Starting April 1st, 2018, the real estate industry is introducing a new licensing system for home inspectors. This change is aimed at increasing the safety of second hand home purchases.
Currently, the trend for home buyers is to purchase brand new due to the perceived safety of buying from a reputable developer instead of an individual.
While markets like central Tokyo have thriving second hand market, other regions in the country do not which is where this change is aimed at improving.
A home inspection currently is performed by a third party firm that assess the structural elements of the property and makes reports on what needs to be fixed, what could be potential trouble spots with the property and recommendations on how and when these issues should be resolved.
One of the things that made Japan real estate separate from other G7 nations was the lack of home inspections as part of the sales process. As it stands, a lot of advice sellers and buyers receive are from their real estate agent rather than a third party source.
While agent advice is valuable as agents are the ones who know what will sell and what won’t, the industry desires to strengthen perception amongst Japanese buyers that second hand is safe.
Currently, home inspections can be asked for but for the results of the inspection usually are not included in the language of a contract. The seller and buyer needed to mutually agree which can be very subjective.
With the introduction of licensed home inspectors, their findings can be included in the language of contracts and other documentation needed to execute the trade thus incentivizing sellers further to improve their property prior to going on the open market rather than leaving issues for the buyer.
Condo buyers and sellers can ask for an inspection to be done if desired however condos usually have professional building management in place which keeps detailed records of upkeep and repairs. Ergo, demand for condo home inspections expected to remain low after April 1st.