The present scenario of Real Estate in Japan
After plummeting for two decades and a half, the year 2014 has seen a re-emergence of the property market in Japan with average prices of Condos in Japan hitting an all time high since 1992. If this trend continues, it could mark a turnaround in the long dormant financial fortunes of the world’s third largest economy.
As per the report of Global Property guide, the average price of new condos in Osaka rose by more than 8 percent in June 2013 compared to a year earlier.
Apart from this the resale prices are also rising. The Tokyo Stock Exchange Home Price Index grew 3.3 percent in October from a year earlier. There is a rise in residential construction. Overall, a rise in the Land prices, especially in the metropolitan areas can be seen in Japan. As per Moody’s July 2013 report, Japan’s property market has moved from negative to stable. The table below would give a comprehensive idea (approximate) of the accommodation costs in Japan (1$ = 101¥) –
- Apartment (1 bedroom) in City Centre 103,772.02 ¥
- Apartment (1 bedroom) Outside of Centre 59,651.16 ¥
- Apartment (3 bedrooms) in City Centre 206,167.28 ¥
- Apartment (3 bedrooms) Outside of Centre 122,545.45 ¥
- Price per Square Meter to Buy Apartment in City Centre 558,316.15 ¥
- Price per Square Meter to Buy Apartment Outside of Centre 392,835.27 ¥
Process of Buying Property in Japan
There is no legal restriction on the buying of property by foreigners in Japan. Once the property is chosen, you have to select a real estate agent as most deals are done through agents. The real estate agent can serve as a translator and the negotiations can be started.
- A letter of intent is prepared. However, this is not legally binding.
- Next, a document called Juyoujiko-Setsumeisho is drafted by the real estate agent before the deal, which is the Japanese version of Property Disclosure Statement or seller’s Real Property Disclosure Statement.
- The purchase contract is drawn up after the deal is settled.
- A 10% deposit from the buyer is expected before the contract date.
- The title is transferred during the closing. At this time both parties should have their certificate of seal impression. The required stamps are obtained and the fees and taxes due to government is paid for registering the title.
- After this the remaining balance is paid off.
The whole process for the purchase of the property takes about 12 days to complete and consists of 6 steps.
Rented Accommodation :
One may on the other hand, decide not to buy a property but to make other accommodation plans like renting out a local place or maybe putting up in a hotel as per the length of stay. There are various options available for this as well including Japanese style and western style lodgings along with unconventional accommodation options like capsule hotels and temple lodgings.
Given below is a list of typical styles of accommodation available in Japan with tentative overnight rates.
Japanese Style :
- Ryokan:- A Ryokan is a Japanese style inn consisting of Japanese style rooms. A stay at the Ryokan is highly recommended for all visitors to Japan, as it allows one to get a feel of the Japanese traditional lifestyle. Ryokans usually offer dinner and breakfast with the room and can be rented out for anything between 6000 yen to 30000 yen depending on the kind of facilities that the Ryokan offers.
- Minshuku:- These are Japanese style bed and breakfast lodgings which are usually family run. The rooms offered are Japanese style with a meal or two thrown into the price. A Minshuku can cost anywhere between 4000 yen to 10000 yen per person.
- Japanese style apartment and houses:-Mainly available in Kyoto or Tokyo, these are entire houses or apartments that are rented out to foreign travelers to let them experience a taste of everyday living. These apartments are available with modern or traditional interior as well as renovated historical houses. Prices of renting out these apartments may range between 10000 yen to 50000 yen per apartment.
Western Style :
Hotels belonging to various international and Japanese hotel chains are found all over Japan, especially in the larger cities. The prices in these hotels depend on the category of hotel facilities being availed of.
- Business hotels: These are hotels with small, simple western style rooms with food and drinks available on vending machines. Prices range between 5000 to 10000 yen per room.
- Pensions: somewhat like the Japanese Mishoku, these are family owned accommodations in western style mostly found in the countryside and mountainous resort towns in Japan. Prices for these may range between 6000 yen to 12000 yen per person.
- Dormitories: These are low budget accommodations usually found old buildings in big cities and come at a meager price of 1000 to 3000 yen.
- Hostels: These offer room and meals at the lowest possible budget rates between 2500 to 4000 yen per person. Japan youth hostel, which is a member of the International Youth Federation, operates around 3000 hostels all over Japan.
Unique Style Accommodation :
- Capsule Hotels;- These are small capsule accommodations most suited to male business travelers satisfied with just a room and shared toilet with coin cupboard and television. Prices vary between 3000 to 4000 yen.
- Temple Lodgings: Tourists can opt to stay a night at a Buddhist temple or Shukubo for a price ranging between Rs 3000 yen to 10000 yen. The price generally includes 2 vegetarian meals and an opportunity to be a part of the morning prayers. One of the best places to stay in a temple in Japan is Mount Koya.
- Love Hotels:- As the name suggests, the Love Hotels are not meant primarily for catering to the accommodation for tourists. Rather, these are meant for couples who want to spend some time together, undisturbed, and have nowhere else to go. The rooms are available either for two or three hours during the day or for an overnight stay. The price for renting out a room in a Love Hotel could range between 6000 yen to 12000 yen per room and overnight stay.
Longer stay :
There is an option to rent out entire apartment and stay on a sharing basis and this is available for a price starting from 40000 yen per month. Many companies have rented out such apartments with a target to tap the foreign tourists who have come to Japan for longer stay.