How to purchase the single-unit investment property in Japan

Real Estate

the advantages of single-unit property investment, as opposed to whole building investment

It is that you can start investing in real estate while lowering the risk. However, this is basically applicable to beginners, and for those who have 10 or more properties, there is a possibility that those who purchase whole buildings can earn more advantage.

For example, if you plan to purchase a whole building, the purchase price will exceed 100 million yen in Tokyo. However, you can purchase a single-unit property from 10 million yen.

Also, as there are a lot of single-unit properties compared to whole buildings, you can lower various risks such as vacancies, declining rents and so on by choosing a good location from among many properties.

Also, if you have multiple properties in different places, you can reduce the risk. Since it is a single-unit property, you can save on repair costs and calculate future earnings easier.

However, if the investment amount is small, naturally, the income-gain will be decreased, so we also recommend to buy whole buildings for investors who have a lot of experience of investment.

Some questions or misconceptions that some foreign investors have about the Japanese real estate market

There are many questions from foreign investors about eviction and delinquency of rent. Practices concerning evictions and delinquency of rent are very different from Japan and overseas. In overseas, you will receive litigation and collection right away if you do not pay rent, but in Japan you would not be kicked out so easily even if you do not pay rent. Also, in Japan, if the lessee had disappeared and left the baggage, the owner can not throw the baggage, because the lessee has ownership of the lessee.

In this way, protection measures for lessees are strong in Japan, and it is often not understood by overseas people.

Possibility that foreigner who has not a permanent resident can get local (Japanese) financing for an investment property

It is possible. Several financial institutions are offering loans even if you do not have permanent resident status. However, if you do not have permanent residence rights, the examination criteria for loans tend to be strict. Or the loan amount may be low, and in many cases the burden on cash increases.

However, recently, many financial institutions have begun to respond to foreign languages and are beginning to develop services for overseas investors.