Japan's property market appears to be roaring back to life, with sales of new condos rising to a six-year high and average prices reaching their highest annual level in two decades.

But a better barometer of the recovery is when the pickup in activity spreads to the condo resale market, says Yuichiro Kawaguchi, a real estate expert at Waseda University. The logic? While buying of new condos is often driven by the wealthy, demand for existing homes reflects a broader segment of the country's population.

Also, the buying of new homes last year was partially triggered by a rush to purchase before Japan's sales tax rises in April. Resales, however, are not affected by the tax increase and therefore better illustrate underlying consumer sentiment.

The second-hand market shows that the signs of recovery are still mixed. Average prices of used condos in Tokyo rose to the highest level since March 2012, but they're still 14% below a peak hit in January 2008 just before the global financial crisis hit, according to data provider Tokyo Kantei Co.