Japan is one of the few countries that permits foreigners to buy real estate without restrictions, regardless of residence status. This makes the country an attractive destination for investors, expatriates, and enthusiasts of Japanese culture who wish to own property.
However, buying a property in Japan involves bureaucratic processes, specific taxes, and challenges such as language barriers and difficulties in obtaining financing. In this guide, we explain how foreigners can purchase property in Japan, what costs are involved, and how to ensure a secure investment.
Read also: Are Japanese houses really small?
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Can Foreigners Buy Real Estate in Japan?
Yes! Unlike many Asian countries that impose restrictions on foreign buyers, Japan does not require citizenship or residency visa for property acquisition. Foreigners can buy apartments, houses, and land without limitations, and the property can be ed in their name.
However, there is an important detail: owning property in Japan does not guarantee a residence or citizenship visa. Buying property does not facilitate immigration processes, so it is necessary to have an appropriate visa if you want to live in the country.
Step by Step to Buy a Property in Japan
1. Choose the Type of Property
In Japan, properties can be classified into different categories, and each of them has advantages and disadvantages:
- Apartments (Manshon) – Modern buildings with good appreciation, but they may have high maintenance fees.
- Individual Houses (Ikkenya) – More spacious properties, but with lower long-term appreciation.
- Land – They allow for the construction of a custom house, but require more bureaucracy.
- Commercial Real Estate – Good options for those looking to start a business or invest in the real estate sector.
If the idea is for an investment, cities like Tokyo, Osaka, and Kyoto offer better opportunities for appreciation and rental demand.
2. Define the Budget and Check the Funding
The value of real estate in Japan varies depending on the city, location, and type of property. On average:
- Small apartments in Tokyo: ¥40,000,000 to ¥80,000,000 ($270,000 to $550,000).
- Houses in residential neighborhoods: ¥50,000,000 to ¥150,000,000 ($330,000 to $1,000,000).
- Properties in the countryside: Starting from ¥10,000,000 ($70,000).
Payments are usually made in cash, as obtaining a bank financing as a foreigner is extremely difficult without permanent residency or a long-term visa. Some banks offer mortgage loans to foreigners, but they require proof of income in Japan.
3. Hire a Realtor and Conduct Property Research
To facilitate the process, it is ideal to have the assistance of a real estate agent (Fudousan), who can help with the search and negotiation. Some real estate agencies that cater to foreigners include:
- Sotheby’s International Realty Japan
- Plaza Homes
- Real Estate Japan
When finding a property of interest, check details such as building age, condition, accessibility, and maintenance fees.
4. Make an Offer and Sign the Purchase Agreement
Once the property is chosen, the next step is to make a formal offer to the seller. If accepted, a purchase contract will be prepared, and it will be necessary to pay a deposit (shokikin) of 5% to 10% of the total amount.
The contract will include details such as deadlines, taxes, and the buyer's obligations. It is advisable to hire a lawyer to review the before g.
5. Property Registration and Final Payment
After g, the process of transferring the property to the buyer's name is carried out at the Real Estate Registration Office in Japan. At this time, it will be necessary to pay the remaining amount for the property and the required fees.
The buyer will receive a document called "Toukibo" (Certificate of Property), confirming that the property has been transferred legally.
What Are the Costs and Taxes When Buying a Property in Japan?
In addition to the property price, there are additional costs that can represent between 6% and 10% of the total value. The main ones are:
- Property Acquisition Tax: 3% to 4% of the recorded value of the property.
- Registration Fee: 0.1% to 2% on the property price.
- Broker Fees: About 3% of the property's value + ¥60,000 ($400).
- Annual Property Tax: 1.4% per year on the ed value of the property.
- Home Insurance (optional): Typically costs ¥20,000 to ¥50,000 ($135 to $350) per year.
It is essential to plan these costs before completing the purchase to avoid financial surprises.
Tips for Safely Buying Property in Japan
Buying property in Japan can be a smooth process as long as certain precautions are taken:
- Consider new or well-maintained properties: Old properties can lose value quickly and may require expensive renovations.
- Check the documentation and history of the property: Some properties may have associated debts or structural issues.
- Prefer areas with good infrastructure and transportation: This ensures greater value and ease of resale or rental.
- Avoid unknown intermediaries: Always choose ed real estate agencies and brokers.
- If possible, visit the property before buying: This avoids unpleasant surprises after the purchase.
Conclusion
Buying property in Japan is an accessible process for foreigners, with no restrictions regarding nationality. However, it requires financial planning and knowledge of the costs and bureaucracies involved.
Whether for personal residence or investment, the Japanese real estate market offers interesting opportunities, especially in major cities like Tokyo, Osaka, and Kyoto. With the right preparation and professional assistance, it is possible to acquire a property safely and take advantage of the benefits of owning property in Japan.
If you are planning to buy a property in Japan, follow this guide and take the first step to make that dream come true!
