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Expat Exchange - How to Buy a Home in Japan
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How to Buy a Home in Japan

By Joshua Wood, LPC

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Summary: The one tip that you hear expats living in Japan repeatedly sharing with newcomers is not to buy a home when you first move to Japan. Rent for a few months or longer so that you have time to find the right neighborhood. Give yourself time to ensure that Japan is right for you for the long term. If you've already taken time to do those things and are ready to take the plunge and become a property owner, here are tips about buying a home in Japan.

Japan, with its rich culture, advanced technology, and beautiful landscapes, is an attractive destination for many expats. However, buying a home in Japan can be a complex process, especially for foreigners. This guide aims to provide a comprehensive overview of the process, from finding houses for sale to understanding the legal requirements and potential pitfalls. Whether you're planning to settle in the bustling city of Tokyo or the serene countryside, this guide will help you navigate the Japanese real estate market with ease.

How Do I Find Houses for Sale in Japan?

There are several online platforms and real estate agencies that list properties for sale in Japan. Websites like Suumo, Homes, and Realestate.co.jp are popular among foreigners as they offer English language options. Local newspapers and real estate magazines also list properties for sale. It's advisable to engage a real estate agent who can guide you through the process and negotiate on your behalf.

Are There Restrictions on Foreigners Owning Property in Japan?

Unlike many countries, Japan has no restrictions on foreigners owning property, regardless of their visa status. You don't need to be a resident or have a specific type of visa to buy a home. However, while there are no legal restrictions, foreigners may face challenges in securing a mortgage from Japanese banks. Some banks may require a permanent residency status or a guarantor who is a Japanese citizen.

Does Japan Have an MLS Type System?

Japan does not have a Multiple Listing Service (MLS) like in the United States. Instead, each real estate agency has its own listings. This means you may need to work with multiple agents to see a wide range of properties. However, some online platforms aggregate listings from various agencies, making it easier to search for properties.

Do Brokers Have Licenses and How Do I Know if They are Licensed?

Yes, real estate brokers in Japan are required to have a license issued by the Minister of Land, Infrastructure, Transport, and Tourism. You can verify a broker's license by checking their registration number on the Ministry's website. It's important to work with a licensed broker to ensure a smooth and legal transaction.

What Documents are Required When Buying a Home?

When buying a home in Japan, you'll need to provide several documents, including your passport, visa, a certificate of eligibility for residence, and a personal seal (inkan). If you're applying for a mortgage, you'll also need proof of income and tax payment certificates. The property itself will require a property registration certificate and a property tax payment certificate.

Do I Need a Lawyer When Buying a Home in Japan?

While it's not mandatory to have a lawyer when buying a home in Japan, it's highly recommended, especially for foreigners. A lawyer can help you understand the legal terms and conditions, review contracts, and ensure a smooth transaction. Legal fees can vary, but you can expect to pay around 200,000 to 300,000 yen.

Do People Typically Buy a Property with All Cash or Take Out a Mortgage?

Both options are common in Japan. However, as a foreigner, securing a mortgage can be challenging. Some banks may require a permanent residency status or a Japanese guarantor. If you're able to pay in cash, it can simplify the process and potentially give you a stronger negotiating position.

Are There Inspections That Take Place, and If So What is That Process Like?

Yes, property inspections are common in Japan. They are typically conducted by a third-party inspector who checks the property's condition, including the structure, plumbing, and electrical systems. The inspector will provide a detailed report, which can be used to negotiate the price or request repairs.

What Are Some of the Pitfalls to Avoid When Buying Property in Japan?

One common pitfall is not fully understanding the terms and conditions of the contract. It's crucial to have a lawyer or a trusted advisor who can explain the details. Other pitfalls include not thoroughly inspecting the property, not considering the location and accessibility, and not factoring in ongoing costs like property taxes and maintenance fees. It's also important to be aware of the challenges in securing a mortgage as a foreigner.

Expats Talk about Real Estate in Japan

"Think small. A lot of American furniture won't fit in the pats here. I would come with my important papers & luggage. get your place then shop & have furniture delivered. Or by used from craigslist or recycle or 2nd hand stores. There are plenty! There are food places all over mexican, Italian, Indian, Outback, TGIF,. I'm an hour from Tokyo. It's easy to find food places you like. Average meal 10-12.00 to eat out, train ride 6-8.00 each way to Tokyo. Plus size clothes are very rare to find. If you a small person you will find your size clothes," said one expat living in Kanagawa Perfecture.

About the Author

Joshua Wood Joshua Wood, LPC joined Expat Exchange in 2000 and serves as one of its Co-Presidents. He is also one of the Founders of Digital Nomad Exchange. Prior to Expat Exchange, Joshua worked for NBC Cable (MSNBC and CNBC Primetime). Joshua has a BA from Syracuse and a Master's in Clinical and Counseling Psychology from Fairleigh Dickinson University. Mr. Wood is also a licensed counselor and psychotherapist.

Some of Joshua's articles include Pros and Cons of Living in Portugal, 10 Best Places to Live in Ireland and Pros and Cons of Living in Uruguay. Connect with Joshua on LinkedIn.


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