How to buy your first home in Japan? Guide for foreigners
How to buy your first home in Japan? This challenge can seem so hard and daunting. The home buying process in Japan can be filled with steps you never knew. Especially for first-time home buyers who aren’t familiar with the process.
We bring you Guide to buying a residential property in Japan, with insight into some of the head- spinning legal and technical terms that homeowners-to-be must wrestle with.
Have cash ready or get housing loan in Japan for foreigners
If you don’t have cash, you’ll likely be looking to buy your first home in Japan through a mortgage. But you should know that is the best solution to pay 25 to 30 percent of the purchase price in cash. Before the bank grants you a mortgage, they insist on certain annual earnings.
Applying for a mortgage: Can a foreigner buy a house in Japan?
Buying a house in Japan for foreigners can be hard but it is possible. After your stress-free moving to Japan, apply for a mortgage. Many Japanese banks only land home loans and mortgages to permanent residents. But some banks give home loans to foreigners on the specific conditions. They consider years of residence and the intention of living in Japan for a long time. Rates, of course, vary from bank to bank.
For example, the Commonwealth Bank of Australia lends home loans to foreigners living outside Japan and investing in Japanese properties.
Most Japanese banks require mortgage buyers to take out group life insurance. Also, the property must be registered as yours. Make sure you keep the proof of the registration, as you will need it to resell the property later.
How much is the average house in Japan? How much does it cost to buy a house in Tokyo?
Buying a house in Tokyo Japan – In 2014, the average price of a second-hand house in Greater Tokyo was 29,580,000yen (about 247,120USD), and the average price per square meter was 434,100yen (3,636USD) per square meter.
To buy your first home in Japan – Hire an Agent
When you buy your first home in Japan you should hire a real estate agent. An agent will save you time and money. The process can be so much easier with real estate agent who knows what to do.
– An agent have all the listings that fit you
– Agents often know of new home real estate listings coming up that are not yet on the market.
– Some agents will preview homes for you.
– When you search homes you don’t have to waste your own gas
When you have a real estate agent you know in which areas you can live and what price you can afford. They will find your ideal type of property.
If you don’t trust your agent, search for a new one or use multiple agents.
Research the area
Ask yourself a few questions before you start seeing places: How much space do you need? How much can you afford? Suburbs or city center? House or condo? Just remember that you may be forced to adjust your expectations. You should at listings online to know what you can find in each neighborhood.
* Visit the area you are interested in at different times of the day. Use trains so you can experience a commute.
* Find out what services for day care for children you can find in the certain area.
* Research the area’s earthquake risks. Some plots are cheaper than others because of risks.
Buying an apartment in Japan
For apartments, pay attention not only to interior features. Also, check buildings maintenance. It is very important when you buy an apartment. Be worry if the maintenance fees are cheaper than other similar properties.
Buying a house in Japan cheap
Land with an existing old house on it is usually cheaper than empty plots. This is because buyers have to demolition existing house before building a new one. “Japanese houses have a very short life span, with half demolished around 40 years after construction”, according to a study by Yukio Komatsu, the professor at Waseda University’s architectural department.
Buying land to build a house on
This is probably the most challenging option for home-buyers. The first step is to buy land and then you ask a builder to construct a house. You can hire a house building company with building contractor and the architect office. You also choose whether to engage the house-builder or the contractor. They both design and construct your house.
Either way, it is necessary that you hire an architect to supervise the actual construction progress. He/she will protect you against bad work.
Make an offer
If you decide to buy your first home in Japan, you make a purchase offer by filling out an application form. New condos are often sold through a lottery among applicants. When you apply, you need to pay a deposit. It will be returned if you entered a lottery but didn’t win.
Have important matters explained
Before any purchasing a home, you need a broker to explain to you details of the property. Such as registration, methods of payment and clauses for canceling the purchase agreement. This process, called juyo jiko no setsumei (explanation of important matters), is happening on the day you sign a purchase agreement. Make sure you get a copy of the forms explaining important matters. Be prepared and read them so you can have answers to all of your questions.
Can a foreigner purchase property in Japan? Where can foreigners buy property?
In Japan, we can also talk about restricting land ownership to foreigners. But these discussions are usually referring to purchasing land in areas that may be of importance to national security. For example, military bases, and forests with natural water sources.
You should know that in Japan are no laws or regulations which control or forbid the purchase of Japanese real estate by foreigners. Foreigners in Japan have no restriction for buying a house or property. Also, you can buy a real estate without ever visiting the country. But you should know that is not a good idea to purchase a house without seeing it.
Property titles can register to a foreign address. So you can buy and sell land, homes, apartments, private islands, or entire buildings in Japan.
Finally, buy your first home in Japan is a time-consuming process. So don’t forget to have patience!