In our last edition of the Niseko brief, we outlined how newer developments are being put on the market at a higher price point indicating that Niseko’s real estate market is changing to accommodate a wealthier demographic. We concluded that Niseko is becoming more luxurious and will continue to be, based on the current and planned construction projects in the area. 

Colloquially known as the “Aspen of Asia”, Niseko’s dynamic local economy has worked hard to diversify its tourist industry beyond just snow sports. Given the roaring construction projects in and around the notorious Hokkaido resort, this year-round tourist boom is welcomed by developers new and old alike. 

A critical aspect of investing in emerging markets is the need to discriminate between short-term growth fads and sustainable development. As Paul Krugman famously discusses in his article, “The Myth of Asia’s Miracle,” it is often very easy to get caught up in aggregate GDP growth statistics without looking deeper into what is driving those statistics. This can lead to an investing-with-the-herd mentality and the systematic under-appreciation of some of the most interesting and lucrative opportunities across emerging markets.

China presents the “biggest beginner ski market in the world” according to the China Ski Industry White Book. Its burgeoning, affluent middle class is increasingly taken by Western fashions, such as skiing, which encourage a healthy, active lifestyle whilst acting as a mark of social class, much like in Europe.

Niseko – to the layperson it may not come to mind as easily as Chamonix, Aspen, or Val D’Isere when naming ski locations. But if you know snow, you must know Niseko.