1. How Much Does it Really Cost To Own A Home in Japan?
Understanding the True Cost of Japanese Homeownership
Owning a home in Japan is a dream for many—be it a modern condo in Tokyo or a traditional home in the countryside. However, the sticker price on a Japanese property is just the beginning. A full understanding of the ongoing expenses is crucial for anyone considering buying a home in Japan, whether you’re a local resident or an expat. Here’s a breakdown of what it really costs to own a home in Japan.
1. Property Purchase Price & Initial Costs
Before we dive into ongoing costs, let’s briefly touch on the initial expenses:
Property Price: Varies widely. In Tokyo, a condo might cost ¥40–80 million, while in rural areas, you might find homes for under ¥10 million—or even free (through “akiya” or vacant home programs).
Agent Fees: Typically around 3% of the purchase price + ¥60,000.
Registration & Licensing Fees: Legal fees and property registration taxes can add another 0.5–2% of the property value.
Judicial Scrivener Fees: For paperwork and title transfer—typically ¥50,000–¥100,000.
Stamp Duty: A small fee (¥10,000–¥60,000 depending on the price).
Estimated Upfront Costs: 5–8% of the property’s purchase price.
2. Property Taxes
Fixed Asset Tax (Kotei Shisan Zei)
Rate: 1.4% of the assessed value (not market value).
Frequency: Annual.
For example, if your home’s assessed value is ¥20 million, you’ll pay about ¥280,000 per year.
City Planning Tax (Toshi Keikaku Zei)
Rate: Up to 0.3% of assessed value.
Applies in urban planning zones.
Tip: The assessed value is usually lower than the market value, which helps keep taxes relatively reasonable.
3. Home Insurance
Fire & Earthquake Insurance
Fire Insurance: Required if you take out a mortgage. Premiums depend on the size, structure, and location. Expect ¥20,000–¥50,000 every 5 years.
Earthquake Insurance: Optional but highly recommended in Japan. Typically costs 30–50% of the fire insurance premium.
Total Annual Insurance: Around ¥10,000–¥20,000 depending on coverage and region.
4. Maintenance Costs
Standalone Homes
General Upkeep: Roof repairs, plumbing, painting, pest control—budget at least ¥100,000–¥200,000 annually.
Older homes, especially traditional Japanese ones, may require much more frequent maintenance and can cost up to ¥500,000 per year.
Condominiums (Manshons)
Management Fees: ¥10,000–¥30,000/month.
Repair Reserve Fund (Shuzenhi): Collected monthly to fund major repairs like elevators, hallways, and exterior walls. Typically another ¥10,000–¥20,000/month.
Total Monthly Costs for a Condo: ¥20,000–¥50,000.
5. Utilities
Electricity: ¥10,000–¥15,000/month.
Gas: ¥5,000–¥10,000/month.
Water: ¥3,000–¥5,000/month.
Internet/Phone: ¥5,000–¥7,000/month.
Total Utilities: Approximately ¥25,000–¥35,000/month.
6. Mortgage Interest (if applicable)
Japan has some of the lowest mortgage interest rates in the world:
Typical Rate: 0.5%–1.5% (fixed or variable).
Banks usually offer 35-year terms with favorable conditions, especially for permanent residents.
Total Estimated Annual Costs
| Expense | Standalone Home | Condo (Mansion) |
|---|---|---|
| Property Tax & City Tax | ¥200,000–¥300,000 | ¥100,000–¥200,000 |
| Insurance | ¥10,000–¥20,000 | ¥10,000–¥20,000 |
| Maintenance | ¥100,000–¥500,000 | ¥240,000–¥600,000 |
| Utilities | ¥300,000–¥400,000 | ¥300,000–¥400,000 |
| Total (Annual) | ¥610,000–¥1,220,000 | ¥650,000–¥1,220,000 |
Key Considerations
Depreciation: Japanese homes (especially wooden ones) are considered to lose value quickly. The building may be worth little after 20–30 years, though the land typically retains value.
Renovations: Expect to renovate every 15–25 years. Costs can range from ¥2–5 million for kitchens or bathrooms, up to ¥10 million for full remodels.
Aging Population and Vacant Homes: Some rural areas have excess supply, making resale difficult.
Conclusion: Is It Worth It?
While homeownership in Japan comes with manageable taxes and insurance, the true costs lie in long-term maintenance, depreciation, and sometimes hefty condo fees. However, with low interest rates, a stable legal framework, and increasingly attractive deals outside the big cities, owning a home in Japan can be a rewarding investment—especially for those planning to stay long term.
Tip: Always consult a real estate professional familiar with Japanese regulations, especially if you’re a foreign buyer.