FAQ / Answers to Your Questions

FAQ

Choose the category and browse through
the questions to find what you’re looking for.

BUY

General

What does “Deposit (Earnest Money)” mean?

You are normally required to put 5% - 10% of a sold house price as deposit when you sign the purchase agreement. This will be applied as a credit towards your down payment when you finally make it to closing and receive the keys. The seller must not cancel the deal once the deposit payment is processed unless due to your late payment etc.
Can I get my deposit (Upfront Payment) back if I cancelled the purchase agreement?

The deposit will not be returned to you if you cancel the purchase agreement. But only when you failed to obtain a mortgage and the mortgage contingency is included in the agreement, you will get the full amount of your deposit back. Also, if the seller cancels the agreement, you will get the doubled amount of your deposit.
How much cash do I need to prepare for buying a property?

10-20% of a sold house price will roughly be needed in cash, but it still depends on the property type, location, building age and structure, etc.
How long does it take to receive the keys after signing the purchase agreement?

In case of buying a property with mortgage, it roughly takes 1-1.5 months to do the final settlement after going through all the official procedure of a housing loan at the buyer’s bank. Whereas if all in cash it takes only about several weeks.
Is it possible to apply for a mortgage even if I don’t speak Japanese?

Most local banks are not foreigner friendly unfortunately. But we, HouseRep Tokyo, are partnered with SMBC Prestia who offers English support for foreigner clients and we together assist you in all procedure for getting a mortgage.
How is the maximum amount of mortgage I can borrow calculated?

It is calculated based on your income and the appraised value of the property.
- Maximum 100% of a sold house price in case of an applicant with a permanent residency.
- Maximum 80% of a sold house price in case of an applicant without a permanent residency.
However, the above % is all up to the bank’s assessment result and it depends on the property type, location, building age and structure, etc. of a property.
Is it possible to buy a property without a permanent residency?

It is, although the maximum mortgage amount varies depending on whether you have a permanent residency or not.
How do I apply for a permanent residency?

You can contact either Regional Immigration Services Bureau with jurisdiction over your place of residence, or the Immigration Information Center (Tel: 0570-013904) to apply for a permanent residency. There are some documents to gather, and also certain requirements stipulated by the government to meet. The approval process takes about 3-6 months and the handling fee is JPY 8,000. We, HouseRep Tokyo, put you in touch with the administrative scrivener who can help you in English.
Is it possible to cancel the purchase agreement if I fail to obtain a mortgage? Can I get my deposit back in such case?

You can cancel the purchase agreement and get your deposit back only when the purchase agreement includes a mortgage contingency as a special clause.
Am I eligible for home loan tax deduction as a foreigner?

Yes, as long as you file income tax and municipal tax.
Can I take out mortgage with my partner or family?

You can go with either joint mortgage (designed for married couple or family) or combined income mortgage. In case of joint mortgage, you and another party signs separate mortgage agreement and each is applicable to home loan tax deduction under certain conditions. In case of combined income mortgage, one party signs the mortgage agreement but you can combine your income with the other party’s, and the related expenses come for only one.
Can I do the signing all in English?

The original purchase agreement has to be executed in Japanese, but we will provide you with an English summary of all the clause stated in the agreement before you go under the contract.
How do I pay tax after purchasing the property? How much is it in general?

Real Estate Tax and City Planning Tax are always charged to the person who owns the property as of January 1st, and the buyer pays the prorated amount to the seller on the day of handing over, and also The Real Estate Acquisition Tax is charged once in the following year. In case of a property for investment, the Income Tax shall be charged at the time of your tax filing every year. Please check the estimation of buying cost here for detail.
What are the running costs of owning/maintaining the property?

It varies depending on the property type (house or apartment) but loan repayment, management fee and repair fund are required monthly, and a town community fee is often necessary to pay. Car/Bicycle parking, Trunk room (storage space outside the unit in the building), Internet Access, etc. may also be required separately.
In case of a house, such management fee, repair fund, or maintenance costs are not required, but of course some regular maintenance / repair works need to be arranged regularly by yourself.
What does house renovation process look like?

You arrange a renovation company to discuss your plan first, and if it’s an apartment, you need to give a notice to the building management organisation that you’re renovating the unit at least couple weeks before. And once you finally purchased your property, you can proceed to the actual renovation work. Some banks offer a housing loan that covers the renovation cost so earlier finalisation of the renovation plan would be ideal.
How do I know if the house sold price is fairly determined?

We provide you with the detailed market analysis and appraisal report (including purchase history, current market situation, yield, etc.) explaining as to how the price is determined.
Which International Schools do you recommend?

There are many good international schools in Tokyo, and each of them has its advantages for the location, education method/system, community, etc.. Please go to International School for detail.
Can I make payments by overseas bank transfer?

Yes, but the payments need to be confirmed by the seller by the hand-over date.
What are the necessary documents at the time of signing the purchase agreement?

Identification, Seal, Registration of Seal are required.
What is “Registration of Seal”?

In Japan, “Seal = Chop(challed Hanko in Japanese)” is still used for an important / official agreement instead of a signature. “Registration of Seal” is a certificate that proves it is your official Hanko and the copy of certificate can be issued at the ward office. You first need to buy the seal at Hanko store, and bring it to your ward office to register it.

SEE ALL QUESTIONS

Costs

How much is the initial cost for buying a property in Japan?

In general, 3-5% of the sales price in case of a brand-new property and 6-8% in case of a used property.
But it also depends on the property type (land, house, apartment), the seller type (corporate or personal), how you pay (all in cash or get a mortgage), and your circumstances (e.g., if you plan to renovate etc.).

SEE ALL QUESTIONS