Long-term and unfurnished rental property
Table of Contents
Long-term and unfurnished rental property
Things you need to know and have
Starting Costs
Rental Flowchart
This type of property is for people who are staying in Japan with a long-term visa either working or studying and have plans to stay for at least several years, either renting personally or through their company.
Things you Need to Know and Have
How well you need to speak Japanese
Japanese landlords and landlord agents (hereafter collectively called “landlord”) are highly concerned of how well you speak Japanese. In some cases, it isn’t even the landlord who is concerned but more the real estate company who does the day-to-day management of the property and is the one communicating with you throughout your lease.
Many of you may know a Japanese speaker who can help you with communicating with your landlord, like your friend or people at work, but the landlord expects you to have sufficient language skills to be able to understand given orders during an emergency situation.
However, rest assured there are landlords who don’t care as much, or they are fine as long as you’re using paid services helping you to communicate with them.
Find an agent who will do their due diligence to find the right landlord you should rent from as it would be wasted effort and time trying to rent from the wrong ones.
Residence Card, Japanese Phone Number, and Employment Letter or Enrollment Certificate
To rent a long-term rental property you will need a residence card. Having a residence card would mean having a sponsor in Japan or your business activities are permitted. Japanese landlords care only about whether you’re working and earning stable income here in Japan, rather than how much you’re earning abroad or how much savings you have in your overseas accounts.
You will also need a local phone to go through the guarantor company background check for your rental application, and this can’t be messaging apps like LINE or internet phones. If you already have a phone device, you could possibly acquire a voice SIM on your arrival at the airport by booking one in advance. This way it’s easier than getting one in the city, as that will require you to have a Japanese home address.
Upon your rental application, you’ll be asked to hand in an employment letter stating your annual salary (could be replaced by an employment contract) to show that you’re capable of paying the rent. Normally, your monthly rent should be within one-third of what you earn on a monthly basis before tax reduction. If you’re a student you’ll need to submit an enrollment certificate or a student card, and at times will be asked to show your balance at your Japanese or international bank.
Using Guarantor Company Service
Almost all foreigners will be asked to use a guarantor company (保証会社 Hosho-kaisha) as opposed to being asked for a personal guarantor. Guarantor company simply addresses concerns over any late and non-payments to make it hassle-free for landlords to collect debts. Of course, there are landlords who still prefer a personal guarantor over a guarantor company. But since a guarantor in Japan normally means a family member or relative, that would not be an option for most foreigners.
In order to use a guarantor company you will always need to provide an emergency contact person in Japan, and most of the time they prefer Japanese or a foreigner with permanent residency. The role of the emergency contact person is to know your whereabouts at all times but not to guarantee any liabilities tangible or intangible arising from your contract.
Buying your own furniture and appliances, and paying utility and internet fees
Most apartments/houses do not come with furniture and appliances except maybe for air conditioners, cook stove, and light fixtures, but that’s about it.
For utilities, you’ll have direct contracts with respective utility companies and will be charged based on usage. Most of the time there’ll be no internet hook-up in your rental property, so you’ll have to have it installed. There may be installation costs arising from it on top of monthly usage charges.
Starting Costs
Approximately 4 - 6 months' rent
Deposit (1 or 2 months' rent)
Key money (1 month's rent or none)
First month’s rent pro-rated and next month's full rent
Guarantor company fee (0.5 -1 month's rent which is a one-time payment)
Housing insurance premium 15,000 - 25,000 yen (for 2 years)
Agency fee (1 month’s rent + tax)
Below costs may apply additionally
Lock change fee 12,000 - 35,000 yen
24-hour support service 10,000 - 15,000 yen
Sanitization fee 5,000 - 12,000 yen
Contract processing fee 5,000 - 10,000 yen
Deposit
Usually, you need to pay 1 or 2 months of your rent as deposit. You’ll receive back this deposit at the end of your lease, after cleaning fee and repair fees are appropriated. If you did not make any new damages during your rental term then only the cleaning fee will be deducted and the rest returned.
Please note at times there may be a special clause in the lease saying that the deposit will not be refunded. In that case, the landlord will use the deposit to clean your room and fix damages, and keep any balance. Keep in mind though if your repair fees exceed the deposit the landlord will ask you to pay the difference.
Key Money
Usually, you need to pay 1-month worth of key money at most but sometimes none is asked for. This fee is non-refundable, and the money just goes into the landlord’s pocket.
Upfront Rent
In most cases the landlord will charge you the prorated rent of the first month and the full rent of the next month. If your contract starts before the 10th day of the month, the landlord may hold back from charging you for the next months’ rent.
Guarantor Fee
The guarantor company (保証会社 Hosho-kaisha) is always selected by the landlord and you cannot choose freely. The guarantor fee is anywhere between 30 – 100% of the monthly rent which is a one-time payment. There’s usually an annual renewal fee of 10,000 – 12,000 yen, or in lieu of that, a monthly guarantor fee of a few percents of the monthly rent.
Housing Insurance Premium
The insurance company is always selected by the landlord and a fixed plan is usually prepared. The premium will range between 15,000 – 30,000 yen depending on your household structure.
The insurance covers any damages to your household belongings caused by natural calamity, theft, water exposure from plumbing troubles, and even when you break your own personal items while cleaning your room. It also has a landlord and third-party liability coverage which covers any damages you may inflict on others.
Most insurance plans proposed from landlords do not include earthquake coverage which may come as a surprise to most people knowing that Japan is a country of earthquakes. However, it is also a fact that it would need to be one large earthquake to significantly damage any of your personal belongings. Furthermore, since the earthquake insurance pays out only a low percentage of the value of your items, most people don’t bother to be covered.
Agency Fee
Agency fee is usually 1 month of the rent which does not include management fee in the calculation, plus consumer tax.
Other Small Fees (please note that these fees may or may not arise)
Lock change fee: 10,000 – 30,000 yen
24-hour support service fee: 12,000 – 15,000 yen
Sanitization fee: 5,000 – 12,000 yen
Contract processing fee: 5,000 – 10,000 yen
RENTAL FLOWCHART
1. Prepare required items for rental contract
2. Contact an agent and start your property search
3. Tour and apply for an apartment
4. Wait for background checks (duration 1-5 business days)
5. Once your application is accepted then finalize move-in date
6. Contract signing and contract fee payment
7. Arrange for utility and internet services, and buy furniture and appliances
8. Receive keys and move in
Prepare required items for rental contract
Make sure you have your residence card, Japanese phone number, and if you’re just starting work then your employment letter, and if you’re studying at a school your enrollment certificate before initiating your property search.
Contact an agent and start your property search
Contact an agent and consult about your housing criteria, ideal moving date, and share information about yourself, such as, work situation, annual income, nationality, Japanese speaking skills, etc. Your agent will then start looking for your rental property.
Tour and apply for an apartment
Tour candidate properties and once you’ve found the right place put in an application guided by your agent. You’ll need to turn in all required items mentioned above at this time.
Wait for background checks to complete (duration 1-5 business days)
Background check will begin and usually takes 1 – 5 business days depending on how busy the landlord is.
Once your application is accepted then finalize move-in date
Once your application is accepted, decide on your move-in date which shouldn’t be more than 3 - 4 weeks from your application date. Some landlords will have a strict starting date requirement which could be anywhere between 7-14 days from your application date.
Contract signing and contract fee payment
The contract signing date and contract fee payment deadline will be set 3 - 10 days after your application is accepted. The contract fee shall be paid by bank transfer, and paying cash or with a credit card is usually not an option. Some people will not have a Japanese bank account for this payment as opening a Japanese account requires a Japanese home address. If you don’t have a Japanese account then you should seek help from someone you know or your agent to transfer the money for you through their accounts.
If you don’t have a bank account in Japan and need to make a wire transfer at a bank or post office, you’ll be limited to transferring only 100,000 yen per day. This is generally not preferred by landlords, as they usually do not accept payments in installments.
Contract signing will be held either at your agent’s or landlord’s office and the contract will be explained in English by your agent. After you’ve signed the contract pay the contract fee.
Arrange for utility and internet services, and buy furniture and appliances
Arranging for utility services can be guided by your agent, and if you need internet connection at home you should start contacting the internet provider of the property early. Setting up an internet connection could take weeks as you may need your internet company to install internet lines to your room for the first time.
If you’re starting a new life in Japan, then you’ll have to buy furniture and appliances yourself. I’ve seen people having to wait weeks to get their furniture delivered so it would be best to start shopping right after you’ve been accepted.
Receive keys and move in
Receive the keys and move in. Within 7 – 10 days of your entry you will need to hand in a report of any damages that existed when you entered the property. Handing in this report can protect you from being charged for damages that you did not make. Even if the landlord does not require you to hand in pictures, you should take them anyway for your own sake.