The real estate market in JapanThe blossoming of Japan's real estate market is due to nationwide reconstruction efforts. Currently, this dynamism is especially evident in the large center of Tokyo, the city that never sleeps. The increase coincides with the 2020 Olympics scheduled to take place in the country this year. Is an investment in this sector beneficial or risky for foreign investors?
Real estate in Japan: a sector in constant change
After World War II, Japan 's policy was based on restoration. It was not until the 1970s that the automobile industry received global acclaim through the Subaru brand, which had even become the symbol of modern life. From 1985, the government financially supported investors, and banking entities did not hesitate to massively grant loans to the real estate sector. It was the period of the speculative bubble, which burst in 1990 and caused a recession called by economists the “lost decade”. In 2012, an economic program called “ Abenomics ” was initiated by Shinzo Abe in order to bring real estate out of the abyss. The devaluation of the yen was an opportunity for Tokyo to invest as much as possible in real estate infrastructure across all sectors. The objective of the policy is to get the economy off the ground through the creation of new jobs and the development of residential and commercial buildings. New construction and renovations increased by at least 47 million yen for condominium housing. This price has even reached 58 million since 2013.
Who can invest in Japanese real estate?From a legal point of view, real estate investment in Japan is open to the greatest number of people, as long as the interested person does not take out any loan to finance their project. No domiciliation conditions are therefore required, whether you are a permanent or temporary resident. This is valid both for the purchase of a main or secondary house and for making your money grow through rental investment. Despite this great flexibility, real estate investment in Japan is not always interesting in certain cases, to name only the high prices, particularly in the capital. Other constraints will also have to be faced:
- The complexity of administrative procedures;
- The economic climate;
- The linguistic concern;
- The state of one's own finances...
What are the formalities for investing in real estate in Japan?As in all real estate transactions, there are a certain number of formalities to complete when investing in real estate in Japan, whether purchasing or renting a house or apartment. For the first option for example, the first step consists of contacting the seller via postal mail which indicates:
- Purchase intention;
- The property concerned;
- The desired purchase price.
Next comes the signing of the contract between the two parties, knowing that the buyer generally agrees to pay a deposit of around 10% of the price of the house or apartment. It must also provide:
- Half of the brokerage fees;
- A postage stamp for the mail;
- Identity document: CNI, passport, driving license;
- A certificate of residence;
- A certificate of signature or seal;
- Unpaid balances and the second half of brokerage fees;
- Administrative registration fees;
- Taxes: urban development, land, etc.
- Building repair and maintenance costs (for apartments).