Buying property in Japan is simpler than most foreigners expect. Unlike many Asian countries, you don’t need citizenship, a visa, or even to live in Japan. Japan has numerous ongoing development projects, especially around the Tokyo area – continuously creating countless opportunities for finding a perfect, luxurious house in a great location. However, if you are an expat planning to purchase a house, either for private use or as an investment, there are many factors to consider. These include legal procedures, financing and cultural differences affecting successful real estate purchases in Japan.
The process of buying a property requires creating your own team of professionals – a broker, loan officer, judicial scrivener, and tax advisor. Once, you have made this team and have built a relationship, trading real estate will become much simpler.
Can a non-Japanese buy a property in Japan?
This is the first, fundamental question that needs to be answered. The answer is ‘yes’, as an expat, you can purchase both land and properties, including apartments in Japan. No citizenship or residence visa is required. In fact, the process is much simpler than you might think, and the exact same rules and legal procedures apply to both Japanese and non-Japanese buyers. This makes Japan unique compared to other Asian countries, where land and real estate ownership is more strictly regulated by the state.
Step-by-step Guide to Buying a House in Japan
The experts at Housing Japan have been supporting individuals seeking to buy real estate in Japan for 25 years, allowing us to refine our experience into a step-by-step, best practice guide for purchasing a house in Japan.
1. Contacting a Realtor
Firstly, with such a big decision as investing your money into a property, what you need is trusted guidance from local real estate professionals. There are many reasons for this, including:
- legal safety
- documentation translations
- professional advisory regarding prices and market trends
- property viewing assistance
- market standards and price advisory
- negotiations and formal processes with the seller
Your first step should always be to consult an agent and outline your preferred location, property requirements and budget.
2. Site Viewings
Housing Japan offers a team dedicated to researching both on-market and exclusive off-market real estate deals in Japan to help you find the perfect property for you.
3. Consult with A Bank
Talking to a bank is important when buying a home. This step is essential for thorough preparation, enabling you to respond promptly when you find a suitable property.
If you intend to purchase your new home with cash, consulting with a bank may not be imperative. However, if you plan to use a loan, initiating discussions with banks before starting your property search is essential.
The significance of securing financing lies in obtaining a informal approval from a bank. Japanese banks can provide an informal pre-approval for your loan request, serving as a powerful negotiating tool when communicating with sellers. Moreover, the loan application process requires time, emphasizing the importance of early engagement to facilitate swift action when discovering a desirable property. As an expatriate, it’s crucial to recognize that Japanese society places a strong emphasis on trust, and even a verbal approval from a bank can instill confidence in the seller, making them more inclined to finalize the deal.
4. Expressing Property Purchase Intent
After deciding on a house or an apartment, it’s time to officially express property purchase intention by submitting a Letter of Intent. From that moment onward you are considered a serious potential buyer. The Letter of Intent gives you the right to negotiate the price and is generally treated on a first-come, first-served basis – another reason why having financing in place first so you can act faster than your competition.
5. Negotiations & Initial Payments
The following step is your agent negotiating (with the seller) details regarding purchase price, possible payment methods, payment timings, etc. This process can take about one to two weeks, but can take longer, as both parties draft legal documents, undergo final due diligence, and fulfill formalities. Also, if you plan to finance your purchase with a mortgage, this is the time to apply for a loan with a bank.
6. Executing the Contract
Your agent should provide an “Explanation of Important Matters Regarding the Property and Transaction”. This is a set of documents that includes owner title registration, ownership type, property legal description and any provisions in case of contract cancellation.
At this stage, a cash deposit should be paid to the seller (5% to 10% of the purchase price). This is often surprising for many expats as earnest money is usually paid to a third party such as an escrow. The idea behind this is that Japan is a trust-based society, and paying part of the cost up-front is a sign of commitment and solidifies trust. To be clear, even buyers purchasing a house in Japan via a mortgage need to pay the deposit in cash that’s been saved up.
7. Final Loan Approval from the Bank (Only for loan buyer)
After receiving the final approval from the bank, you will proceed to enter into a loan agreement. Contracts are typically executed on weekdays and require several hours to complete.
The easiest way to purchase property in Japan is with without a loan or mortgage, however that’s not to say getting capital through a loan or mortgage is hard for foreigners. There are many banks that allow mortgages and loans for foreigners and Expats at very competitive rates.
8. Final Settlement
The final settlement usually takes place at the buyers’ bank and is handled by a judicial scrivener (a legal professional who handles property transfers). The buyer will transfer the remaining balance to the sellers’ account and the title of the property will be transferred to the buyer. On completion, the seller delivers all the keys to the property and the transfer of ownership is complete.
Let the professionals take care of every step of the process.
Purchase Costs and Taxes
Costs and Taxes
Normally it costs 5% to 6% of the Purchase Price.
(There is an additional 1% to 2% costs by banks, if mortgage is involved.)
| Fee | Judicial Scrivener | About JPY 100,000 – 150,000 |
| Agent Fees | Property Price X 3% + JPY 60,000 + 10% Tax | |
| Other Cost | Insurance, Housing Cleaning, ect. | |
| Tax | Asset Tax | Estimated Value X 1.4% (Transaction Day to 31st Dec) |
| City Tax | Estimated Value X 0.3% (Transaction Day to 31st Dec) | |
| Registration Tax | Estimated Value X 2% | |
| Stamp Duty | Differ according to price: JPY 10,000 – 480,000 | |
| Acquisition Tax | Land: Estimated Value X 1.5% Building: Estimated Value X 3% Commercial Property: Estimated Value X 4% |
*All fees and taxes should be paid at the time of Transaction (Acquisition Tax is paid in 3-6 months form the Transaction Day)
*Above tax rate is for general situation. By property type and purchasing purpose there are deductions case by case.
To get an estimate on your monthly loan payments in Japan, you can refer to our Yen Loan Calculator.
Other costs might include property tax, registration fee or property management fees.
Important Documents
- If you live in Japan, a residence card, passport, and an Inkan (traditional Japanese seal for signing important documents)
- An Affidavit, if you live outside of Japan. (This is a voluntary, sworn statement made under oath, used as verification)
- For loan users, there will be other documents required by the bank such as a proof of income for three years
Contact us for more specific details about sharing your balances and financial documents.
Why buy Toyko Real Estate
Tokyo stands out as one of the world’s most stable real estate investment markets, with consistent property values and strong rental yields driven by high demand from both domestic and international tenants. The city’s position as one of Asia’s financial hubs ensures steady capital appreciation, while Japan’s mature legal system and transparent property laws provide security rarely found in emerging markets. Tokyo’s exceptional connectivity through Haneda and Narita airports makes it a prime location for international business travelers and expatriates, creating reliable rental income streams.
The city’s extensive infrastructure, from world-class amenities to efficient transportation networks, maintains property desirability and long-term value retention. With Japan’s stable currency, low interest rates, and government initiatives encouraging foreign investment, Tokyo real estate offers investors a compelling combination of capital growth potential, rental income stability, and portfolio diversification in one of the world’s most economically resilient cities.
Things to Keep in Mind When Buying a Property in Japan
For many expats planning to buy a house in Japan, it might be surprising that no lawyers are involved in the legal property buying process. Licensed brokers in Japan are required to perform both brokerage and legal roles in every real estate trade they handle. This unique system makes choosing an experienced agent crucial, as they’ll handle everything from market analysis and negotiations to legal documentation and title transfers. Your agent becomes your primary legal protection throughout the entire transaction.
While Americans and other foreigners can freely buy property in Japan without any nationality restrictions, understanding visa requirements is important for your long-term plans. If you intend to move to Japan permanently to live and work, you’ll need to obtain a proper visa. However, for property purchase alone, 71 countries including the United States receive visa exemptions allowing up to 90 days for initial property viewing and purchasing activities. This visa-free period provides ample time to complete most real estate transactions, making Japan accessible to international investors and those seeking vacation homes without complex residency requirements.
One critical consideration is that all documentation during the process will be in Japanese. Every contract, legal document, and regulation will be presented in Japanese only. Even though translations are provided by most reputable agencies, only the Japanese texts of laws and regulations have legal effect, with translations serving solely as reference materials to aid in understanding Japanese laws and regulations. This makes it essential to choose an agency with strong bilingual capabilities, experienced staff, and a reliable legal team who can clearly explain each step and ensure you fully understand what you’re signing.
The entire process typically takes 60-90 days from initial offer to final settlement, requiring patience and proper preparation. By working with experienced professionals who specialize in assisting foreign buyers and understand both Japanese regulations and international client needs, you can navigate the property purchase process smoothly while ensuring all legal requirements are properly fulfilled for a successful transaction. Additionally, it’s crucial to find a trustworthy Japanese real estate agent who can guide you through the buying process smoothly.
Q&A: Common Questions About Buying Property in Japan
Can foreigners buy property in Japan?
Yes, foreigners can buy both land and residential property in Japan. There are no legal restrictions based on nationality. You don’t need Japanese citizenship, a residence visa, or even to live in Japan to purchase property.
Can Americans buy property and real estate in Japan?
Yes, Americans can buy property in Japan. They have the same property buying rights as any other nationality. The Japanese real estate market is completely open to foreign buyers, including US citizens, with no additional requirements or limitations.
Can I buy land in Japan as a foreigner?
Yes, foreigners can purchase land in Japan just like Japanese citizens. This includes both residential land for building homes and existing properties with land. The same straightforward process applies to all property types.
Is the buying process different for foreigners?
The process of buying a House, Land or an Apartment is identical for Japanese and foreign buyers. You follow the same legal procedures, use the same documentation, and work with the same professionals. This makes Japan unique compared to other Asian countries.
What types of properties can foreigners buy in Japan?
Foreigners can purchase any type of property available to Japanese buyers. This includes apartments, houses, commercial buildings, and vacant land. There are no restrictions on property size, location, or value for foreign purchasers or if the land is Freehold or Leasehold.
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