Buy a House in Japan as a Foreigner: Complete Guide to Buying in 2025

Are you interested in buying a house in Japan as a foreigner? The good news is that foreigners can buy property in Japan without significant restrictions. Whether you're looking to live in Japan permanently, seeking a vacation home, or exploring investment opportunities in the Japanese real estate market, this comprehensive guide will walk you through everything you need to know about purchasing property in Japan.

Can Foreigners Buy Property in Japan?

The straightforward answer is yes – foreigners can purchase property in Japan with virtually the same rights as Japanese citizens. Unlike many Asian countries, Japan has no restrictions on property ownership for non-citizens. As a foreigner living in or outside Japan, you can buy real estate, including both land and buildings, and hold them indefinitely. This makes Japan an attractive destination for international investors and expatriates looking to buy property.

Whether you're interested in a modern apartment in bustling urban centers like Tokyo and Osaka, a traditional home in Kyoto, or a vacation property in a scenic rural area, the opportunities for foreigners to buy property are extensive. Keep in mind, however, that owning property in Japan does not automatically grant you residency in Japan. Buying a home and obtaining a visa are separate processes.

Market Overview for Real Estate in Japan 2025

Japan's residential real estate market remains firm into 2025. After a strong 2024 – with Tokyo condominium prices up roughly 13% year-on-year – housing values are generally rising nationwide. In Tokyo's 23 wards, new apartment prices climbed double digits in 2024, especially in central and high-end towers. Supply is tight: for example, Greater Tokyo's new condo supply fell about 15% in late 2024, yet property prices continued to climb everywhere.

Factors driving demand in the property market include:

• A recovering Japanese economy
• Surging inbound tourism (forecast to exceed 35 million visitors in 2024)
• A historically weak yen (making Japan relatively cheaper for foreign buyers)

On the cost side, the Bank of Japan ended negative interest rates in mid-2024 (raising policy to ~0.25%), so mortgage rates have risen (e.g., fixed 35-year loans ≈1.9% in spring 2025). Nonetheless, Japanese mortgage rates remain low by global standards.

Price Trends (2024–2025)

Housing prices (new and resale) have generally continued rising nationwide, though at a slower pace in late 2024. Nomura Institute data shows Tokyo 23-ward condo prices +13% YoY for 2024. In Greater Tokyo, resale condo prices were about +4% for late 2024. New-construction prices (per m²) jumped 7–12% across regions in H2 2024.

Insight: Despite higher lending rates, ongoing demand (including from foreign buyers) keeps prices up in the Japanese real estate market.

Demand Factors

Foreign interest in Japanese real estate is strong. Japan imposes no special restrictions on foreign property ownership – foreigners can buy homes just like Japanese. Combined with a weak yen and high yields, this makes Japan attractive to overseas investors. The tourism revival and economic growth have also spurred investor confidence.

Insight: A foreigner-friendly ownership regime and macro tailwinds (tourism, market stability) underpin continued foreign interest in buying property in Japan.

Why Buy a House in Japan?

Before diving into the buying process, let's explore why many foreigners are choosing to purchase property in Japan:

• Stable Investment: Japan's real estate market offers steady appreciation, particularly in major cities.
• No Restrictions for Foreigners: Foreign buyers enjoy the same property ownership rights as Japanese nationals.
• Relatively Affordable Options: Outside premium locations, property can be surprisingly affordable, with cheap houses available in rural areas.
• Strong Rental Market: A stable economy and housing shortage in urban areas yield steady rental income for investment properties.
• Quality Construction: Japanese houses and buildings in Japan are known for their innovative design and earthquake-resistant features.

Legal Requirements for Owning Property in Japan

Under Japanese law, foreigners may buy property without special permission. There are no nationality limits on real estate ownership. That said, the paperwork depends on your residency status and location:

In-Japan Residents (Any Visa)

If you live in Japan on a long-term visa (including work visas, spousal visas, or permanent residence), you must provide standard documents:

• Your residence certificate (住民票)
• Residence card (在留カード)
• A registered personal seal certificate (印鑑証明書) or notarized signature
• Proof of income/employment, etc.

These are the same documents a Japanese buyer would furnish. You'll also execute contracts and registrations in Japanese format (with your name in kanji/kana as appropriate).

Permanent Residents

Foreigners with permanent residence (永住者) face virtually the same process as Japanese buyers. They typically need the same forms of ID and proof (residence card, juminhyo, income statements) and can even register a personal seal. In practice, banks and officials treat PR holders like citizens for most purposes.

Non-Permanent Residents (Long-term Visas)

If you have a valid mid/long-term visa but not PR, the buying process is similar to other residents when you are living in Japan. You still need a residence card and may register a seal after obtaining a juminhyo. However, non-PR buyers should note: many mortgage lenders impose additional conditions. Also, while purchasing property itself requires no special permit, foreigners on short visas should ensure their status covers the duration of closing – typically 3–6 months.

Overseas (Non-resident) Buyers

Purchasing from abroad adds complexity for non-residents interested in buying a house in Japan. Japanese law requires that real estate transactions and title-transfer closings be executed in Japan. Thus, non-resident buyers must appoint a local representative (power of attorney) in Japan to sign on their behalf for the sale contract and final payments.

They must also designate a domestic tax agent (納税管理人) and comply with foreign exchange reporting (外為法) obligations. New regulations (from April 2024) require foreign buyers' names to be registered both in kanji/kana and Roman alphabet, and if you have no local Japanese address, you must state that and provide a domestic contact. In short, buying remotely involves extra steps (notarized power of attorney, consular authentication of documents, etc.).

Insight: The legal barrier to foreigners buying property is low, but non-residents should prepare for extra administrative steps (代理人,翻訳,公証).

Step-by-Step Guide to Buying Property in Japan as a Foreigner

Step 1: Preparation and Research

Before you begin actively searching for property, take time to:

• Determine your budget: Consider the total purchase price, including additional costs like registration fees, agent commissions, and property taxes.
• Explore financing options: Research home loan options; note that loans for foreigners can be challenging to secure.
• Decide on location: Choose between bustling urban centers like Tokyo or quieter rural areas, based on your lifestyle and budget.
• Research the market: Familiarize yourself with current property prices and trends in your desired area.
• Property search: Begin looking at property listings to understand what's available in your price range.

Step 2: Finding the Right Property

Once your initial research is complete, start looking for specific properties:

• Engage a real estate agent: Look for real estate professionals who specialize in helping foreigners buy property in Japan.
• Browse online listings: Utilize platforms that cater to foreign buyers with English interfaces.
• Property viewings: Schedule viewings to thoroughly inspect each property.
• Consider property type: Weigh the pros and cons of older properties that may require renovation versus newer, modern options.
• Due diligence: Research the property's history, condition, and any potential issues.

Step 3: Making an Offer

After finding a property you wish to purchase:

• Submit an offer: Your real estate agent will help prepare and submit your offer.
• Negotiate terms: While price negotiations are less common in Japan, there may be room for discussing purchase price and conditions.
• Pay a reservation fee: Typically ranging from ¥100,000 to ¥500,000, this fee secures the property while the contract is prepared.

Step 4: Contract Signing (Keiyaku)

This critical step formalizes the real estate transaction:

• Review the contract: Ensure you get a translation if you don't speak Japanese.
• Explanatory meeting: An explanatory meeting (setsumei) will clarify all contract terms.
• Pay the deposit: An earnest money deposit, typically around 10% of the purchase price, is required.
• Contract signing: Both parties sign the agreement, formally committing to the transaction.

Step 5: Financing and Payment

If you're not paying cash:

• Secure financing: Mortgages for foreigners can be challenging; prepare substantial documentation.
• Japanese mortgage options: Explore various Japanese banks that offer home loans in Japan.
• Down payment: Expect to provide at least 20% of the purchase price, potentially more for non-residents.

Step 6: Settlement and Registration

Finalize the property purchase:

• Settlement meeting: Conducted at a bank or legal office, where the remaining payment is made and ownership is transferred.
• Property registration: A judicial scrivener typically registers the property with the local government, handling the transfer of ownership.
• Pay registration taxes: Registration tax is roughly 2% of the property value.
• Receive the property: After all paperwork is completed, the keys to your new property are handed over.

For non-residents, additional steps such as signing contracts online or appointing a legal representative may be involved. The process is meticulous to ensure a smooth transfer of ownership in real estate purchases in Japan.

Financing for Foreign Buyers (Mortgages in 2025)

Mortgage availability depends strongly on residency and visa status:

Permanent Residents (PR)

With PR status, foreign buyers can generally get mortgages under similar terms as Japanese. Major banks (MUFG, SMBC, etc.) allow PR holders to apply in the same way as citizens. In other words, having permanent residency usually satisfies banks' "stable long-term stay" requirement. PR foreigners typically qualify for 80–100% financing (depending on income) and enjoy the same low rates offered to locals.

Non-PR Long-term Residents

If you have only a standard work or family visa (no PR), mortgages become harder but not impossible. Many Japanese banks formally require either Japanese nationality or PR as a loan condition. In practice, some banks will lend to non-PR applicants under stringent conditions.

For example, MUFG or SMBC may lend if you meet criteria such as:

• Being able to understand Japanese without an interpreter
• Having lived in Japan 5+ years
• Loan amount ≤80% of property price
• Having a Japanese spouse or parent who can be guarantor
• Being up-to-date on all taxes and insurance payments

In other words, even without PR, one route is to use a co-applicant or guarantor with Japanese nationality or PR (spousal or parental), as this satisfies many lenders.

Foreigner-friendly Loan Products

Several banks and lenders specialize in foreigner loans. For example, Suruga Bank explicitly offers a "foreigner mortgage" product. Suruga's plan allows applicants without PR (even those planning to apply) to borrow, as long as they understand Japanese and meet income criteria (e.g. ¥4M+ yearly income). Suruga does not generally require a Japanese guarantor.

Similarly, Aeon Bank and Tokyo Star Bank have special loan programs for non-PR foreigners. These typically ask for a stable job history (e.g. 6+ months' employment) and may require a larger down payment (often ≥20% of price). Such products relax the lengthy-residency requirement (no 5-year rule) but do insist on Japanese language ability and substantial equity.

Foreign Banks and Trusts

Foreign-controlled banks (e.g. Shinhan or Standard Chartered Japan) or home country banks sometimes offer Japan mortgages to expatriates, using their global relationship. These are niche options and often come with higher costs or currency risk.

Practical Mortgage Tips

• Down payments for foreigners tend to be higher. Many loans for non-PR require 20–30% down, whereas Japanese borrowers often secure 90–100% funding.
• Guarantee fees and life insurance (for the loan) are standard.
• You will need to open a Japanese bank account (most lenders require this for repayment) and ideally maintain some local credit history.
• If financing isn't available or approved, paying cash avoids these hurdles.

Rates Environment

After the Bank of Japan raised rates in 2024, Japanese mortgage rates climbed from near-0% to about 0.7% (variable) and ~1.9% (35-year fixed) by early 2025. While still low internationally, these are much higher than the 0.2–0.3% rates of pre-2024. Buyers relying on loans must factor this into affordability when planning to buy a house.

Insight: Permanent-resident foreigners generally have few loan restrictions. Non-PR buyers often need additional arrangements (Japanese guarantor, higher down payment, specialized lender). Banks like Shinsei note that without PR, a Japanese/PR spouse as co-borrower or guarantor is often required.

Cash Purchase vs. Mortgage: What to Consider

Foreign buyers should weigh paying cash against financing:

Cash Purchase

If you have the funds, buying with cash is often simpler for buying property in Japan. You avoid loan approval, guarantee fees, interest costs, and currency risks. Non-PR buyers especially benefit from cash purchases since they may not easily qualify for loans. Without a loan, closing can happen faster and with less bureaucracy (no mortgage application, appraisal, etc.). The downside is obviously needing a large capital outlay and forgoing the leverage of a loan.

Mortgage Purchase

Loans expand your buying power and preserve liquidity when purchasing a house. For PR holders with strong income, mortgages (at historically low Japanese rates) make sense. Loan buyers must budget 1–2% of the loan for initial fees (such as guaranty company fees or loan origination fees) and bear ongoing interest expense. Foreign borrowers should also consider currency risk if their income is in another currency (a yen loan with a weak yen might be advantageous today, but if the yen strengthens later, repayment becomes costlier in home-currency terms).

Differences (PR vs Non-PR)

Permanent residents can often obtain mortgage financing at similar down-payment requirements as Japanese (e.g. 10–20%). Non-PR buyers usually need higher down payments (often 20–30% of price) or a Japanese guarantor. In short, cash is more attractive to non-PR buyers due to loan difficulty, whereas PR buyers have the option to use loans more flexibly.

Insight: Cash avoids loan hassles (critical for non-residents or non-PR). Financing with a mortgage increases price range but adds approval risk and costs. Each buyer must compare loan terms vs. cash costs in their situation.

Property Types in Japan

When looking to buy a house in Japan, you'll encounter various property types:

• Apartments (Mansions): These are condominiums, typically in mid-to-high-rise buildings. They're common in urban areas like Tokyo and often come with shared facilities and management fees.
• Detached Houses: Stand-alone homes with their own land. These are more common in suburban and rural areas.
• Land: You can purchase land separately and build your own home. This is particularly relevant if you're interested in buying land in Japan for custom construction.
• Vacant Houses (Akiya): Japan has many vacant houses, especially in rural areas. These can be very cheap houses but often require renovation.
• Investment Properties: Properties specifically bought for rental income or appreciation, popular in major cities.

Regional Differences

The property market varies significantly across Japan:

• Tokyo: Offers high prices and strong rental markets, making it attractive for investment but challenging for affordable housing.
• Osaka and Other Major Cities: Generally more affordable than Tokyo while still offering urban amenities.
• Kyoto: Known for traditional properties and strict building regulations to preserve cultural heritage.
• Rural Areas: Can offer significantly cheaper properties, including land and houses, but may lack amenities and rental potential.

Typical Fees and Cost Breakdown

When budgeting to buy property in Japan, remember the "諸費用" (miscellaneous costs) on top of the purchase price. For a foreigner (as for any buyer), these can total roughly 5–10% of the property price. Major items include taxes, professional fees, and agent commissions. A typical breakdown is:

Expense	Who Pays	Rate/Amount	Notes
Real estate agent commission	Buyer (if seller is private individual)	Up to 3% of price + ¥60,000 (plus 10% tax)	Legally capped at 3% of sale price (excl. tax). Payable in two installments (50% at contract, 50% at closing).
Stamp duty on contracts	Buyer	¥5,000–¥60,000 (approx.)	Fixed tax for stamping documents. E.g. sale contract for ¥50M requires ¥30K stamp. (Roughly 0.01–0.06% of price.)
Registration taxes (移転登記)	Buyer (via judicial scrivener)	• Land transfer: 2.0% of assessed price• Building transfer: 2.0% (used) or 0.4% (new)• Mortgage registration: 0.4% (each of land and building)	Based on official tax rates. Reduced rates often apply: e.g. 0.4% for transfer of a new home's building.
Judicial scrivener fee	Buyer	~¥100,000 – ¥200,000 total	Fee to prepare and file the registration documents. Often bundled with transfer; about ¥10–20K per hour work.
Loan-related fees (if any)	Buyer	~¥100,000 – ¥300,000+	Includes guarantee company fee (if required, often 1–2% of loan), loan origination fee, bank transfer fee. Varies by lender.
Acquisition tax (取得税)	Buyer (after purchase)	≈3–4% of assessed property value	One-time property acquisition tax by prefecture, based on assessed value. Rates are typically 3–4% (often 3%). Some first-home exemptions may apply.
Fixed asset tax (固定資産税)	Owner (annually)	≈1.4% of assessed value (per year)	Annual municipal property tax; based on fixed asset tax assessment (generally ~60% of market value).
City planning tax (都市計画税)	Owner (annually)	≈0.3% of assessed value (per year)	Applies in designated city planning areas. Paid together with fixed asset tax.
Condo fees (if applicable)	Owner (monthly)	Varies widely	Ongoing maintenance (管理費) and repair reserve (修繕積立金) for condominiums. (Example: ¥15,000–¥30,000/month for a mid-sized Tokyo apartment.)

For example, purchasing a ¥30 million used home might incur roughly:

• ¥900K (3%) broker fee
• ¥30K stamp duty
• ¥600K registration tax
• ¥100K scrivener fee
• ¥100K loan fees
• ¥900K acquisition tax = ¥2.63M (~8.8% of price) in extra costs

These costs scale with price. Always plan on several percent overhead beyond the purchase price.

Insight: Foreign buyers pay the same purchase taxes and fees as Japanese. Factor in 5–10% extra (or more for luxury) on top of the home's price. The largest items are usually agent commissions (3%) and various registration taxes.

Special Considerations for Foreigners

When buying property in Japan as a foreigner, be aware of these additional considerations:

Language Barriers

Unless you're fluent in Japanese, communication can be challenging. Consider working with bilingual real estate agents, lawyers, or translators who specialize in helping foreign clients navigate the Japanese property market.

Visa Status

While you don't need a visa to buy property, your visa status affects your ability to live in the property and get financing. Having permanent residency makes the process much smoother, especially for obtaining mortgages.

Financing Challenges

As detailed earlier, getting a mortgage can be difficult without permanent residency. Prepare for potentially stricter requirements, higher down payments, or the need for a Japanese guarantor.

Tax Implications

Foreign property owners face the same property taxes as Japanese citizens, but there might be additional reporting requirements in your home country. Consider consulting with a tax professional familiar with both Japanese and your home country's tax laws.

Cultural Differences

The real estate transaction process in Japan differs from many Western countries. Understanding cultural nuances in negotiation, contract signing, and business relationships can help smooth the process.

Conclusion: Is Buying Property in Japan Right for You?

Buying a house in Japan as a foreigner is not only possible but can also be a rewarding experience—whether for personal use, as a vacation home, or as an investment. The Japanese real estate market offers stability, quality construction, and relatively affordable options compared to many global cities.

With proper preparation, research, and the help of experienced real estate professionals, your journey to becoming a property owner in Japan can be both successful and fulfilling. The process might seem complex initially, especially regarding financing and documentation, but the benefits of owning property in this fascinating country can make it worthwhile.

If you're ready to start your home buying journey in Japan, contact our team of experienced real estate agents today. We specialize in helping foreigners navigate the Japanese property market—from Tokyo homes to countryside retreats.