Japan Sheds 916,744 Residents in a Year as Foreign Residents Top Four Million

Japan lost 916,744 Japanese residents in a year and gained 353,696 foreign residents. Where those two lines cross decides whether the apartment you buy in Japan can still be rented a decade from now.

By the resident registry, as of 1 January 2026 Japan's Japanese population stood at 119,736,483, down for a seventeenth consecutive year, with both the decline and the rate of decline the largest since the survey began in 1968. Foreign residents reached a record 4,031,159, up 9.62% and above four million for the first time. Toyo Keizai's ranking of municipalities where Japanese numbers fall while foreign numbers rise puts Kawaguchi in Saitama fifth and Kyoto fourth.

The ranking matters less than the difference in speed. The Japanese decline is a slow seventeen-year trend; foreign growth is close to ten percent a year. In certain municipalities the resident mix will turn over within five to ten years, while schools, clinics and public services are still sized for the old one.

Three paths: concentration into a handful of cities and their industrial suburbs, which supports rents but raises management costs; a tightening of residence-status policy, which is the single largest risk to this investment case; or local governments actively courting new residents, which only works where jobs already exist.

When selecting a rental asset, do not screen for a high foreign share. Screen for a rising foreign share alongside a shallow Japanese decline. The first is demand; the second says the underlying base is still there.