Mastering Japanese Real Estate: A Guide to Renting in Japan

If you are planning to live in Japan soon, it is probably too early to think about buying a house or looking for abandoned akiya. But rather you are most likely looking to rent a place to live. Renting in Japan can be a scary experience for foreigners new to Japan. But with the right information and preparation, becomes less daunting.

If you are planning to move to Japan, this article is for you. Here, we cover critical steps regarding the rental application process for living in Japan.

This guide aims to educate about:

• Japan rent price breakdown
• Additional rental costs
• Understanding Japanese rental guarantors
• Types of Japanese rental properties
• Japanese rental application process
• Important cultural tips for renters

1. How Much is the Average Rent in Japan?

The average rent in Japan is 61,367円(yen). While this average rent price represents Western Japan (Osaka, Kyoto, Kobe, Nara) accurately, Tokyo rent prices are an outlier. Tokyo rent prices are much higher because both the population and average salaries are much higher than the rest of the country.

Rental data sourced from 全国賃貸管理ビジネス協会 (National Rental Management Business Association). Exchange rates were sourced from XE on 2024/08/24.

2. Breakdown of Rental Costs and Fees in Japan

Securing an apartment or house can be a challenging and expensive task. When moving to Japan and finding rental housing, you should be aware of various costs that you might have to pay before you move in.

Key money, also known as "礼金" in Japanese, is a fee that tenants are required to pay to the property owner when signing a lease agreement. This fee is not returned to the tenant. Generally, the amount of key money required is equivalent to one to two months' rent. It serves as a form of upfront payment to secure the rental property.

You must clean up the room and fix anything that got broken while you were there. Most of the time, the landlord will return the security deposit if you don't break anything on purpose or by chance when you move out. But they might take cleaning costs out of it.

The renewal fee is a non-refundable charge. The property owner decides on this fee two years after the start of a contract.. This fee can cost between one to two months' rent. It is an additional expense that tenants need to think about when extending their lease agreement.

A brokerage fee (仲介手数料) is a cost that is usually the same as one month's rent, plus a 10% tax. The renter usually has to pay this fee, and it goes to the real estate company. This fee is important because it pays for the services the real estate company provides to help with the rental process.

The renter pays a fee to a guarantor company. Landlords typically ask tenants to pay between 50% and 100% of a month's rent as a deposit. Then, the guarantor company will require a fee of 10,000 yen at the time of contract renewal, either 1 or 2 years later.

3. Breaking down the Japanese Rental Guarantor

A Japanese rental guarantor is someone who promises to pay the rent if the tenant can't. This person or company makes sure the tenant follows all the rental rules, like paying rent on time and fixing any damage. It is a guarantee for the real estate agent that all costs will be paid for, no matter what happens.

For Japanese renters, when they need a rental guarantor, they usually to their parents or grandparents, or even employer, to sign up. Some landlords may have specific criteria for rental guarantors, such as being a Japanese citizen or having a certain income level. However, many foreign residents in Japan may not have these options available to them. Therefore, in this case foreign residents can turn to a rental guarantor company.

Some real estate companies offer rental properties that don’t require a guarantor. However, these rental properties may be more expensive than other Japanese rental buildings. Some of the following companies do not require a guarantor:

• Yolo Japan
• Apts.jp
• Leopalace21
  

4. Navigating the Japanese Rental Process Step-by-Step

When applying for housing in Japan, foreigners need to show important documents to prove who they are and that they can pay for the rent.

• Two main forms of ID: a passport and a residence card or student ID;
• Clear copies of the photo page of your passport, the page with your visa stamp, and both the front and back of your residence card or student ID.
• You also need to show proof of income. This may include recent pay slips from the last two to three months. You may need a copy of your annual tax slip to show you can afford the rent.
• You might also need to provide an emergency contact and a Japanese phone number.
  
  

The rental application process includes a careful background check by landlords. This screening assesses several criteria:

• the applicant's identity;
• stable income;
• is the income at least three times the monthly rent.
  

Landlords also consider the applicant's ability to communicate effectively. Managing companies need to coordinate with tenants for maintenance and neighborhood issues.

Understanding these aspects of the rental application process is important for those moving to Japan. Providing a clearer pathway through the complexities of the Japanese rental process.

FAQs

Can foreigners lease residential properties in Japan?
Yes, foreigners can lease rental properties in Japan. However, all potential tenants must undergo a background check, which is a standard requirement irrespective of nationality or the nature of the contract (individual or company).

What is the typical rental cost in Japan for foreigners?
Japan rent prices vary depending on the location. The national average rent in Japan ranges from 50,000 to 70,000 JPY (approximately 470 to 650 USD) per month. Tokyo rent prices are known for being the highest. Osaka rent prices and Kyoto rent prices are generally lower than Tokyo but still higher than the national average.

Is it challenging for a foreigner to secure an apartment in Japan?
Yes, it can be quite challenging for foreigners to find an Japanese apartment, especially for those renting in Japan for the first time. Many landlords and rental agencies are hesitant to rent to foreigners, with only about 10-20% of Japan real estate companies open to foreign tenants. Gaijin houses cater specifically to foreigners and can be a good option for those struggling to find a place to live.

Is it possible for a tourist to rent an apartment in Japan?
Tourists can rent apartments for rent in Japan under short-term lease agreements. These short-term rentals do not typically require a security deposit or key money, making them a convenient option for tourists and business travelers. However, it's important to be aware of any potential stigmatized property issues before signing a rental contract.