Transaction Costs

Real Estate Taxation Summary

1. Brokerage fee
Property price less than JPY 2,000,000:    5% + consumption tax
Property price JPY 2,000,000 or greater:   4% + JPY 20,000 + consumption tax
Property price JPY 4,000,000 or greater:   3% + JPY 60,000 + consumption tax

* There is no need to pay a brokerage fee when the property is purchased directly from  the seller.

2. Stamp Duty
The amount of stamp duty payable is dependent on the property value, and ranges from JPY 5,000-480,000.

3. Registration Tax
This tax is for registering real estate ownership. Pay the tax to the judicial scrivener, after which the judicial scrivener pays the Legal Affairs Bureau.

* There is a separate registration tax applied when obtaining a mortgage.

4. Judicial Scrivener fees
Commission a judicial scrivener to carry out ownership registration.

* An extra fee is payable for the registration tax when obtaining a mortgage.
** Note that the judicial scrivener fees are paid at the same time as the registration tax.

5. Fire & Earthquake Insurance
Earthquake insurance can only be applied to tenanted residences, but not for non-tenanted buildings. Earthquake insurance is not applied to commercial or industrial buildings. Fire insurance can be applied to all buildings, and is a prerequisite for obtaining a housing loan.

For condominiums, the fire & earthquake insurance is paid by the HOA and the cost comes out of the common fees. The insurance covers the building structure and common areas.

There are 3 types of insurance: building (including common spaces), lettable/leasable area, tenant. When the tenant leaves a property, the owner cannot use the tenant’s insurance policy for a claim, only that of the building insurance or lettable area.

6. Settlement Amount
a) fixed asset tax (property tax)
b) city planning tax
c) building maintenance cost
d) reserve fund for repairs
e) return tenant deposits at end of lease

Basically, all expenditures will be charged after registration of ownership. c), d) applies to condominiums. e) applies to rental buildings.

In case of purchasing an entire building, utility expenses for common areas, PM fees, and BM fees will be charged.

7. Initial reserve fund for repairs
Partial payment required when purchasing a newly‐built condominium (not included in condominium purchase price). Does not apply for second-hand units.

The partial amount is decided by the HOA by taking into consideration the total costs of the repair and maintenance schedule within a certain period, dependent on the HOA. This partial payment is considered to be the initial reserve fund.

8. Fees for financing
Fee amount depends on which bank financing is secured from.

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* Our multinational team accepts both written and spoken queries in English and provides language support for speakers of Mandarin and Bahasa Malaysia.

Each of us investment team members are expert professionals at property investment advisory, with an acquired know-how of Japanese property investment. We are more than happy to support you by helping you develop your ideas about the properties in the pursuit of your goals. Also, our multinational team welcomes any inquires in English and can provide additional support for speakers of Mandarin and Bahasa Melayu.