Purchasing Apartments In Tokyo

[Xiizaa]

I've been thinking about this for quite awhile,
I tried looking up on the internet but some of my questions are still unanswered.

1. Can we renew Leasehold-type Apartment Certification or they have to be absolutely demolished?

From where I live, certifications for an apartment only lasts for 20 years and you'd have to repay
the cost in 20 years, how long does purchasing an apartment really last for in Japan?

I've also experienced purchasing an apartment in Singapore in which lasts for 100 years (condominium) and learned that certification length varies between each country.

2. "Shin-Taishin" vs "Kyu-Taishin" in Tokyo? Do they have much of an impact?

3. How much in general do people charge for rents over the actual cost of the apartment?

 

[roots reggae]

I don't know about apartments, but I bought a house in 2007, in fact we bought the vacant land and had a contractor build the house.
It is totally in my name, not my Japanese wife.

Perhaps an attorney can give you a reliable answer. This one charges just Yen 5,400 for an initial 30 minute consultation. You should be able to a pretty good idea of your options at that point.

He lists this as one of his practice areas: ●Real estate and lease-related issues

http://www.t-pblo.jp/fiss/fee.html

 

[nedar]

Not an expert on housing but I can tell you not to use your experience with Singapore property as a standard. The lack of land means the government holds on to most of it rather than selling to land owners or developers.

My impression of Japan, specifically Tokyo, is that most apartments, and the land it sits on, are owned by the building owner and you rent it, whether directly or through an agency (hence the key money).

If you're interested in owning, its easier to buy the land and build yourself the house as @roots reggae did. (Still envious of your oven btw roots)

There was a thread somewhere about government-subsidized housing somewhere but can't recall what it was discussing if you want to look.

 

[veryniceguy]

When you buy a condo here in Japan...it's yours forever...... You own it, but you also pay charges to the building owner for maintenance.... If one day the building owner decides he wants to knock the building down because of some development project, or he wants to build a bigger one, then he's obliged to either buy you out, or propose to move you to another place during demolition and re-construction,(at his cost) and also give you a new condo in the new place. A few of my friends in the Roppongi area are going through this now, with the "Mori Buildings" development going on there... One sold out (for more than he originally paid) and another was moved, and when he returns, he'll have a brand new place.....

 

[vargas]

There are both freehold and leasehold apartments available in Japan. With freehold the apartment owners also jointly own the land, and with a leasehold the land is leased from someone else. There seem to be various types of leases, but I've mostly seen fixed term ones where the building will be torn down at the end of the lease. Those are cheaper than free holds, though not amazingly so. Might be a tax dodge to avoid land tax.

 

[roots reggae]

If you're interested in owning, its easier to buy the land and build yourself the house as @roots reggae did. (Still envious of your oven btw roots)

I give maximum credit to my wife for going through all the paperwork for the loan. She also found an ecologically inspired builder who used all natural materials in building the house, no bad chemicals at all. This was so important to us because we had a newborn and a five year old. The house is well-insulated. We hardly use a heater, and only downstairs, in the winter, and rarely use the air conditioners in the upstairs two bedrooms. We don't need one downstairs.

Me, I just got the down payment together and make monthly mortgage payments. The land cost us ¥ 30 million and the house ¥22 million.

With luck, it will be ours in 4-5 years.

 

[Xiizaa]

Thanks for your replies guys, but could you still get a house with that kind of budget that roots had these days?

 

[rick]

@vargas has given you the most accurate information.

It is possible to buy an apartment/house with 52 million yen, no problem. The question is if you have that kind of money.
Also, it depends if you are paying the entire cost at once or doing it like Roots.
As you get further from the central part of Tokyo prices drop drastically. It's possible to buy a nice 1LDK for ~30 odd million JPY.

But if you want more space, better location etc. you need to cough up more money.

If you like living in studio apartments, you can probably get a decent space within 23-ku's good areas.

What's your budget, and what are your preferences in terms of the property (location, size, etc.)?

 

[Xiizaa]

@vargas has given you the most accurate information.

It is possible to buy an apartment/house with 52 million yen, no problem. The question is if you have that kind of money.
Also, it depends if you are paying the entire cost at once or doing it like Roots.
As you get further from the central part of Tokyo prices drop drastically. It's possible to buy a nice 1LDK for ~30 odd million JPY.

But if you want more space, better location etc. you need to cough up more money.

If you like living in studio apartments, you can probably get a decent space within 23-ku's good areas.

What's your budget, and what are your preferences in terms of the property (location, size, etc.)?

@deckard Dang about 30 mils for 1LDK? I was hoping to get atleast 2/3LDK with that budget.

My budget is about 20-30 since I don't wanna invest too much for now.

Maybe I'll move to a more decent apartment if its worth it.

I plan to rent a temporary apartment though while searching for decent places to live.

I don't mind a location that's a bit far from the center, I don't like places that are too quiet though.

I was hoping for atleast around 35 sqm if possible.

 

[rick]

@deckard Dang about 30 mils for 1LDK? I was hoping to get atleast 2/3LDK with that budget.

My budget is about 20-30 since I don't wanna invest too much for now.

Maybe I'll move to a more decent apartment if its worth it.

I plan to rent a temporary apartment though while searching for decent places to live.

I don't mind a location that's a bit far from the center, I don't like places that are too quiet though.

I was hoping for atleast around 35 sqm if possible.

Cheaper prices are possible, but you need to be further out. If your apartment is a further distance from a subway station, it will also be cheaper.
If your apartment building is old, it will also be cheaper. Do note that buildings built before '81 were not built according to the updated earthquake building codes. So just keep that in mind.
Leasehold is also cheaper of course.

I guess the question is, what is important to you? Are you willing to walk 8 minutes to the subway everyday?
Are you willing to take a 30 minute ride to Shinjuku? Is the building age important?
What about if the building faces West? Will the Sun setting in your eyes everyday affect you?

You need to be very clear about what you want, up to the smallest details. And you pay for what is important to you if you cannot afford everything.
For example, if you value space, then you have to sacrifice distance from the centre of Tokyo.

About size, 2/3 LDK is quite large for Tokyo. If you live further out, like you said, you may be able to find a good property at a good price.

I believe your other thread mentioned you might live in Osaka. If that is the case properties will be cheaper.

In any case, I highly suggest you contact a real estate agent through the Internet. They will be able to find properties on the market for you if you don't speak Japanese. Just give them your criteria. But if you have any questions, feel free to ask and I'll do my best to answer.

 

[roots reggae]

@deckard Dang about 30 mils for 1LDK? I was hoping to get atleast 2/3LDK with that budget.

My budget is about 20-30 since I don't wanna invest too much for now.

Maybe I'll move to a more decent apartment if its worth it.

I plan to rent a temporary apartment though while searching for decent places to live.

I don't mind a location that's a bit far from the center, I don't like places that are too quiet though.

I was hoping for atleast around 35 sqm if possible.

Our place was rather expensive in that we live in a desirable neighborhood, out land is flat and the house is new. I have seen many places go for ¥ 30 million in our area, Zushi-Hayama, even new ones. Our house is called a 100 year house. It is built to last that long, rather than the typical 30 year life span of Japanese homes. So it is small.

 

[MossBoss]

@deckard
My budget is about 20-30 since I don't wanna invest too much for now.

Away from the central fashionable areas of Tokyo - apartments built for small families are typically 40 million.

 

[macaurox]

I give maximum credit to my wife for going through all the paperwork for the loan. She also found an ecologically inspired builder who used all natural materials in building the house, no bad chemicals at all. This was so important to us because we had a newborn and a five year old. The house is well-insulated. We hardly use a heater, and only downstairs, in the winter, and rarely use the air conditioners in the upstairs two bedrooms. We don't need one downstairs.

Me, I just got the down payment together and make monthly mortgage payments. The land cost us ¥ 30 million and the house ¥22 million.

With luck, it will be ours in 4-5 years.

That sounds good, from experience, the materials used are so bad these days, you can hear anything in the entire house.. walls are so thin...

Can you tell me why its easier to buy land and then custom build?

You have a mortgage, but as a local, or foreigner?

 

[roots reggae]

That sounds good, from experience, the materials used are so bad these days, you can hear anything in the entire house.. walls are so thin...

Can you tell me why its easier to buy land and then custom build?

You have a mortgage, but as a local, or foreigner?

Our walls are thick. When the windows are closed, it is so quiet. In the morning, I don't even here the constant whine of motorcycles delivering newspapers.

I am not saying it's easier to buy the land and custom build. There are lots of new houses and older ones for sale. We preferred to build one that we knew we would like. Also the bank likes new houses which lose less of their value.

I have mortgage as a foreigner. I believe Shinsei Bank has changed the policy, but I applied during a narrow window when they would approve a loan if there was a Japanese spouse. My wife was not working, so they used my income. I did have to come up with about a
¥ 15 million down payment, maybe because I am so old they would only give me a 23 year mortgage. We have been paying extra at a pace when it should be paid off within 12-13 years from the 2007 loan date.

There are other banks out there that will loan to foreigners. You need to contact banks for their policies-all are different.

 

[910234]

The main banks offering mortgages to foreigners without too many conditions or restrictions are Shinsei Bank, SMBC Prestia (formally Citibank), and Suruga Bank.

At the moment Shinsei have the most competitive interest rates while Suruaga comes in about 6% compared with 0.85% with Shinsei.

 

[roots reggae]

The main banks offering mortgages to foreigners without too many conditions or restrictions are Shinsei Bank, SMBC Prestia (formally Citibank), and Suruga Bank.

At the moment Shinsei have the most competitive interest rates while Suruaga comes in about 6% compared with 0.85% with Shinsei.

I have been totally happy with Shinsei. The offer assistance in English. With my mortgage I get a fantastic exchange rate .07. I do most of my banking with them online-not most, lately all.

 

[macaurox]

Our walls are thick. When the windows are closed, it is so quiet. In the morning, I don't even here the constant whine of motorcycles delivering newspapers.

I am not saying it's easier to buy the land and custom build. There are lots of new houses and older ones for sale. We preferred to build one that we knew we would like. Also the bank likes new houses which lose less of their value.

I have mortgage as a foreigner. I believe Shinsei Bank has changed the policy, but I applied during a narrow window when they would approve a loan if there was a Japanese spouse. My wife was not working, so they used my income. I did have to come up with about a
¥ 15 million down payment, maybe because I am so old they would only give me a 23 year mortgage. We have been paying extra at a pace when it should be paid off within 12-13 years from the 2007 loan date.

There are other banks out there that will loan to foreigners. You need to contact banks for their policies-all are different.

Thanks for the info. 15M yen down payment seems high especially when I see ads in the newspaper with low down payment and some crazy low monthly payment. Then again, houses I'm looking at are around 20M yen.

Thanks!

 

[Mr Cat]

The ads you are looking at aimed at japanese people. As foreigner getting a loan is slightly more complicated.
Regarding the downpayment, you can calculate that it will be 20% of the value of the property.
So in case the appartment you buy costs 20M down payment would be 4M yen. To that you need to add agency commission, bank fee, etc...

 

[roots reggae]

Thanks for the info. 15M yen down payment seems high especially when I see ads in the newspaper with low down payment and some crazy low monthly payment. Then again, houses I'm looking at are around 20M yen.

Thanks!

Getting the loan mostly depends upon your income, credit history, and income. My loan was about ¥ 37 million. I was 56 at the time, pretty old to get a ¥ 37 million loan. I have a feeling that the newspaper ads may be a form of bait and switch. We also talked to companies that were go-betweens. They were especially aggressive and probably got some sort of referral fee. We were lucky to finally hook up with Shinsei at just the right time.

 

[TAG Manager]

I've done a bit of real estate business in Japan and getting a loan as a foreigner isn't as hard as it seems.

It's only complicated if you don't walk into the deal with some cash in hand and your financials laid out in a clear picture.
+1 for an easier process if married to Japanese. (and/or can speak nearly fluent Japanese)
+1 for an easier process if employed by a large, well known company.
+1 for an easier process if you have permanent residence status.

If you are investing in real estate here, then I expect you'd already have the last point covered.
It's definitely harder if you don't have PR status.

I'd never recommend trying to do a loan for more than 85% of the total cost of the property. If you don't have the cash for a sizeable down payment, wait until you do.

True story: When I first got into real estate in Japan, I scouted a few properties and found a few that I was interested in. The agent I spoke to at first did not take me seriously at all. He just gave me the once over and 'whatever' attitude... UNTIL he asked how much cash I had on hand to make a purchase. I gave him a number and from that point forward, he bent over backwards to process the deal I wanted to make. For the financing arrangements, I had him scout a few banks and they all came back with reasonable rates and that they'd have no problem doing business with me. I chose Sumi-Tomo Trust Bank (SMTB) since their terms were agreeable and they were easy to further negotiate with. That first deal was done within 26 days once I gave the 3m yen deposit and fees.

Taxes, Insurance, Transfer Fees -- all came to about 1.7m yen if I recall correctly. I remember going with a more hefty insurance plan at about 680k yen. Acquisition taxes (building and land) will vary based on what you buy, but that's a one time tax. The actual property taxes for the structure and land are far more reasonable. (Edit: Transfer fees, title/deed,etc, seem to range between 200 and 280k, I know it was 200-something, but it just depends on who has been asked to do the registration and transfer of the property.)

A small note about Shinsei - they may have changed their colors in recent years, but I wasn't pleased with the service when I made inquires about some of the terms on their offer. Mainly, a lack of understanding of their product and lack of respect of time. (They should not be returning calls nearly 2 days later after an inquiry that was time sensitive) No matter in this case, SMTB came back with a better rate and terms after a few discussions.

 

[DeepStick2020]

I'd love to do this so I can host females in a separate place from where I actually live. Seems that I needed a person to co-sign.

By the way,have you tried the group that specializes in selling to forigners? I saw an add before I left Tokyo.

 

[macaurox]

Getting the loan mostly depends upon your income, credit history, and income. My loan was about ¥ 37 million. I was 56 at the time, pretty old to get a ¥ 37 million loan. I have a feeling that the newspaper ads may be a form of bait and switch. We also talked to companies that were go-betweens. They were especially aggressive and probably got some sort of referral fee. We were lucky to finally hook up with Shinsei at just the right time.

Self employed from other country seems to be another show stopper. I assume its easier to be employed by some company? Since money can be moved easily when owning a business, I'm not sure how to proceed.

 

[macaurox]

And also, what "agents" are you talking about? Realestate ones or mortgage broker type of agents?

 

[roots reggae]

Self employed from other country seems to be another show stopper. I assume its easier to be employed by some company? Since money can be moved easily when owning a business, I'm not sure how to proceed.

Don't know your situation. The more money you have the better. If you can pay the entire amount, then you are set. You just need a Japanese speaker to help with paperwork. Perhaps the attorney listed above.

 

[TAG Manager]

And also, what "agents" are you talking about? Realestate ones or mortgage broker type of agents?

There's usually a regular real estate agent who coordinates everything. They can also introduce a loan agent who helps coordinate quotes from various banks, based on your background. They usually have direct contact with loan officers and can smooth the process...