narrowed down to a certain extent, it will be necessary to pay close attention to vacancy risk.

Management and repair costs are high

Tawaman has a variety of common facilities, including garbage disposal facilities on each floor, high-rise elevators, meeting spaces, and fitness facilities.

Cleaning is done by hanging gondolas, and there are many facilities unique to Tawaman when it comes to updating equipment. Because of this maintenance cost, management fees, repair costs, and repair reserve funds are higher than those for ordinary condominiums.

It would be nice if everything could be paid by the tenant, but considering the competitiveness with surrounding condominiums, it would be difficult.

Vacancy risk is relatively high

Since the acquisition price of Tawaman is higher than surrounding condominiums, the rent needs to be set higher as well.

Therefore, in Towerman, which has a relatively large floor space, once a vacancy occurs, it may be difficult to find a new tenant.

During that time, you will have to pay the principal and interest on the loan, advertising costs for recruiting tenants, management costs, and repair costs without having any income, so you will need to plan with plenty of cash flow.

Tips and precautions when choosing a Towerman investment property

With Towerman Investment, the investment amount per unit tends to be high, and it requires considerable financial strength to own several units and make diversified investments.

In addition, when considering investment, it is necessary to consider the investment risks specific to Towerman, so it can be said that it is an investment for somewhat advanced users.

Be sure to choose your property carefully and create a business plan with sufficient funds.

Check out the popularity and price at the time of sale.

When considering Towerman, it is important to consider whether the asset value will be maintained in the future.

If you investigate how popular the property was when it was sold, and how much difference there is between the price at the time of sale and the current price, you can use it to predict whether the property value will be less likely to decline in the future. Sho.

If prices seem to be falling, try to find out why. There may be various reasons for this, such as the area becoming less popular, repair costs rising due to damage such as flooding, or a forest of tower mans nearby, but even if you see these signs. It is better to refrain from investing.

Plan your business carefully

Towerman has a high investment amount and high rent, but on the other hand, the cash out when the property is vacant is also large. Therefore, it is necessary to take a very serious look at the vacancy rate and surplus funds when making a business plan.

Comparing a 100 million yen Towerman unit and an apartment building, the risk of vacancy is dispersed in an apartment, whereas in a Towerman, if a vacancy occurs, the rental income will be zero until the next move-in. Masu.

It's fine if you have enough cash on hand, but you will need to carefully consider whether Tower Man is an investment target that still has an advantage when compared to investing in several studio apartments or apartments.

Be careful when investing in Tower Man for tax saving measures.

It seems that there are many wealthy people who consider tower investment to save on inheritance tax.

Indeed, with Towerman Investment, the inheritance tax assessed value of the land and building is lower than the investment amount, and various special provisions for devaluation are available, so it can be used for inheritance tax measures.

However, tax reforms have been made to change the method of calculating fixed asset tax assessments (inheritance tax assessments for buildings), and excessive inheritance tax savings have been denied due to Supreme Court rulings regarding property assessment notifications. There is a growing focus on tax savings.

It is important to consider properties from the perspective of whether or not you can expect a sufficient return on investment through income gains and capital gains.

Invest in Tower Man after careful consideration.

Towerman Investment has an appeal that cannot be found in other real estate investments, and while it has high investment effects such as the possibility of capital gains, it also has a relatively high investment risk.

When creating a business plan, you will need to factor in the risk of vacancies and sudden expenditures and create a business plan with plenty of leeway.

Even if you see a property that you think is good, it is important not to jump in immediately, but rather to compare it with other real estate investments such as apartments and regular condominiums, and then make a careful decision.