Can I rent my home out on a short-term basis, like on AirBnb, in Japan?

September 18, 2014Real Estate News,Rental Market,All,Osaka

  • Currently, any leases for less than 30 days require either a hotel license or minpaku registration.
  • Failure to meet licensing requirements could result in jail or a fine, depending on the type and severity of the violation.
  • Most homes and apartments do not qualify under current regulations.

Recently, the Japanese government has been deregulating the hotel and short-term letting industry to provide more accommodation options for foreign tourists in the lead-up to the 2020 Tokyo Olympics. With the latest data putting Japan’s residential vacancy rate at 13.5%, this reform has been touted as a way to help fill up some of Japan’s 8 million empty homes, of which half are rentals.

AirBnb is already quite popular in Japan with listings ranging from traditional farmhouses in the countryside to contemporary apartments in downtown Tokyo.

The new short-term minpaku regulations now allow hosts to rent out their property on a short-term basis. Properties must still meet certain requirements, such as being in the correctly zoned location, having a building certificate, meeting minimum floor sizes, having lockable windows and doors, proper walls between rooms, adequate fire escapes, information provided in several languages, meet hygiene requirements and must meet construction and fire codes. If you plan to sub-let your apartment, you need your landlord's permission. If you own your apartment, the home owners association must allow minpaku rentals in the building (most do not).

A registered minpaku-type property may rented for up to 180 days per year. Local governments have the authority to reduce this limit to an even lower number, and many already do. In Tokyo, each ward has introduced their own set of rules and limitations.

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by Zoe Ward

New apartment prices in Tokyo up 26%

September 17, 2014Tokyo apartment prices,New Apartments in TokyoReal Estate News,Market Information,All,Tokyo

According to the Real Estate Economic Institute, 2,110 brand new apartments were released for sale in greater Tokyo in August, down 50.0% from the previous month and down 49.1% from last year. This is the 7th month in a row to see a year-on-year drop in supply.

1,469 apartments were sold, making the contract rate 69.6%. This is down 14.1 points from the previous month and down 11.9 points from last year. This is the first time the contract rate has fallen below 70% in 19 months. A contract rate over 70% usually indicates positive market conditions.

The average new apartment price was 56,850,000 Yen, up 2.8% from the previous month and up 18.5% from last year.

The average price per square meter was 775,000 Yen, up 0.5% from the previous month and up 14.5% from last year.

212 apartments in high-rise buildings (over 20-storeys) were offered for sale, down 86.2% from the previous month and down 78.6% from last year. The contract rate was 50.9%, down 42.6 points from the previous month and down 34.3 points from last year.Read more

by Zoe Ward

Mori Trust buys Meguro Gajoen despite ongoing lawsuit

September 16, 2014Meguro GajoenOffice/Retail News & Information,Real Estate News,All,Hotel News,Tokyo

Meguro Gajoen

In August, it was announced that Mori Trust had acquired Meguro Gajoen from Loan Star Funds for approximately 130 billion Yen. Singapore’s GIC was previously in talks to purchase the property for 134 billion Yen but backed out due to concerns over a legal dispute brought up by the original landholders.

Meguro Gajoen is a wedding hall, hotel and office building complex located 250 meters west of Meguro Station in Tokyo. Mori Trust acquired a large majority of the land (37,000 sqm) as well as the following five buildings with a total floor area of 150,000 sqm:Read more

by Zoe Ward

Know the basics before investing in real estate

September 15, 2014Buyer Beware!,Property Purchasing Guide,All

Lately there has been a surge in the number of real estate-related books and seminars encouraging ‘salarymen’ to invest in one-room apartments as a way of securing an extra source of income. These promotional seminars were also very popular during the bubble in the late 1980s.

As a result, real estate listing site Rakumachi, which specialises in investment-type properties, has seen the number of registered users increase by 60% to 36,672 users over the 12 months to July 2014.

Low interest rates, a reduction in inheritance tax deductions from 2015, and concerns about a stable income after retirement are causing people to turn their attention to the property market.

But before parting with several million Yen, first-time investors must make sure they are fully aware of the potential risks involved. Rather than expecting quick and easy returns,  investors also need to have a long-term outlook.Read more

by Zoe Ward

Secondhand apartment transactions down while prices continue to climb

September 12, 2014Tokyo apartment pricesReal Estate News,Market Information,All,Tokyo

According to REINS, 2,118 second-hand apartments were sold across greater Tokyo in August, down 16.4% from the previous month and down 5.9% from last year. This is the 5th month in a row to see a decline from one year prior.

The average apartment sale price across greater Tokyo was 28,190,000 Yen, up 7.4% from the previous month and up 10.2% from last year. The average price per square meter was 436,900 Yen, up 6.5% from the previous month and up 9.2% from last year. The average building age was 19.47 years.

1,003 apartments were sold in the Tokyo metropolitan area, down 18.3% from the previous month and down 9.2% from last year. This is the 5th month in a row to see a decline from one year prior. The average apartment sale price was 34,870,000 Yen, up 9.0% from the previous month and up 12.7% from last year. The average price per square meter was 587,500 Yen, up 7.8% from the previous month and up 13.1% from last year. The average building age was 18.26 years.

The average sale price in central Tokyo’s 3 wards (Chiyoda, Chuo and Minato) was 55,820,000 Yen, up 24.2% from the previous month and up 20.8% from last year. The average price per square meter was 920,200 Yen, up 0.8% from the previous month and up 11.7% from last year. The average building age was 15.38 years.

Average sale prices per square meter were up in a number of locations last month:Read more

by Zoe Ward

Development near Sengaku-ji Temple draws opposition

September 11, 2014Historic Properties,New Construction,Real Estate News,All,Tokyo

Sengakuji TokyoA proposal for an 8-storey apartment building next to the entrance to the historic Sengaku-ji Temple in Minato-ku has drawn criticism and opposition from residents due to the potential impact it will have on the landscape and character of the area.

The site in question is located next to the temple’s Chu-mon gate. A 3-storey house is being demolished to make way for a 23m tall 8-storey apartment building which will contain mostly studio apartments. The land had been purchased by a Minato-ku based developer and construction is scheduled to start in mid-September.

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by Zoe Ward

Japan’s top developers by resale value in 2013

September 10, 2014Real Estate News,Market Information,All,Tokyo

Style Act Co., Ltd. (formerly Attractors Lab) published their ranking of Japan’s top developers by resale value. In top place for the fourth year in a row was Marubeni with an average resale price of 1.6% lower than new. The average resale value across all developers was -10.0%.

The data is based on the average difference in the advertised price of an apartment in 2013 vs. the average price of new apartments built from 2001 onwards. Over 38,000 apartments were used in compiling the data.

Top developers by resale values:Read more

by Zoe Ward