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Japan’s housing starts dropped 29.3% year-on-year in March 2026, a sharp deterioration from February’s 4.9% decline and weaker than market forecasts of a 28.5% fall. This was the fifth consecutive monthly contraction and the steepest drop since May 2025, underscoring ongoing fragility in the property sector amid elevated construction costs and subdued demand.
The downturn was broad-based across all major categories: rental housing slumped 35.2% (vs -2.7% in February), owner-occupied homes fell 27.4% (vs -4.7%), built-for-sale housing declined 21.7% (vs -8.8%), prefabricated housing slid 4.7% (vs -2.2%), and two-by-four homes plunged 28.4% (vs -7.7%).
