How To Buy A House In Japan As A Foreigner Living Abroad

Loving Japan seems to be a justified reason to buy a house there as a vacation home. 

And you’re not the only one. 

Many foreigners, both in and outside Japan, are interested in buying a house in Japan. That’s why we have this article just for you. 

Here, we discuss how to buy a house in Japan as a foreigner and what documents you need to make the process smoother.

Can a foreigner purchase property in Japan?

Yes, foreigners can buy property in Japanese real estate. There is no residency requirement when buying in the Japanese property market.

The only barriers foreigners may face are the language barrier and potentially the time zone difference. 

How to buy a house in Japan as a foreigner abroad

Let’s go over the general steps for buying a house in Japan. 

The steps for buying a house as a foreigner

Buying a house in Japan: a step-by-step guide

1. Use akiya banks and real estate websites

There are many akiya banks and real estate market websites for foreigners. 

These sites will show you the available properties in and around Japan, including akiya houses for sale and newly built houses.

Since most foreigners are abroad, property viewing is optional. However, the real estate staff will coordinate an online viewing if you request one. 

2. Purchase application

You will submit a purchase application once you decide which property you want to purchase. 

The real estate staff will help with the application process, from filling out necessary forms to submitting required documents and ensuring all legal requirements are met.

Once the application is approved, the sales agreement outlining the terms and conditions of the sale will be drafted.  

3. Payment and transfer of ownership

For this final step, it’s best to be in Japan so that you can attend the signing of the sales agreement. 

Additionally, for the property to be legally under your name, you and a judicial scrivener will need to go to the Legal Affairs Bureau to submit a property register certificate (登記簿謄本, tokibotohon).

Important documents when buying a house in Japan as a foreigner

You should prepare several key documents when you want to buy a property in Japan as a foreigner abroad.

If there are any further documents, your real estate agent will relay them to you.

a) Affidavit of residency or citizenship status

A legal document proving your residency or citizenship status outside Japan is usually prepared by a lawyer.

b) Power of attorney

A document granting the local real estate agent in Japan to have the authority to complete specific documents on your behalf.

c) Utility bill management

Pay bill on MailMate’s online dashboard

While you may not stay in your Japanese property all the time, you still need to pay utility bills such as your gas, electricity, water, and internet bills.

Using a virtual mailbox service like MailMate allows you to receive your mails and bills online where they will help pay your bills on your behalf.

d) Tax agent 

You must appoint someone in Japan to handle your property tax, real estate acquisition tax, and fixed asset tax payments on your behalf when you are away from the country. (Check out MailMate's property tax calculator to find an estimate on your real estate taxes.)

MailMate can be your tax agent to help you handle all property-related taxes. 

e) Translation service

If you are in contact with a Japanese akiya and real estate company, using a translation service is extremely helpful for better communication. About 2-3 days of their service is needed.

How to buy a house in Japan as a foreigner

Now, it’s time to tackle how to buy a house in Japan as a foreigner living here.

Buying a house in Japan is similar when you are looking to rent a place here. Except for renting, you are purchasing the property, which will require a few more documents. 

Requirements for foreigners buying a house in Japan

As a foreigner living in Japan, you will need to prepare these items when buying a house in Japan. 

1. Valid residence card

Example of residence card from ISA Japan

All foreigners living in Japan are required to have a residence card (在留カード, zairyu card) or hold permanent residency status in Japan.

While foreigners in Japan can buy a property without a permanent residency or a residence card, it will be more challenging since the buyer must comply with legal and financial requirements, such as obtaining a bank account in Japan or tax forms.

2. Registered seal

Example of registered seals

For formal documents in Japan, instead of signing without a signature, you will need a jitsuin (実印), a registered hanko with the municipal office of a city, ward, town, or village.

You may not need one, depending on the real estate company and agent. However, it’s best to have at least a hanko, just in case.

Obtaining a hanko is inexpensive. I got mine for about 600 yen (less than $5). While I used my hanko for my rental apartment agreement, I also needed one when getting a Japanese bank account.

After registering your seal, you will receive the registration certificate (印鑑証明書, inkan shomeisho), which is equivalent to a notarized signature.

3. Bank account in Japan

Opening a bank account in Japan can be difficult for foreigners, but once you have one, you’re all set. A few English-friendly bank accounts for foreigners include:

• Shinsei Bank 

• SMBC Trust Bank

• Sony Bank

• Japan Post Bank (Yucho)

Having a bank account in Japan when buying a property in Japan demonstrates financial stability and credibility.

4. A loan from a Japanese bank

While not always required, such as when paying in full or making the payment in cash, obtaining a loan is always easier said than done.

Some Japanese banks will have special financing options or incentives when buying property in Japan.

So contact your Japanese bank to see their options. 

5. Guarantor from a guarantor company

Sometimes, a guarantor from a guarantor company is needed when buying property in Japan for additional financial security to lenders or sellers. 

The guarantor company assures the lender or seller that payments will be made, even if the buyer cannot.

In some cases, Japanese banks and real estate companies will require a guarantor. However, not all banks and real estate agreements will require you to have one. 

Types of properties foreigners can not buy

The Foreign Exchange and Foreign Trade Act (FEFTA) placed restrictions on buying land that is designated as “forest” or “agricultural” without permission from the Japanese government.

Additionally, some buildings will have rules restricting units to non-Japanese residents. While these are less common, that will depend on the property owner. 

Frequently asked questions

Can Americans buy property in Japan?

Americans can buy property in Japan as there are no citizenship or residency requirements for property ownership. If you are an American abroad, you can contact akiya banks or real estate agents to help you purchase your Japanese property. 

In closing

Now you know how to buy a house in Japan as a foreigner, whether abroad or in the country. Understanding the steps and knowing what to prepare will help make the property-buying process smoother.

When owning property in Japan, you can use it as your vacation home, second home, or Airbnb.