Kyoto remains one of Japan’s most visited and culturally rich cities, making it a consistent hotbed for tourism and short-term rental demand. For real estate investors, understanding the best areas to buy and operate short-term rentals is key to long-term profitability. At Shiki Real Estate, we’ve helped clients successfully navigate the Kyoto market for years, and in this guide, we’ll walk you through the three key categories of neighborhoods—based on location, rental performance, and future growth potential.
Whether you’re a seasoned investor or exploring Kyoto real estate for the first time, this breakdown will help you target areas that align with your investment goals.
Prime Areas: High Demand, Premium Pricing
These neighborhoods are the epicenters of tourism in Kyoto, known globally for their proximity to iconic temples, historical landmarks, and picturesque streets. Properties in these areas tend to have the highest acquisition costs, but they also offer exceptionally high occupancy rates and rental income potential year-round.
🏯 Kiyomizu-dera Area (Higashiyama District)
Why this area is popular:
- One of the most visited spots in all of Kyoto
- Walking distance to Gion, Yasaka Shrine, and Kiyomizu Temple
- Streets lined with traditional architecture, ideal for machiya-style accommodations
Why it’s great for short-term rentals:
The area is constantly alive with tourists in search of an authentic Kyoto experience, making it one of the most desirable locations for short-term rentals. Owning a machiya here offers strong income potential, as properties can command premium nightly rates. While securing a property in such a competitive market can be challenging, it also reflects the area’s strong and stable value—land prices are unlikely to decrease, making this not only a high-revenue opportunity but also a relatively secure long-term investment.
🛕 Tanoji Area (Between Gion and Kiyomizu)
Why this area is popular
- Iconic for its historic charm and walkable alleys
- Easy access to shopping streets and traditional restaurants
- Located in Kyoto’s preservation zone with many licensed machiyas
Why it’s great for short-term rentals:
Tanoji strikes the perfect balance between tourist accessibility and Kyoto’s serene atmosphere. The area is in high demand for 365-day rental licenses and is well-known to international guests looking for culture-rich lodging.
Ideal For:
Buyers with higher budgets are often drawn to Kyoto’s most prestigious and well-established short-term rental zones, where properties consistently enjoy high occupancy rates and strong revenue potential. However, entry into these prime areas comes at a premium—property prices are high, and available inventory is limited, making opportunities both valuable and scarce.
Mid-Tier Areas: Balanced Investment with Growth Potential
These areas offer a great mix of accessibility, lower property prices, and steadily increasing tourist interest. While not as instantly recognizable as the prime zones, they are close enough to major attractions to perform well and are often where investors strike a balance between price and rental income. This is were we think people with comparative lower budget can invest, and the returns may be higher than in prime areas due to lower investment cost (price is about 60 mil~80 mil))
Some examples of this area are:
🏘️ Mibu Area
- Residential and peaceful, yet easily accessible to central Kyoto
- Just a few minutes from Shijo-Omiya and Nishioji Shijo stations
- Increasing popularity among local and foreign renters
🏯 Nijo Castle Area
- Home to UNESCO World Heritage site Nijo Castle
- Attractive for both tourists and longer-stay guests
- Close to downtown and Kyoto Imperial Palace
🚃 Omiya Station Area
- Well connected via Hankyu and Keifuku lines
- Offers more modern homes and apartments
- Slightly lower property prices compared to core tourist zones
🚄 North of Kujo (Minami Ward)
- Very close to Kyoto Station—convenient for travelers
- Properties are more affordable (with great accessibility due to it being close to kyoto station)
- Growing infrastructure, including new hotels and retail development
Why these areas are solid choices:
You’re not paying top-dollar for land, yet you’re still close enough to Kyoto’s cultural hotspots to attract short-term visitors—striking a sweet spot between cost and return. With tourism on the rise, demand is gradually expanding outward from the city center, making this area a smart investment while prices remain relatively moderate.
Ideal For:
Ideal for buyers seeking a balanced investment—where property prices are reasonable for the area and rental potential remains strong, making it a solid choice for long-term growth.
Why Work with Shiki Properties?
At Shiki Properties, we specialize in helping domestic and international buyers find, renovate, and manage short term rental properties throughout Kyoto. Our deep knowledge of Kyoto’s real estate market, short term rental licensing, and tourism trends allows us to guide investors to the right properties in the right locations.
Whether you’re looking to purchase a licensed machiya, explore new neighborhoods, or get support with property management, we’re here to support you at every step.
📩 Contact us today to start your Kyoto investment journey with a trusted local expert.