Lots of good points. I built a home in Japan and don't regret it. While the house itself loses value, good property definitely has resell value in many parts of the country. But the biggest advantage is better QoL, not finances. Fully insulated, heated flooring, higher ceilings, solar panels (with energy prices the last few years, especially glad I have them) and being able to freely renovate both interior and exterior, as well as not having to worry about noise issues below, above or next to us. From a financial perspective, fully owning your own place seems much better once you are a pensioner/retired and on a fixed income as you have more control over costs.
Absolutely. I have big plans for when we move into my wife's parents' place eventually: solar, batteries, water catchment tanks, growing our own food... 🤩
Great video, thanks Ben. Just wanted to mention that if you have pets and want to rent, it can be challenging. Specifically for dog owners - if you're looking to rent an apartment/mansion, they may allow you to have a small dog (under 10Kg). If you have a "big" dog (big dog in Japan would be considered a medium size dog in North America), over 10Kg, then you'll probably have to find a house. And even with a house, most rentals will only allow the dog to stay outside.
There are apartments you can rent in Japan which are specifically designed for pet owners being equipped with things like ventilation that can handle fur, but you do pay a premium for that.
That is exactly why I bought my flat (two months ago, actually). I have two small rescue dogs and I was sick and tired of crying every single time I had to move to a new place (imagine, foreigner plus two dogs...). I was also tired of living in very old and dark apartments while being charged a lot for rent, so now I have a much cheaper mortgage and a wonderful new flat with amazing light and view. Totally worth it for me. It might be emotional, as Ben said, but really, isn't life about trying to be happy?
I bought an apartment in japan, and for me it is the best of the two world. You can save up the rent and the depreciation is not so fast like a house. If you are planing to stay few years in japan but not all your life, buy an apartment can be a good choice. And buy an new apartment is better as well because you save up some tax and some fee.
Buying a new apartment (マンション) is no no in Japan. It is same as buying a new car, the moment you bought a new car the car value drops 30%. When you are buying a new apartment you are paying 30% profit to the builder.
@@lutherjr2646 no it is not true, the value doesn't go down just after buying, it is decreasing but not so fast. And in my case after 3 years living in my appartement I can sell it 20% more
@@jonathanpretre6864 lol my click bait worked. As you said not so quickly decreases the value of an apartment, but it decreases faster during first five years then gradually decrease up to 10 years, then again decreases more slowly after that. And as you already know this does not apply during years since the pandemic as the apartment prices skyrocketed from that time. Experts are saying this trend will continue few more years as developers have already purchased the lands in Tokyo area with high prices and the construction materials costs are increasing so fast because of inflation and also the labor costs are increasing because of the labor shortages. There are still demands in the central Tokyo area now, but this upward trend will end by 2030 an expert said because there will be so many vacant apartments and houses as baby boomers will start dying more quickly from that time on. I learned about these because I was going to buy an apartment for myself, but it is insanity to buy an apartment right now even in other metropolitan areas in Japan knowing the prices will start dropping in few years.
Another considerable cost in buying a house is the cost of renovation and maintenance that is often “built in” with system kitchens and system bathrooms. Our house was six years old when we bought and had already depreciated 50%, however now-15 years after our purchase-we have to spend 4.5 million to 5 million yen on the system bathroom (can’t just repair a few things -the entire unit MUST be replaced) and the paint on the house. But we will never see that money back because by the time we try to sell-if we can sell-the house will be worth nearly nothing. In my opinion this is a ridiculous situation.
I think another advantage of renting is that especially if you have kids, you can adapt the size of your housing when they leave. However it is very hard to rent when you reach 65-70 years old, most landlord will fear you could die in the rented property which would make it almost impossible to rent again.
That is another vote for flexibility. We used to rent an enormous 100 tsubo house when we had three teenagers but now that they have all moved out my wife and I are perfectly happy with a 3LDK manshon.
@@RetireJapan_OGActually I did buy my apartment in Kawasaki 10 years ago. I still think that despite depreciation if you live in the exact same place for long, it is worth it and still kind of an investment. However we might need to move to Yokohama for a couple of years and I think I would rather rent a place then but keep our current apartment or resale it for reasons you explained in your video 😊
Nice points, Ben. As someone also mentioned, the ability to have pets is another plus for buying. Would love to see a video on the pros/cons of building a house in Japan. We're building with Ichijo and while we may not even retire here and want to sell in 5-7 years, we'd rather have a nice place to live and hopefully won't lose too much, if any. As you mentioned, buying/renting isn't strictly a financial decision, but we couldn't afford, let alone find, a comparable place.
Ichijo are great. Some limitations, but excellent quality for a decent price. We got as far as almost signing a contract with them, but had to cancel at the last minute (we couldn't get permission to rebuild on the land).
Am 65, currently rent is covered by company, planning to take over the rent next year when retire. Landlord might not accept, offered them to buy, since like the place , but ownership is in multiple persons. In short, after 65 in Japan without owning the place is a worry. Although I heard if I have enough means , I can secure the guarantor, all then comes to landlord willingness … great video!
Yes, there are more options now with guarantor companies, etc. I have read articles saying the government is aware of the 'elderly difficulty in renting' issue and is working on improving it too.
If you had 3 psychotic neighbours, unusually bad luck, but I feel like you should tell us the addresses so we don't buy your former homes which are no doubt deeply discounted.
Lots of great information on your channel as well as in the comments section. I’m American, my wife’s Japanese, and we’re considering moving to Japan after I retire. My wife is about 10 years younger and will keep working a while. I’ve always preferred buying a home instead of renting in America. On the fence about buying or renting in Japan given the differences there. So this gives me food for thought.
My wife wanted to live in her hometown. We rented for years but finally bought a condo in 1995. I thought it would be good protection for my wife if something happened to me. I paid it off early because I didn't want to be paying when I was retired. Only thing I didn't plan for is my wife passing away earlier this year. I have added earthquake insurance recently.
Thank you for being so informative and clear, and speaking like a real person who's not hyping one point of view. I'm about to move to Japan for work, and I'd eventually like to buy my own home. Some of the cheap prices are attractive and get my hopes up. I know there are pros an cons, and you answered my basic questions.
I've always rented, but like most long-termers in Japan, I've often pondered the buy vs rent conundrum. One thing in favour of renting that, surprisingly, never gets mentioned is that rents don't go up, unlike the countries where most of us are from. Before signing the contract for my house I asked if the rent would go up, and the fudousan man looked confused, as if he didn't quite understand. 16 years later I'm still paying the same rent.
I've been bingeing on your videos and really, they need to be a standard 101 for anybody looking to live and work here. We decided to buy having found a fully furnished, "display" apartment, in a relatively new smallish complex, that was completely renovated on the ground floor, 5 minutes from a major station on foot, with a nice park out the back and plenty of space for us inside - 3LDK is more than enough. And at the price we got it for 6 years ago, it was a real bargain as the surrounding area has exploded with a dozen tower buildings and that has only pushed the price of our place to almost double what we paid on the mortgage if we ever wanted to sell. I still get peeved remembering we have to pay a monthly 800yen surcharge to the city council for having access to the "garden space" out back since that wasn't on the zoning plans and the council makes us do all the gardening!
If you don’t mind me asking, how much roughly are the fees you have to pay in an apartment block in Japan?. I live in the UK and we pay management fees and ground rent which are often a real rip off. Just wondering if it is similar or more reasonable in Japan. As my wife is Japanese we hope to secure a flat/house in Japan at some point.
Thanks for posting this. Lots of pros and cons for both situations. We own our house but we don't own the land, which is a situation peculiar to Japan I suppose. In our case, our landlord is a fantastic family, (we have known them for more than 40 years) so we are very lucky. My daughter and son-in-law did a major renovation on the main house when they decided to come back and live here, when my daughter wanted to go back to full-time work after time off for having two children. I now live in the hanare, a separate building. So for me, this is a good situation although there are pros and cons. All in all, I enjoy living with the grandchildren and helping out when I can, which is actually quite a lot. And we can also have a large dog without any issues. Luckily we didn't have any major damage in the 2011 earthquake.
Also thinking about buying vs renting. One thing that is bothering me for buying an apartment in a condominium when looking around prices is the "kanri fee" and "repair provision fee". These together can sometimes be like half the rent fee you would pay or ask for the place... It is like renting your own apart for half the fee... Houses do not have this problem... But some day a big repair might show up...
Yes, very important to be aware of any fees. Manshon kanrihi pays for cleaning, staff, electricity for lighting and elevators, etc. Repair fund pays for repairs, maintenance, upgrades. If you own a house you are responsible for repairs and maintenance (also important to be aware of those fees).
Thanks for the video! I would add that it also depends on the location. Some popular places in Tokyo are overpriced in my opinion. So renting in those areas would be a good option and use that money for something else like investing.
My wife owns and rents out a flat in Tokyo. If the building collapses or some such thing, each owner of a flat there owns a corresponding piece of the land on which the building was built and it was built on the highest grade assessed land. Make sure you research and have surveyed the land quality grade if buying. Grades start from Grade A B C etc.
Not related but if you live in Tokyo, the Tokyo Gov will pay the school fees for all private school fees from April this year….this is not a typo!@@RetireJapan_OG
A benefit of buying is that you no longer need to deal with estate agents again unless you want to sell. Typically rents are 2-year leases and you then have to extend and manage the estate agent again. Obviously personal choice but avoiding any dealing with an estate agent here in Japan is a major plus point for me since I find them universally loathsome…
That is a very good point. Kind of like getting PR and not having to deal with the immigration office any more, buying a home and not having to deal with estate agents is a major plus :)
We bought a condo which I feel is totally different to buying a house. The depreciation is nowhere near that on a house and if you choose wisely can actually increase in value. We were paying around ¥250,000 a month in rent for a crappy apartment. Having a dog drastically reduced the options available. buying allowed us access to a hell of a lot more apartments and we could choose what suited us the most. Buying for us was a no brainer. Spending money on rent you are 100% never getting that money back, as well as the key money, but with a condo there’s a good chance you’ll get a decent amount back if you choose wisely. For us I think depreciation will be a lot lower than what we would have spent on rent for a similar place to what we bought. We only live here for a few months a year but it’s still better for us to have our own home here and gives us much more flexibility coming and going plus it means we have a place to call our home and can do whatever we want on the inside.
Hi, I only visited Japan 2x and have not left my heart since, your exact ideas of having a place to live in for any amount of time as you please and leave when you need change is what I have discussed with my husband, were on our 50's, not close to retirement working in the US, no plans of working in Japan, just love to learn their cultures and when we need "restfull" month stay, do you mind sharing your agent you used or your journey and current place of your "home" plssss, outside of Tokyo? Osaka? Hiroshima? Thanks @WylieWestie
@@RetireJapan_OGthank you for great informations, do you mind recommending an agent that I can use pls, what do you think of the places like Chiba or Omori or Otsuka?? Outside of Tokyo but not far away through trains
Running into the landlord refusal (specifically because I was a foreigner I was told) was a bit of a shock. I'd stayed at two different properties in Hokkaido (1 apt, 1 rented house) and an apartment in Tochigi and never had a problem. So coming up against it in Miyagi was an eye-opener (maybe I'd gotten lucky over the previous 10 yrs or so?). I argued "差別" and was given extra hoops to jump through, but was able to rent. It's been the worst rental experience I've ever had in my life (wasn't a lot of options after 2011). Thinking about trying to find an 空き家 at this point.
Yeah, I was trying to rent a house in Sendai (haven't had trouble with apartments) for my family in 2004. I had a government job with the Kencho, a Japanese wife and family and we got turned down 30+ times. Only found somewhere through one of my wife's friends in the end. Not a good experience.
Interesting, I had no real issues doing the same circa 2015. Visited many properties with 4 different agencies and ended up getting a decent one not far from Sendai Station. I was turned down once I think as the owner wanted someone more long-term than my year-to-year contracts.
Owners can do things that might be prevented by landlords, such as smoking, having large pets, being too young or too old, being gaijin, having a medical disability or even a preexisting condition, being too tall, being too fat, only having an N4 JLPT, waving at people in a friendly manner, etc. Also, Ben, why Sendai? Have you ever made a video about that? I've been to Sendai, lovely town no doubt about it, demo ...
@@RetireJapan_OG I used to pay 65,000 per month for my mortgage, and I am now paying 70,000 per month for my brand new "manshon"-type apartment. Not much in it at all.
Thanks Ben for the very information video. A couple of questions: 1) you mentioned the transaction costs with buying/selling property. How do they compare to the transaction costs associated with changing rental properties though? I just recently relocated to Japan and got quite the wake-up call with having to pay rei-kin (which could be 1-3 months worth of rent depending on the place), deposit (1-2 months of rent), guarantor company fee (which could be 0.5-1 month of rent), and the agent's fee (another 1 month of rent). 2) It was quite shocking to hear that even if your property is destroyed in a natural disaster, you might still be on the hook for mortgage payments or for fixing land subsidence out of pocket. Is that pretty standard across home insurance policies in Japan to have those exclusions? Or can you buy more insurance to make sure that you're 100% covered in the event of any natural disaster?
Many places don't charge reikin any more, and other fees can be flexible. But multiples of monthly rent don't come close to 5-10% of the property value of course. You'd have to check the details of any insurance policy. Those are just anecdotes from the experiences of people around me. The point is to not assume that you will be completely covered...
@@TheWave251 yeah - that's been my experience in Tokyo too. I almost was about to move forward with applying for a couple of places that advertised 0 key money, but ended up having some serious drawbacks - such as being located next to some major construction that was about to begin or being on the 3rd/4th floor of a building that had no elevator and a really narrow staircase.
My wife is Japanese and we are looking at possibly buying a second hand home in somewhere like Chiba next year whilst the yen is weak. We live in the UK. I’ve had nightmare neighbours in England and you mentioning having ‘psycho’ neighbours is really putting me off the idea 😂! Maybe renting would be the better option.
Don't let me put you off, I might have just been unlucky! But I have friends who had similar experiences. The problem neighbours that seem most common are people with mental or antisocial behaviour problems -there are a lot of mentally ill people in Japan, and they don't always get proper treatment. Definitely check out the neighbours and ask around if you're thinking about buying 😅
11 years lives at apartment - Not a single yen rent have been increased. Except some personal repair. Two parking lot with 2LDK less than 50,000yen near FUKUOKA. Can you imagine? Though, i can able to buy house but still feel comfortable with renting.
I'm curious what happens if you buy a mansion in a building, and then that building gets sold to be demolished? Does the developer approach every individual owner and then about what percent of the original or current value does each owner recover?
That's what I understand it to be. I own my ground floor apartment in a block that has about 10 apartments in total. I think only 3 or 4 are actually owned out of those 10. Whoever it is has to buy us out and we will not compromise.
Thanks for the video, mate! I'm American-My wife and I are renting near Tokyo and it's very pricey (160,000). She wants to buy a HOUSE I'd rather buy a mansion. I'm worried a big earthquake might hit and destroy a house but our rent is too high
There are certainly benefits and drawbacks for both houses and manshons 😃 I would definitely recommend doing as much research as possible. Start checking real estate listings to see what kind of properties you have available at various price points.
Don't forget maintenance, transaction costs, and the opportunity cost of the money 😉 But for most people it will be cheaper to buy as long as they live in the place for a decade or two.
Since I started watching the videos on buying houses in Japan, I've developed some interests in buying a house there. I'm an American citizen and if I decide to buy a house in Japan, I will very likely pay cash outright. But my question will be if there are some areas in Japan that are Earthquakes free. I would not like to entertain the thoughts that if I buy a house there it may be destroyed by Earthquake one day. So, in terms of Earthquakes, are there some areas in Japan that are safer than others? Please comment! This video was to some degree very informing especially on pros and cons.
Possibly but Japan is basically sitting on top of multiple plates so earthquakes are possible everywhere. Happily though, modern Japanese buildings are extremely quake resistant. Of more concern are landslides, flooding, and tsunamis, but these are easier to predict and you can get 'hazard maps' from local governments that show which areas are at risk. You should definitely look into that before buying.
Thanks for this video. True that a home in North America will appreciate over time, but over that time a lot more money will have gone into interest on a mortgage. Also, with this recent bought of inflation, it costs more to build a basic tate-uri house, so they are selling for a little more now. I am wondering how this will affect the re-sale price of existing homes.
Probably depends on demand in the specific area! There was a really nice house for sale near us that we liked but couldn't quite afford (40m or so). We later learned the owner sold it to a developer for half that as they were in a hurry 😭
Do you have any information about current interest rates for mortagages in Japan? Please excuse my ignorance. I am familiar with US mortgage rates, but not so much Japan. I just filed my application for COE in December. Waiting to eventually apply for the spousal visa.
That is the million dollar question, eh? One of the biggest risks with buying is having an unpleasant neighbor or local environment. Best would be to live there first (we were able to but this is very much not normal). Second best to live nearby so you can see what things are like locally. Third would be to visit at different times of day, maybe try to say hi to the neighbors, check noise and traffic and stuff like that.
In good areas renting is always cheaper than buying. In 23-wards Tokyo you can rent a decent/nice place for 150,000. Try to get a mortgage for that amount... you'll be living in either an extremely old (pre-revised earthquake standard) or in a truly terrible location.
Already bought 2 will buy 4 or 5 more. Can make money from business and stocks It is just a possession like a pair of shoes Made my first million over 20 years ago. I buy whatever I want. Dont care what others think I should or shouldnt buy. Spend 50x as much on stocks and business. I own it I can do whatever I want Sell it if I want but I am in control. The costs are neglible compared to America.
Health insurance is mandatory in Japan for all residents. It costs the same for Japanese people and non-Japanese people. It's based on your income, so the more you make the more you pay, up to a monthly cap.
Great video as always! Currently in process for buying apartment in Fukuoka after renting for 7 years. Apart from the mandatory fire insurance, are you using/recommending other house insurances?
I think homes in Japan will appreciate, at least the ones foreigners buy, they will likely upgrade or renovate the home. I think foreign buyers of Japanese homes would target foreigner sellers should they decide to sell. Does the Japanese government provide financial assistance like grants to homes damaged due to natural disasters?
Earthquakes are a big reason for me not to buy. In most countries the only thing that might cause catastrophic damaget is a fire. And they're also a lot more prevalent here, due to all the wood, tatami, fusuma, kerosene stoves, etc. A friend of mine had to sell his house in a hurry and go back home. He'd had it built only three years before, and got back about a third of what he'd paid for it. That's also stayed with me as a good reason not to buy in Japan.
So I see vids that houses built from 1981 are under earthquake #5, but it’s best to be under earthquake #6 and #7. How much would it cost if you renovate a home that you just purchased?
Hey, thanks for the video very useful. Would you say that (from what you've seen) is purchasing a home outright usually easier than trying to negotiate with landlords when renting? I can imagine they don't really have a reason to turn you down when you're going to take it right off their hands and they can forget about it.
I'm sure there might occasionally be an issue when buying as a foreigner, but I have never heard of one (have personal experience and numerous stories from others of being refused rental accommodation for no reason). As long as you have the cash or can get a mortgage it should be smooth enough.
Currently I have 5 Houses/Apartments in Japan all bought new and all less than 10 years old. 3 in Tokyo and 2 in Nagano. So far none have dropped in value especially the Tokyo apartments. All of the Homes I lived in for a minimum of 2 years before moving to the next one. Regarding the invalidating Mortgage in reality despite that being in the contract none of the Banks cared when I moved and switched them to Rental properties. All I had to do was prove I'd lived there a few years and give a clear reason for the move. Usually work, family elationship related etc etc. Once I informed the Banks which are all Mega top 4 Banks all they needed was an update of my new address. Do you actually know of anyone that's had their Mortgage cancelled etc suddenly? I think like many things in Japan they avoid confrontation and as long as the Mortgage is paid on time they don't really enforce the rules. It was also no barrier to me in getting additional Mortgages BTW.
That is really interesting. Were the mortgages converted to commercial ones? My bank (small regional one) was very clear that it would not be possible to have more than one residential mortgage, so we'd have to pay off the current one to get a new one.
@@RetireJapan_OGWould you be able to move your mortgage from the small regional bank to a large one ("Mega top 4" as mentioned above) if you were interested in doing so?
@@RetireJapan_OGno they weren't converted. Mega Banks such as MUFJ, Sumitomo, MIZUHO and Resona all understand that people have to move for various reasons and despite having similar rules didn't enforce them. I suspect if I hadn't lived in the places and obviously knowingly obtained a residential Mortgage for commercial purposes they would have been less understanding. Currently of the five places 1 is Mortgage Free, 2 are regular Home Mortgages, 1 Second House Flat35 Loan and 1 is a Commercial Loan. The Second House Loan is the only one which I can't Rent out or use for Business purposes etc.
@@shannonford5298 Hat tip to you, sir. I had no idea that was possible. I guess your income must be substantial to meet the requirements for multiple mortgages. So only two of them are regular mortgages, eh? That is still one more than I thought was possible 😅
@@RetireJapan_OGyes 20m to 30m yen most years. I've had Real Estate agents tell me the limit for Home Mortgages is two. After that second House Loans etc are necessary.
Can you airbnb your apartment or house for short stays under residential home loan? Also, i hear often from real estate dealers that, in case someone does not want to live in the property he took loan for, can be rented out by the agent, like in the case 2 years foreign assignment. Would appreciate your input and thanks for the insightful video!
Depends on the terms and conditions of your mortgage, and whether your bank notices. Lots of moving parts. Technically it is not possible to rent out a property if you have a residential mortgage, but you can ask the bank for permission and many people seem to just ignore this.
No brainer, just buy near the center of the city and build for earth proof. Excellent points - thanks for sharing. Or just live for feasibility. Question, is thee Earth quick insurance ?
I had no idea about the transaction costs. 10% is crazy. Also, what would you say are the benefits of 町内会？ I had a knock at my door and was asked to join. I asked what a 町内会 does and they couldn’t answer. Just give me 3000 yen please.
Depends on the association. Could be local events, parties, clean-ups/beautification, etc. I joined and am now the vice chair. (It's 3000 for the year).
Do you see foreign investors buying homes there just to rent out as Airbnb or just lease out on their own? I don’t have a visa to stay long term, but I could lease it out for 6 months each year should I buy a home.
@@RetireJapan_OG I would be targeting tourists for leasing. Also if I decide to sell, I would target foreigners. This is the reason why I think certain homes in Japan can appreciate despite property values decreasing typically. A newly renovated home or brand new home I think would sell well to foreigners who have the money. Foreigners targeting foreigners for rental or sale I think will do well. Who are snatching up akiyas? Certainly not locals.
Great topic and video, thanks! I have been up in the air about buying or renting, but have now rented a house for 18 years and an apartment for 9. Buying seems to have been better, buy now so much time has passed. But now I'm thinking of renting or buying a nicer place. Anyway, I don't think the idea of buying with the intent on renting or selling later (or if necessary) was discussed in detail. People say houses lose their value and are worth nothing, but there are tons of houses older than 30 years that selling for 25,000,000 to 50,000,000 yen! There aren't any cheap old houses I can find that aren't dumps, even well outside of an urban area. Seems like a good plan would be to buy a house under 10 years old, live in it for 10 years or more, than rent it out or sell it off . . .
Really depends on the property, so you would need to run the numbers to see what makes sense. Our manshon was a steal to buy, but renting it out at market rates wouldn't make much sense (we'd do better to just sell it). For other properties the opposite might be true. Or neither being a good option.
A house owned free and clear is yours. But your bank deposits, investments, and even pensions are subject to substantial financial system risks, such as high inflation, bank bail-ins of depositors money, derivatives exposure at your broker or bank, unfunded pension liabilities, etc. These risks are substantial and growing. Just because the financial system has been safe for your whole life so far, does not mean that it will be in future. If you reflect carefully on your analysis, you will realize it ASSUMES financial stability. Renters will live in their cars if that assumption does not hold...
@@RetireJapan_OG Given that there have been substantial financial system failures in: 1929, 1907, 1857, 1825.1792, 1720, etc, the starting proposition of Yet Another Financial System Failure is not so far fetched. You just have not seen one during your lifetime. So... go stand beside any Japanese tsunami tablet ( "A warning to our descendants: Do not build houses lower than this tablet") and just look down the hill. All the houses below were built by those who have never actually seen a tsunami and therefore discount that risk...) Also wrong is the idea that everyone is in trouble (equally). People with a House & Garden are far better positioned than those with a Job or Assets & Rental Housing. If you lose your job, or the bank ties up your assets, like in 1932, then your whole house of cards comes tumbling down. It really happened just like that to many millions of Americans during the Great Depression. (Read: Hard Times: An Oral History of the Great Depression by Studs Terket.) And these factors do not impact Rent vs Buy? Really? (Perhaps for non-readers or non-thinkers, I suppose...)
That 30 year time frame has already been crushed and the mindset has shifted with current building codes. If you custom build your house, it no longer follows that metric. Just DON'T build to Japanese minimum standards. Houses are cheap in Japan because they are built that way and thus the old mindset of 30 years. Just remember 70's Japanese cars for the export market and the rusty crap they were after five years. That mindset changed because 'shaken' and the 'new' economy wasn't a thing outside of Japan.
Lots of good points.
I built a home in Japan and don't regret it. While the house itself loses value, good property definitely has resell value in many parts of the country. But the biggest advantage is better QoL, not finances. Fully insulated, heated flooring, higher ceilings, solar panels (with energy prices the last few years, especially glad I have them) and being able to freely renovate both interior and exterior, as well as not having to worry about noise issues below, above or next to us. From a financial perspective, fully owning your own place seems much better once you are a pensioner/retired and on a fixed income as you have more control over costs.
Absolutely. I have big plans for when we move into my wife's parents' place eventually: solar, batteries, water catchment tanks, growing our own food... 🤩
Great video, thanks Ben. Just wanted to mention that if you have pets and want to rent, it can be challenging. Specifically for dog owners - if you're looking to rent an apartment/mansion, they may allow you to have a small dog (under 10Kg). If you have a "big" dog (big dog in Japan would be considered a medium size dog in North America), over 10Kg, then you'll probably have to find a house. And even with a house, most rentals will only allow the dog to stay outside.
That's a great point. Wanting a large pet might tip the scales in favour of buying!
There are apartments you can rent in Japan which are specifically designed for pet owners being equipped with things like ventilation that can handle fur, but you do pay a premium for that.
That is exactly why I bought my flat (two months ago, actually). I have two small rescue dogs and I was sick and tired of crying every single time I had to move to a new place (imagine, foreigner plus two dogs...). I was also tired of living in very old and dark apartments while being charged a lot for rent, so now I have a much cheaper mortgage and a wonderful new flat with amazing light and view. Totally worth it for me. It might be emotional, as Ben said, but really, isn't life about trying to be happy?
I bought an apartment in japan, and for me it is the best of the two world. You can save up the rent and the depreciation is not so fast like a house. If you are planing to stay few years in japan but not all your life, buy an apartment can be a good choice. And buy an new apartment is better as well because you save up some tax and some fee.
Definitely an option!
Buying a new apartment (マンション) is no no in Japan. It is same as buying a new car, the moment you bought a new car the car value drops 30%. When you are buying a new apartment you are paying 30% profit to the builder.
@@lutherjr2646 no it is not true, the value doesn't go down just after buying, it is decreasing but not so fast. And in my case after 3 years living in my appartement I can sell it 20% more
@@jonathanpretre6864 lol my click bait worked. As you said not so quickly decreases the value of an apartment, but it decreases faster during first five years then gradually decrease up to 10 years, then again decreases more slowly after that. And as you already know this does not apply during years since the pandemic as the apartment prices skyrocketed from that time. Experts are saying this trend will continue few more years as developers have already purchased the lands in Tokyo area with high prices and the construction materials costs are increasing so fast because of inflation and also the labor costs are increasing because of the labor shortages. There are still demands in the central Tokyo area now, but this upward trend will end by 2030 an expert said because there will be so many vacant apartments and houses as baby boomers will start dying more quickly from that time on. I learned about these because I was going to buy an apartment for myself, but it is insanity to buy an apartment right now even in other metropolitan areas in Japan knowing the prices will start dropping in few years.
Would love a video talking about the taxes and fees /annual taxes fees that needs to be paid with owning a house
That is a great idea, thank you.
Another considerable cost in buying a house is the cost of renovation and maintenance that is often “built in” with system kitchens and system bathrooms. Our house was six years old when we bought and had already depreciated 50%, however now-15 years after our purchase-we have to spend 4.5 million to 5 million yen on the system bathroom (can’t just repair a few things -the entire unit MUST be replaced) and the paint on the house.
But we will never see that money back because by the time we try to sell-if we can sell-the house will be worth nearly nothing.
In my opinion this is a ridiculous situation.
Really good point. We got a custom kitchen for our place a couple of years ago -it was... expensive.
Painting is easy. Why can't you do it yourself?
This English help guide rare and even the Japanese guide doesn’t explain the Mortgage change if I decide to rent the place! thanks alot!!😊
Good to hear it was helpful!
I think another advantage of renting is that especially if you have kids, you can adapt the size of your housing when they leave. However it is very hard to rent when you reach 65-70 years old, most landlord will fear you could die in the rented property which would make it almost impossible to rent again.
That is another vote for flexibility. We used to rent an enormous 100 tsubo house when we had three teenagers but now that they have all moved out my wife and I are perfectly happy with a 3LDK manshon.
@@RetireJapan_OGActually I did buy my apartment in Kawasaki 10 years ago. I still think that despite depreciation if you live in the exact same place for long, it is worth it and still kind of an investment. However we might need to move to Yokohama for a couple of years and I think I would rather rent a place then but keep our current apartment or resale it for reasons you explained in your video 😊
Interesting!
Nice points, Ben. As someone also mentioned, the ability to have pets is another plus for buying. Would love to see a video on the pros/cons of building a house in Japan. We're building with Ichijo and while we may not even retire here and want to sell in 5-7 years, we'd rather have a nice place to live and hopefully won't lose too much, if any. As you mentioned, buying/renting isn't strictly a financial decision, but we couldn't afford, let alone find, a comparable place.
Ichijo are great. Some limitations, but excellent quality for a decent price.
We got as far as almost signing a contract with them, but had to cancel at the last minute (we couldn't get permission to rebuild on the land).
Am 65, currently rent is covered by company, planning to take over the rent next year when retire. Landlord might not accept, offered them to buy, since like the place , but ownership is in multiple persons. In short, after 65 in Japan without owning the place is a worry. Although I heard if I have enough means , I can secure the guarantor, all then comes to landlord willingness … great video!
Yes, there are more options now with guarantor companies, etc.
I have read articles saying the government is aware of the 'elderly difficulty in renting' issue and is working on improving it too.
If you had 3 psychotic neighbours, unusually bad luck, but I feel like you should tell us the addresses so we don't buy your former homes which are no doubt deeply discounted.
Ha, ha, fortunately I was renting at the time 😉
Lots of great information on your channel as well as in the comments section. I’m American, my wife’s Japanese, and we’re considering moving to Japan after I retire. My wife is about 10 years younger and will keep working a while. I’ve always preferred buying a home instead of renting in America. On the fence about buying or renting in Japan given the differences there. So this gives me food for thought.
Good to hear it was helpful!
My wife wanted to live in her hometown. We rented for years but finally bought a condo in 1995. I thought it would be good protection for my wife if something happened to me. I paid it off early because I didn't want to be paying when I was retired. Only thing I didn't plan for is my wife passing away earlier this year. I have added earthquake insurance recently.
Thank you for being so informative and clear, and speaking like a real person who's not hyping one point of view. I'm about to move to Japan for work, and I'd eventually like to buy my own home. Some of the cheap prices are attractive and get my hopes up. I know there are pros an cons, and you answered my basic questions.
My pleasure. It is a nuanced issue, and different people are going to come to different conclusions. Good luck with the move!
I've always rented, but like most long-termers in Japan, I've often pondered the buy vs rent conundrum. One thing in favour of renting that, surprisingly, never gets mentioned is that rents don't go up, unlike the countries where most of us are from.
Before signing the contract for my house I asked if the rent would go up, and the fudousan man looked confused, as if he didn't quite understand. 16 years later I'm still paying the same rent.
That is another advantage of living in Japan, for sure 😃
I'm not a fan of the recontracting fees we often have here in Sendai though.
What are they? I've never heard of them.@@RetireJapan_OG
What are recontracting fees?@@RetireJapan_OG
I've been bingeing on your videos and really, they need to be a standard 101 for anybody looking to live and work here.
We decided to buy having found a fully furnished, "display" apartment, in a relatively new smallish complex, that was completely renovated on the ground floor, 5 minutes from a major station on foot, with a nice park out the back and plenty of space for us inside - 3LDK is more than enough. And at the price we got it for 6 years ago, it was a real bargain as the surrounding area has exploded with a dozen tower buildings and that has only pushed the price of our place to almost double what we paid on the mortgage if we ever wanted to sell.
I still get peeved remembering we have to pay a monthly 800yen surcharge to the city council for having access to the "garden space" out back since that wasn't on the zoning plans and the council makes us do all the gardening!
If you don’t mind me asking, how much roughly are the fees you have to pay in an apartment block in Japan?. I live in the UK and we pay management fees and ground rent which are often a real rip off. Just wondering if it is similar or more reasonable in Japan. As my wife is Japanese we hope to secure a flat/house in Japan at some point.
Thanks for posting this.
Lots of pros and cons for both situations.
We own our house but we don't own the land, which is a situation peculiar to Japan I suppose.
In our case, our landlord is a fantastic family, (we have known them for more than 40 years) so we are very lucky.
My daughter and son-in-law did a major renovation on the main house when they decided to come back and live here, when my daughter wanted to go back to full-time work after time off for having two children. I now live in the hanare, a separate building. So for me, this is a good situation although there are pros and cons. All in all, I enjoy living with the grandchildren and helping out when I can, which is actually quite a lot. And we can also have a large dog without any issues. Luckily we didn't have any major damage in the 2011 earthquake.
Sounds like you have a good setup! We have something similar, live in a manshon and my daughter and grandkids live in the manshon next door ^-^
Best of both then! ❤
Also thinking about buying vs renting. One thing that is bothering me for buying an apartment in a condominium when looking around prices is the "kanri fee" and "repair provision fee". These together can sometimes be like half the rent fee you would pay or ask for the place... It is like renting your own apart for half the fee... Houses do not have this problem... But some day a big repair might show up...
Yes, very important to be aware of any fees.
Manshon kanrihi pays for cleaning, staff, electricity for lighting and elevators, etc.
Repair fund pays for repairs, maintenance, upgrades.
If you own a house you are responsible for repairs and maintenance (also important to be aware of those fees).
I’d rather buy a home for $150,000 in japan that depreciates than have a $800,000 loan for an average house in Australia - no question.
There are some big advantages to the Japanese real estate market: young people and normal families can afford homes, even in cities.
Thanks for the video!
I would add that it also depends on the location. Some popular places in Tokyo are overpriced in my opinion. So renting in those areas would be a good option and use that money for something else like investing.
Always worth running the numbers before making a decision 🙂
My wife owns and rents out a flat in Tokyo. If the building collapses or some such thing, each owner of a flat there owns a corresponding piece of the land on which the building was built and it was built on the highest grade assessed land. Make sure you research and have surveyed the land quality grade if buying. Grades start from Grade A B C etc.
Definitely a good idea to check the official hazard map etc. before buying 😀
Not related but if you live in Tokyo, the Tokyo Gov will pay the school fees for all private school fees from April this year….this is not a typo!@@RetireJapan_OG
@@carollynt Is this comment founded in your actual experience ?
@@carollynt Otherwise, your comment is entirely unhelpful and quite possibly defamatory
A benefit of buying is that you no longer need to deal with estate agents again unless you want to sell. Typically rents are 2-year leases and you then have to extend and manage the estate agent again. Obviously personal choice but avoiding any dealing with an estate agent here in Japan is a major plus point for me since I find them universally loathsome…
That is a very good point. Kind of like getting PR and not having to deal with the immigration office any more, buying a home and not having to deal with estate agents is a major plus :)
We bought a condo which I feel is totally different to buying a house. The depreciation is nowhere near that on a house and if you choose wisely can actually increase in value.
We were paying around ¥250,000 a month in rent for a crappy apartment. Having a dog drastically reduced the options available.
buying allowed us access to a hell of a lot more apartments and we could choose what suited us the most. Buying for us was a no brainer. Spending money on rent you are 100% never getting that money back, as well as the key money, but with a condo there’s a good chance you’ll get a decent amount back if you choose wisely. For us I think depreciation will be a lot lower than what we would have spent on rent for a similar place to what we bought.
We only live here for a few months a year but it’s still better for us to have our own home here and gives us much more flexibility coming and going plus it means we have a place to call our home and can do whatever we want on the inside.
Sounds like you found a good solution for your needs 😀
Hi, I only visited Japan 2x and have not left my heart since, your exact ideas of having a place to live in for any amount of time as you please and leave when you need change is what I have discussed with my husband, were on our 50's, not close to retirement working in the US, no plans of working in Japan, just love to learn their cultures and when we need "restfull" month stay, do you mind sharing your agent you used or your journey and current place of your "home" plssss, outside of Tokyo? Osaka? Hiroshima?
Thanks @WylieWestie
@@RetireJapan_OGthank you for great informations, do you mind recommending an agent that I can use pls, what do you think of the places like Chiba or Omori or Otsuka?? Outside of Tokyo but not far away through trains
@@dsua471 we live in Tokyo and used remax 😀
If you are a foreigner it is hard to rent in many places which might make it easier to just buy rather than rent.
Very good point! Many people get tired of the hassle around renting and buy once they are ready to settle down.
Running into the landlord refusal (specifically because I was a foreigner I was told) was a bit of a shock. I'd stayed at two different properties in Hokkaido (1 apt, 1 rented house) and an apartment in Tochigi and never had a problem. So coming up against it in Miyagi was an eye-opener (maybe I'd gotten lucky over the previous 10 yrs or so?). I argued "差別" and was given extra hoops to jump through, but was able to rent. It's been the worst rental experience I've ever had in my life (wasn't a lot of options after 2011). Thinking about trying to find an 空き家 at this point.
Yeah, I was trying to rent a house in Sendai (haven't had trouble with apartments) for my family in 2004. I had a government job with the Kencho, a Japanese wife and family and we got turned down 30+ times. Only found somewhere through one of my wife's friends in the end.
Not a good experience.
Interesting, I had no real issues doing the same circa 2015. Visited many properties with 4 different agencies and ended up getting a decent one not far from Sendai Station. I was turned down once I think as the owner wanted someone more long-term than my year-to-year contracts.
Owners can do things that might be prevented by landlords, such as smoking, having large pets, being too young or too old, being gaijin, having a medical disability or even a preexisting condition, being too tall, being too fat, only having an N4 JLPT, waving at people in a friendly manner, etc. Also, Ben, why Sendai? Have you ever made a video about that? I've been to Sendai, lovely town no doubt about it, demo ...
Ha, ha, I will fight to the death to defend Sendai's honour 😃
Will definitely make a video about that -thanks for the idea!
We pay about half in our mortgage payment as we would in rent. But we do lack the flexibility of renting.
I think our housing costs are roughly 60% of renting 😃
@@RetireJapan_OG I used to pay 65,000 per month for my mortgage, and I am now paying 70,000 per month for my brand new "manshon"-type apartment. Not much in it at all.
@@tonyalderman7600 That's definitely a great deal, as you get to avoid maintenance, fees, property tax, etc. 😀
Thanks Ben for the very information video. A couple of questions: 1) you mentioned the transaction costs with buying/selling property. How do they compare to the transaction costs associated with changing rental properties though? I just recently relocated to Japan and got quite the wake-up call with having to pay rei-kin (which could be 1-3 months worth of rent depending on the place), deposit (1-2 months of rent), guarantor company fee (which could be 0.5-1 month of rent), and the agent's fee (another 1 month of rent). 2) It was quite shocking to hear that even if your property is destroyed in a natural disaster, you might still be on the hook for mortgage payments or for fixing land subsidence out of pocket. Is that pretty standard across home insurance policies in Japan to have those exclusions? Or can you buy more insurance to make sure that you're 100% covered in the event of any natural disaster?
Many places don't charge reikin any more, and other fees can be flexible. But multiples of monthly rent don't come close to 5-10% of the property value of course.
You'd have to check the details of any insurance policy. Those are just anecdotes from the experiences of people around me. The point is to not assume that you will be completely covered...
@@TheWave251 Fair enough! Not everyone lives in Tokyo though 😉
@@TheWave251 yeah - that's been my experience in Tokyo too. I almost was about to move forward with applying for a couple of places that advertised 0 key money, but ended up having some serious drawbacks - such as being located next to some major construction that was about to begin or being on the 3rd/4th floor of a building that had no elevator and a really narrow staircase.
My wife is Japanese and we are looking at possibly buying a second hand home in somewhere like Chiba next year whilst the yen is weak. We live in the UK. I’ve had nightmare neighbours in England and you mentioning having ‘psycho’ neighbours is really putting me off the idea 😂! Maybe renting would be the better option.
Don't let me put you off, I might have just been unlucky! But I have friends who had similar experiences.
The problem neighbours that seem most common are people with mental or antisocial behaviour problems -there are a lot of mentally ill people in Japan, and they don't always get proper treatment.
Definitely check out the neighbours and ask around if you're thinking about buying 😅
11 years lives at apartment - Not a single yen rent have been increased. Except some personal repair. Two parking lot with 2LDK less than 50,000yen near FUKUOKA. Can you imagine? Though, i can able to buy house but still feel comfortable with renting.
Sounds like you have a good situation! Make sure to save and invest the money you are saving by having a reasonable rent 😉
I'm curious what happens if you buy a mansion in a building, and then that building gets sold to be demolished? Does the developer approach every individual owner and then about what percent of the original or current value does each owner recover?
That's what I understand it to be. I own my ground floor apartment in a block that has about 10 apartments in total. I think only 3 or 4 are actually owned out of those 10.
Whoever it is has to buy us out and we will not compromise.
Thanks for the video, mate! I'm American-My wife and I are renting near Tokyo and it's very pricey (160,000). She wants to buy a HOUSE I'd rather buy a mansion. I'm worried a big earthquake might hit and destroy a house but our rent is too high
There are certainly benefits and drawbacks for both houses and manshons 😃
I would definitely recommend doing as much research as possible. Start checking real estate listings to see what kind of properties you have available at various price points.
Thank you for this video. Planning to buy a house this year or next year. 😀
Thank you for your insight, it was very helpful
My pleasure! Let me know if you have any questions.
to me it comes down to 1) pay rent every month, or 2) pay property taxes every year. which comes out to be the cheapest? this is why i chose #2.
Don't forget maintenance, transaction costs, and the opportunity cost of the money 😉
But for most people it will be cheaper to buy as long as they live in the place for a decade or two.
Since I started watching the videos on buying houses in Japan, I've developed some interests in buying a house there.
I'm an American citizen and if I decide to buy a house in Japan, I will very likely pay cash outright. But my question will be if there are some areas in Japan that are Earthquakes free. I would not like to entertain the thoughts that if I buy a house there it may be destroyed by Earthquake one day. So, in terms of Earthquakes, are there some areas in Japan that are safer than others? Please comment!
This video was to some degree very informing especially on pros and cons.
Possibly but Japan is basically sitting on top of multiple plates so earthquakes are possible everywhere.
Happily though, modern Japanese buildings are extremely quake resistant. Of more concern are landslides, flooding, and tsunamis, but these are easier to predict and you can get 'hazard maps' from local governments that show which areas are at risk. You should definitely look into that before buying.
Thanks for the useful content
My pleasure! Let me know if you have any questions, it helps me make new videos ^-^
Thanks for this video.
True that a home in North America will appreciate over time, but over that time a lot more money will have gone into interest on a mortgage. Also, with this recent bought of inflation, it costs more to build a basic tate-uri house, so they are selling for a little more now. I am wondering how this will affect the re-sale price of existing homes.
Probably depends on demand in the specific area!
There was a really nice house for sale near us that we liked but couldn't quite afford (40m or so). We later learned the owner sold it to a developer for half that as they were in a hurry 😭
Do you have any information about current interest rates for mortagages in Japan? Please excuse my ignorance. I am familiar with US mortgage rates, but not so much Japan. I just filed my application for COE in December. Waiting to eventually apply for the spousal visa.
Floating rate as low as 0.4%, fixed rate more like 1% or so 😀
Bought my current apartment just after the earthquake for 29 mill yen. It’s now worth about 50 mill yen. I’ve got about 20 mill left on the loan.
Seems like that worked out quite nicely for you 🤩
Any tips on how to find a good location? And The crazy neighborhood it happened to one of my friends, any tips to avoid this?
That is the million dollar question, eh? One of the biggest risks with buying is having an unpleasant neighbor or local environment.
Best would be to live there first (we were able to but this is very much not normal).
Second best to live nearby so you can see what things are like locally.
Third would be to visit at different times of day, maybe try to say hi to the neighbors, check noise and traffic and stuff like that.
In good areas renting is always cheaper than buying. In 23-wards Tokyo you can rent a decent/nice place for 150,000. Try to get a mortgage for that amount... you'll be living in either an extremely old (pre-revised earthquake standard) or in a truly terrible location.
Now 2024, is it still worth investing in a house or condo and leasing it out? What kind of returns can u expect?
It will depend on the local situation. You need to run the numbers for the property in question.
Already bought 2 will buy 4 or 5 more. Can make money from business and stocks It is just a possession like a pair of shoes Made my first million over 20 years ago. I buy whatever I want. Dont care what others think I should or shouldnt buy. Spend 50x as much on stocks and business. I own it I can do whatever I want Sell it if I want but I am in control. The costs are neglible compared to America.
I think I will just inherit a house and some rentals from my wifes mother. Should make everything a bit easier! Cheers!
That is certainly a lot easier 😂
Very informative and many thanks. But where are the links re mortgage specialist you mentioned? Thank you
In the description 😃
But also here: ruclips.net/user/liven-N1fwNge4c?feature=share
👍🏻
Do you have a health insurance? If so, how much does it cost for foreigners?
Health insurance is mandatory in Japan for all residents. It costs the same for Japanese people and non-Japanese people. It's based on your income, so the more you make the more you pay, up to a monthly cap.
Great video as always! Currently in process for buying apartment in Fukuoka after renting for 7 years. Apart from the mandatory fire insurance, are you using/recommending other house insurances?
I think we just have fire and earthquake insurance!
I think homes in Japan will appreciate, at least the ones foreigners buy, they will likely upgrade or renovate the home. I think foreign buyers of Japanese homes would target foreigner sellers should they decide to sell.
Does the Japanese government provide financial assistance like grants to homes damaged due to natural disasters?
Earthquakes are a big reason for me not to buy. In most countries the only thing that might cause catastrophic damaget is a fire. And they're also a lot more prevalent here, due to all the wood, tatami, fusuma, kerosene stoves, etc.
A friend of mine had to sell his house in a hurry and go back home. He'd had it built only three years before, and got back about a third of what he'd paid for it. That's also stayed with me as a good reason not to buy in Japan.
Good points. Earthquake insurance doesn't always pay out in full too.
So I see vids that houses built from 1981 are under earthquake #5, but it’s best to be under earthquake #6 and #7. How much would it cost if you renovate a home that you just purchased?
Hey, thanks for the video very useful. Would you say that (from what you've seen) is purchasing a home outright usually easier than trying to negotiate with landlords when renting? I can imagine they don't really have a reason to turn you down when you're going to take it right off their hands and they can forget about it.
I'm sure there might occasionally be an issue when buying as a foreigner, but I have never heard of one (have personal experience and numerous stories from others of being refused rental accommodation for no reason).
As long as you have the cash or can get a mortgage it should be smooth enough.
Thanks! @@RetireJapan_OG
If a home was built before 1981, but renovated last year, would it be considered earthquake or Shingo proof #6 or #7?
Currently I have 5 Houses/Apartments in Japan all bought new and all less than 10 years old. 3 in Tokyo and 2 in Nagano.
So far none have dropped in value especially the Tokyo apartments. All of the Homes I lived in for a minimum of 2 years before moving to the next one. Regarding the invalidating Mortgage in reality despite that being in the contract none of the Banks cared when I moved and switched them to Rental properties.
All I had to do was prove I'd lived there a few years and give a clear reason for the move. Usually work, family
elationship related etc etc.
Once I informed the Banks which are all Mega top 4 Banks all they needed was an update of my new address.
Do you actually know of anyone that's had their Mortgage cancelled etc suddenly?
I think like many things in Japan they avoid confrontation and as long as the Mortgage is paid on time they don't really enforce the rules. It was also no barrier to me in getting additional Mortgages BTW.
That is really interesting. Were the mortgages converted to commercial ones?
My bank (small regional one) was very clear that it would not be possible to have more than one residential mortgage, so we'd have to pay off the current one to get a new one.
@@RetireJapan_OGWould you be able to move your mortgage from the small regional bank to a large one ("Mega top 4" as mentioned above) if you were interested in doing so?
@@RetireJapan_OGno they weren't converted. Mega Banks such as MUFJ, Sumitomo, MIZUHO and Resona all understand that people have to move for various reasons and despite having similar rules didn't enforce them. I suspect if I hadn't lived in the places and obviously knowingly obtained a residential Mortgage for commercial purposes they would have been less understanding.
Currently of the five places 1 is Mortgage Free, 2 are regular Home Mortgages, 1 Second House Flat35 Loan and 1 is a Commercial Loan.
The Second House Loan is the only one which I can't Rent out or use for Business purposes etc.
@@shannonford5298 Hat tip to you, sir. I had no idea that was possible.
I guess your income must be substantial to meet the requirements for multiple mortgages.
So only two of them are regular mortgages, eh? That is still one more than I thought was possible 😅
@@RetireJapan_OGyes 20m to 30m yen most years. I've had Real Estate agents tell me the limit for Home Mortgages is two. After that second House Loans etc are necessary.
Can you airbnb your apartment or house for short stays under residential home loan?
Also, i hear often from real estate dealers that, in case someone does not want to live in the property he took loan for, can be rented out by the agent, like in the case 2 years foreign assignment.
Would appreciate your input and thanks for the insightful video!
Depends on the terms and conditions of your mortgage, and whether your bank notices. Lots of moving parts.
Technically it is not possible to rent out a property if you have a residential mortgage, but you can ask the bank for permission and many people seem to just ignore this.
No brainer, just buy near the center of the city and build for earth proof. Excellent points - thanks for sharing. Or just live for feasibility. Question, is thee Earth quick insurance ?
Yes, earthquake insurance is very common.
I had no idea about the transaction costs. 10% is crazy.
Also, what would you say are the benefits of 町内会？ I had a knock at my door and was asked to join. I asked what a 町内会 does and they couldn’t answer. Just give me 3000 yen please.
Derek has a lot to say about integrating with the local community: ruclips.net/user/live0A5retyUoCU?feature=share
Tell me about it. 2000 yen per month when I used to live in my house in the village. It's a piss-take.
Depends on the association. Could be local events, parties, clean-ups/beautification, etc. I joined and am now the vice chair. (It's 3000 for the year).
Do you see foreign investors buying homes there just to rent out as Airbnb or just lease out on their own? I don’t have a visa to stay long term, but I could lease it out for 6 months each year should I buy a home.
I think that would be a very bad idea for most people 😅
There's a reason Japanese people don't want those houses.
@@RetireJapan_OG I would be targeting tourists for leasing. Also if I decide to sell, I would target foreigners. This is the reason why I think certain homes in Japan can appreciate despite property values decreasing typically. A newly renovated home or brand new home I think would sell well to foreigners who have the money. Foreigners targeting foreigners for rental or sale I think will do well. Who are snatching up akiyas? Certainly not locals.
Everything in life is a depreciating asset and will disappear eventually.
Great topic and video, thanks! I have been up in the air about buying or renting, but have now rented a house for 18 years and an apartment for 9. Buying seems to have been better, buy now so much time has passed. But now I'm thinking of renting or buying a nicer place.
Anyway, I don't think the idea of buying with the intent on renting or selling later (or if necessary) was discussed in detail. People say houses lose their value and are worth nothing, but there are tons of houses older than 30 years that selling for 25,000,000 to 50,000,000 yen! There aren't any cheap old houses I can find that aren't dumps, even well outside of an urban area. Seems like a good plan would be to buy a house under 10 years old, live in it for 10 years or more, than rent it out or sell it off . . .
Really depends on the property, so you would need to run the numbers to see what makes sense.
Our manshon was a steal to buy, but renting it out at market rates wouldn't make much sense (we'd do better to just sell it). For other properties the opposite might be true. Or neither being a good option.
I am planning to rent until I find a location I want to live for long term
That is very sensible.
A house owned free and clear is yours. But your bank deposits, investments, and even pensions are subject to substantial financial system risks, such as high inflation, bank bail-ins of depositors money, derivatives exposure at your broker or bank, unfunded pension liabilities, etc. These risks are substantial and growing. Just because the financial system has been safe for your whole life so far, does not mean that it will be in future. If you reflect carefully on your analysis, you will realize it ASSUMES financial stability. Renters will live in their cars if that assumption does not hold...
If your starting proposition is the failure of the financial system, I don't know what to say to you 😅
I think everyone is in trouble at that point.
@@RetireJapan_OG Given that there have been substantial financial system failures in: 1929, 1907, 1857, 1825.1792, 1720, etc, the starting proposition of Yet Another Financial System Failure is not so far fetched. You just have not seen one during your lifetime. So... go stand beside any Japanese tsunami tablet ( "A warning to our descendants: Do not build houses lower than this tablet") and just look down the hill. All the houses below were built by those who have never actually seen a tsunami and therefore discount that risk...)
Also wrong is the idea that everyone is in trouble (equally). People with a House & Garden are far better positioned than those with a Job or Assets & Rental Housing. If you lose your job, or the bank ties up your assets, like in 1932, then your whole house of cards comes tumbling down. It really happened just like that to many millions of Americans during the Great Depression. (Read: Hard Times: An Oral History of the Great Depression by Studs Terket.) And these factors do not impact Rent vs Buy? Really? (Perhaps for non-readers or non-thinkers, I suppose...)
Jim, do you even live here? (Japan) you ever heard of earthquakes? 😅
A financial earthquake is far more likely than a regular one, especially since the world is now more indebted than it has ever been before....
That 30 year time frame has already been crushed and the mindset has shifted with current building codes. If you custom build your house, it no longer follows that metric. Just DON'T build to Japanese minimum standards. Houses are cheap in Japan because they are built that way and thus the old mindset of 30 years. Just remember 70's Japanese cars for the export market and the rusty crap they were after five years. That mindset changed because 'shaken' and the 'new' economy wasn't a thing outside of Japan.
Nah, please tell us more about the psychotic 3 neighbors good sir. We need to know this!
Ha, ha, will consider doing a video about this in the future :)