Faced with a steadily declining population, the remote town of Yuni on Japan's northernmost island of Hokkaido is set to start selling land for 120 yen per square metre, hoping to lure a few new residents.

The population of Yuni, some 800 km north of Tokyo, is now at about 5,900 but is falling by 100 people a year, a town official said.

"This plan is designed to stop the declining population," he added, emphasizing the town's unique charms - Japan's largest herb garden and a hot springs resort where unusual black water gushes out.

The 120 yen price was set to commemorate the 120th anniversary of the town's founding, he added.

The price is a steal in land-poor Japan, especially for stressed residents of Tokyo, where a square metre of land averages 309,000 yen.

Purchasers will be chosen by lottery, with applications accepted through the end of August. There have already been 160 to 170 enquiries.

Yuni's situation reflects the aging of Japan as a whole, with a national population set to fall 32.1 percent by 2060 from 2011 levels. By then, 40 percent of the country will be over 65.

City officials have attached several requirements for prospective buyers, including that they must either be Japanese or have a permanent residence visa and agree to build a house on the land within three years and live there. (Reporting by Teppei Kasai, editing by Elaine Lies)

• A Permanent Economic Emergency