Japan’s housing starts fell 4.9% yoy in February 2026, worsening from a 0.4% decline in the previous month and slightly missing market expectations for a 4.7% drop. This marked the fourth straight month of contraction and the steepest decline since last November, pointing to sustained weakness in the property sector amid higher construction costs and soft demand. Declines were broad-based across all segments, including rental housing (-2.7% vs -1.5% in January), owner-occupied homes (-4.7% vs 6.6%), built-for-sale housing (-8.8% vs -4.8%), prefabricated housing (-2.2% vs 5.1%), and two-by-four homes (-7.7% vs 8.7%).

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