Several legal reforms are under discussion  that could see heirs obligated to update property titles following inheritance. These proposed changes are intended to make it easier to identify the owners of abandoned or unused land across the country.

The Legislative Council of the Ministry of Justice provided a report on February 10 that has suggested the following:

Inheritance:

  • A three-year deadline for heirs to report the change in ownership, or face a fine of 100,000 Yen. 
  • For estates that have not been distributed for 10 years, they will be distributed under the legally prescribed asset allocation rules. 
  • Government-related departments will be able to register deaths on the Basic Resident Registry Network (a national registry of Japanese citizens).
  • Government-related departments will be able to obtain a list of real estate owned by the deceased.

Land forfeiture:

  • For vacant land not deemed to be contaminated or polluted, owners may be able to transfer them to the National Treasury.

Obligation to keep property titles up to date:

  • A change in the address or name of property owner/s must be updated on the title records within two years of the change. If not, a fine of up to 50,000 Yen may be incurred.
  • Government-related departments will be able to change title records after confirming the property owner/s’ intent.
  • Offshore residents will be required to record domestic contact details (this one might cause some headaches).

Reutilizing land and buildings with unidentifiable owners:

  • If the majority of owners agree, the property may be repaired or rented out on a short-term basis.
  • If court approval is obtained, a caretaker may be appointed to sell the property.

These proposals will require revisions to several laws, including the Civil Code and Real Property Registration Act. The government will make a cabinet decision in March, which could see the changes enforced in 2023.

Current regulations do not obligate heirs to record the change in ownership on property titles. For families that have inherited land with little-to-no-value, there is often no point in paying the fees and going through the trouble of updating the title. The longer the titles go unchanged, the more difficult it becomes for local governments to track down the current property owners. This can be a problem when trying to reach owners to clear overgrown land or demolish houses that are at risk of collapse. Public infrastructure projects and redevelopments can often stall if some landowners are untraceable.

While these proposed changes may help to slow or even put an end to abandoned land and buildings, it won’t apply retroactively to the numerous abandoned land and forest lots across the country. The Ministry of Land, Infrastructure, Transport and Tourism reported that 19.8%, or 930,000 hectares, of Japan’s agricultural land has property titles that have not been updated in over 50 years.

Sources:
The Nikkei Shimbun, February 10, 2021. 
Jiji Press, February 10, 2021.

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