Guide to Buying a Home in Tokyo

Buying property in Japan can feel daunting, especially for foreigners who may not be familiar with the language, culture, and legal system. This guide is designed to help you navigate the process, from understanding the legal requirements to finding the right property and securing financing.

Whether you’re buying a home, a luxury residence, or an investment property in Tokyo, you’ll need to work with an agent who can help you complete the Japanese paperwork, financing, and contracts. You’ll need to find the right property, make the purchase application, arrange payment, and close all contracts to Japanese legal standards. Managing all of this across English, Japanese, and Chinese is where our multilingual team can help.

Guide to buying a home in Tokyo, image of interior of luxury Japanese apartment living area close up.

We begin by partnering you with an agent who helps you get the most out of the process. They start by consulting with you about your needs, priorities, and intentions, then move on to sourcing suitable on- and off-market properties within your budget and criteria.

You’ll need to have a specific property in mind before you can discuss financing with a local Japanese bank, as banks do not provide even a preliminary mortgage assessment until they know the type of property you intend to buy.

Other areas you may need help with include taxation, resale potential, and arranging property management for a home you intend to rent out, either short-term or long-term.

The Search

Your agent will draw up a list of properties, and once you’ve reviewed the options, they’ll take you through viewings, explaining anything you need to know about each property and its local area.

You’ll want an experienced, licensed, agent with access to current listings in Tokyo, since not all property is listed openly on the market, much of it is offered privately or off-market. Working with a brokerage like Housing Japan gives you access to a wider range of options when it comes to making a purchase decision.

Financing

In many cases, Housing Japan agents can advise on financing and tax matters thanks to our experience and in-house knowledge. Where more specialized advice is required, we can also put you in touch with the appropriate experts. On financing specifically, we work closely with a number of major banks in Japan, both domestic and foreign, as well as several smaller financial institutions, including some that approve loans for buyers based overseas.

Application (購入申込書)

When you find the right property, you submit an application to purchase (購入申込書, also known as 買付証明書). This is a non-binding written expression of your interest in buying the property at a certain price, along with how you intend to finance the purchase. The application shows the seller you are serious and begins the negotiation process.

Explanation of Important Matters (重要事項説明)

Once the price is agreed, your agent begins the contract process. The agent is required to investigate the details of the property and provide you with an Explanation of Important Matters (重要事項説明書). This document sets out all the important terms of the contract. You should read and fully understand it before executing the contract and it must be explained by a licensed real estate agent working for the real estate company you are buying with.

Executing the Contract (売買契約)

The contract signing (売買契約) usually takes place at the agent’s office and takes around two hours to complete. At this stage it is typical to pay the seller a deposit (手付金) of 10% of the price, or around ¥10 million, though the exact amount is negotiable.

Loan Application (本審査)

Although you’ll usually have pre-approval (事前審査) from a lender, you make the formal loan application (本審査) once the contract is complete. Final approval typically takes one month to six weeks, after which the closing date can be set. If you’re using bank financing, the contract will normally include a loan contingency clause (融資特約) stating that you are applying for a mortgage from a particular bank by a proposed approval date. If the mortgage is not approved, the contract is terminated and your deposit is returned.

Final Settlement (決済・引渡し)

The final settlement (決済・引渡し) usually takes place at the buyer’s bank and is handled by a judicial scrivener (司法書士). You transfer the remaining balance to the seller’s account, and title to the property is transferred and registered (登記) in your name. On completion, the seller hands over all the keys and the transfer of ownership is complete.

Summary of Costs

When buying a property in Japan, taxes and fees normally come to around 5–6% of the property price. You can find a full breakdown on our Tokyo Property Taxes and Fees page.

Laws Relating to Real Estate in Japan

One of the great strengths of the Japanese property market is that laws are strictly enforced and there is a clear understanding of everyone’s rights and responsibilities. Rather than reproduce what has already been set down, we’ve made available a PDF from the Japanese government that explains the relevant legal issues. You can download the government guide here.

What Next?

At Housing Japan, we specialise in buying, selling, and managing residential luxury real estate in central Tokyo. As a licensed real estate brokerage with over 25 years of experience in the Tokyo market, we guide both resident and non-resident buyers through every step of the purchase. Browse our latest properties or reach out to us today to discuss what you’re looking for. Our dedicated agents are ready to provide expert advice tailored to your goals.