No one works for free and we are no different. However, when it comes to brand new properties, brokers in Japan can not charge a brokerage fee.
I mentioned in last week’s article that developers sometimes pay brokers 3% of the sales price at delivery allowing the broker to pass along the cost savings to their clients.
Depending on market conditions however, not all developers pay introduction fees to brokers. The market conditions dictate developer confidence on whether they think they can sell the units themselves.
If the developer feels they can sell the unit without the help of brokers, then there is no need to offer an incentive to firms like ours to promote the property.
This means if you live outside of Japan and are interested in purchasing only brand new condominiums then there is a high chance you will not see any information on the development at all.
This is the main reason you should at least be open to the idea of paying a consulting fee to your agent for brand new property. That fee will allow us to work for you giving you the same access and purchasing capability to all the inventory as if you were a resident of Japan.
One might think that if they attend a Tokyo property seminar in their locale then they would be able to achieve the same result.
In reality though, the units on display at any given overseas seminar are usually the authorized units the developer gave permission to display at that particular seminar. Additionally, the units on display are not even the whole selection available in the development but only a portion of the units on sale.
The developer taking units overseas is also making the presumption that you can not read Japanese or call them up directly. If you can do so, then you have the same access as everybody else does locally, but if you can not or do not have the time to follow up yourself, then you are at a disadvantage.
Another thing to remember is that buying a brand new property is much more involved than buying a second hand property. In addition to the creation of the Home Owners Association, there is the contract reading, interior design option selection, delivery preparation, checking of final product prior to delivery and many more items that need to be confirmed and completed prior to delivery.
In many cases the developer requires the buyer to be at these meetings in person; a feat which someone living outside of Japan would find time consuming and expensive to fly back and forth.
Most developers selling to overseas people require that buyer to appoint a representative in Japan for these matters. Hence the need to a qualified & licensed real estate agent.
You might have friends in Japan you might be able to ask for the same service however a friend or acquaintance would be hesitant to take on the responsibility of representing you multiple times throughout a process that can take up to two years. This is especially true of risk averse Japanese people.
So, for access to all the brand new development information out there and the safest purchasing experience available, most buyers find it better to hire Housing Japan for a consulting fee to guide and represent them through the buying process.
At the end of the day, the fee developers pay to brokers is factored into the price you are paying for the unit so either way, you are paying. Our clients understand this and find it is best to pay us a fee to get unlimited access and buying ability.
If the developer pays us then we won’t charge you. However if the new development you like is not paying a fee to us, then it is definitely safest to pay us as your representative in Tokyo for the transaction.
Editor’s Note: Shirley is Sales Director for Housing Japan. She has sold billions of yen of real estate and arguably has the highest client satisfaction rating in the industry. Shirley writes a weekly column for Housing Japan readers to help illustrate common challenges buyers and sellers have when trading Tokyo residential property.