New guidelines to define stigmatized properties

The Ministry of Land, Infrastructure, Transport and Tourism (MLIT) is planning to create clear guidelines regarding the sale and rent of stigmatized properties. Currently, confusion and uncertainty about what is and isn’t a psychological impact have led to numerous disputes between tenants and landlords.

A stigmatized property, known as a jiko-bukken in Japan, is one where an unpleasant event occurred, such as a suicide or murder. In the same way that known physical defects must be disclosed, real estate brokers are also obligated to inform the next occupant about psychological impacts. 

What is considered a psychological impact can vary greatly from person to person. Unnatural deaths that occurred within the home or apartment may be obvious items to disclose, but there are differing opinions about natural deaths, or accidents that may have occurred in the vicinity but not in the property itself. There is also an issue of time. How many years can go by before the incident is no longer considered a defect? 

Surprisingly, only 75% of the respondents to a survey by the Japan Property Management Association indicated that they inform future tenants of a past suicide in the property. For natural deaths or accidental deaths, only 60% of the brokerages reported informing future tenants.

An advisory panel will be set up from this month, with the goal of having the guidelines drawn up by the end of the year. 

Source: The Sankei Shimbun, January 31, 2020.

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