Financial Preparation

• Determine your total investment budget (property + transaction costs + reserves)
• Establish a currency exchange strategy (consider JPY volatility)
• Research historical USD/JPY or CAD/JPY exchange rates to identify favorable timing
• Set up international wire transfer capabilities with your home bank
• Consider opening a Japanese bank account (challenging but possible for non-residents)
• Evaluate tax implications in both Japan and your home country
• Arrange financing if needed (limited options for non-residents)

Market Research

• Identify target cities based on investment goals (Tokyo for stability, regional cities for yield)
• Research neighborhood-specific price trends and rental yields
• Join online forums for foreign property investors in Japan
• Subscribe to property market reports (REINS, Mizuho, CBRE)
• Analyze demographic trends and population projections for target areas
• Research tenant demographics and rental demand in target areas
• Understand Japanese housing preferences and cultural considerations
• Plan a preliminary market visit or virtual property tours

Professional Network Development

• Connect with bilingual real estate agents specializing in foreign clients
• Identify judicial scriveners (司法書士, shihō shoshi) for property registration
• Research property management companies with English-speaking staff
• Establish contact with currency exchange specialists (e.g., Wise, OFX)
• Find Japanese-speaking tax professionals familiar with your home country
• Connect with building inspection services with experience in Japanese construction
• Consider property investment consultants specializing in the Japanese market

Expert Tip: Japanese real estate uses unique metrics like “tsubo” (approximately 3.3 square meters) for measuring property size and “heibei-tanka” (price per square meter) for valuation. Familiarize yourself with these terms and typical ranges in your target area. Additionally, new properties in Japan depreciate significantly in the first few years—unlike most Western markets—while very old properties (40+ years) may have most of their value in the land rather than the building.

Recent Regulatory Change: Japan has implemented the Foreign Exchange and Foreign Trade Act (FEFTA) reporting requirements for certain properties. While not a restriction on ownership, this requires post-transaction reporting to the Bank of Japan for properties in designated areas or sectors. This primarily affects properties near defense installations, on remote islands, or in sensitive industries. Most urban residential investments are unaffected, but verification during due diligence is recommended.

Banking Setup

• Japanese Bank Account Options:
  • Major Japanese banks: Challenging for non-residents without local presence
  • International banks with Japanese branches: SMBC, MUFG, Mizuho often better for foreign clients
  • Prestia (formerly Citibank Japan): More foreigner-friendly services
  • Online banks: SBI Shinsei Bank offers English services
• Typical Requirements:
  • Passport/identification
  • Residence card (for residents)
  • Personal seal (hanko) or signature
  • Proof of Japanese address (major challenge for non-residents)
  • Tax identification number
  • In-person application (for most banks)
• Alternative Approach: Many foreign investors complete property transactions without a Japanese bank account by using their real estate agent or solicitor’s client account and international wire transfers. For ongoing management, property management companies can collect rent and pay expenses, remitting net proceeds internationally.

Financing Options

While cash purchases are common among foreign investors, limited financing options include:

1. Japanese Mortgages for Foreign Nationals:
   • Availability: Very limited for non-residents; more options for residents
   • Lenders: Primarily Shinsei Bank, Suruga Bank, and some regional banks
   • Deposit Requirements: Typically 30-50% for foreign buyers
   • Interest Rates: 1.5-3% variable rates (significantly lower than most Western countries)
   • Term: Usually 10-35 years with age limitations (loan term + age typically capped at 65-75)
   • Documentation: Extensive, including income verification, employment history, and personal financial statements
2. International Mortgages:
   • Select international banks may offer financing to their private banking clients
   • Often requires substantial relationship minimums
   • May consider global assets and income
   • Typically higher interest rates than domestic Japanese loans
3. Home Country Financing:
   • Refinancing existing properties in North America
   • Home equity lines of credit (HELOCs)
   • Securities-backed loans against investment portfolios
   • May offer better terms than the limited Japanese options for non-residents

Currency Management

The Japanese Yen (JPY) has historically been volatile against the USD and CAD, creating both risks and opportunities:

• Exchange Rate Considerations:
  • Monitor JPY/USD and JPY/CAD trends to identify favorable exchange windows
  • Consider working with a currency specialist offering rate alerts
  • Remember that strong USD/CAD means more purchasing power in Japan
• Currency Services:
  • Specialized services like Wise, OFX, or Revolut typically offer better rates than banks
  • Forward contracts can lock in exchange rates for future payments
  • Regular payment services for ongoing costs like maintenance fees
• Income Repatriation:
  • Consider timing of rental income transfers to home country
  • Set up automated regular transfers to average out exchange rate fluctuations
  • Maintain accurate records for tax purposes in both countries

The Yen’s status as a “safe haven” currency means it often strengthens during global economic uncertainty, which can impact your effective returns when measured in your home currency. Strategic currency management should be an integral part of your investment plan, especially for larger portfolios.

Property Search Resources

• Online Property Portals:
  • HOMES – Major portal with English interface
  • Real Estate Japan – English-language listings aimed at foreigners
  • SUUMO – Largest Japanese portal (Japanese language)
  • AtHome – Comprehensive listings (Japanese language)
• Real Estate Agencies:
  • Major agencies with English services: Century 21, RE/MAX, Mitsui Real Estate
  • Foreign investor specialists: Japan Property Central, Housing Japan, NTI
  • Local agencies in target areas (typically require Japanese language)
  • Note: Japanese agencies often represent properties exclusively, requiring multiple agency contacts
• Property Auctions:
  • Court auctions (司法競売, shihou keibaai) can offer discounted properties
  • Require significant Japanese language ability or local representation
  • Often don’t allow property inspection before bidding (higher risk)
  • Institutional knowledge needed to navigate the process
• Buying Agents:
  • Represents buyer rather than seller (highly recommended for foreign investors)
  • Access to multiple listing systems and exclusive properties
  • Negotiation expertise and market knowledge
  • Typically charge 3% of purchase price plus ¥60,000 (standard rate)

Property Viewing Trip Planning

For overseas investors, an efficient property viewing trip is essential:

1. Pre-Trip Research:
   • Identify 10-15 potential properties before arrival
   • Schedule viewings in advance (properties move quickly in desirable areas)
   • Research neighborhoods thoroughly online
   • Arrange meetings with agents, lawyers, and property managers
2. Trip Logistics:
   • Plan at least 4-7 days per city being considered
   • Use a consistent base location to avoid hotel changes
   • Schedule viewings in geographical clusters
   • Leave time for neighborhood exploration and transit testing
3. During Viewings:
   • Take detailed photos and notes
   • Ask about building age, construction method, and earthquake resistance
   • Inquire about management association fees and building reserves
   • Check proximity to transportation, convenience stores, and amenities
   • Consider street noise, natural light, and building condition
4. Alternative: Remote Purchasing with a trusted local representative who can:
   • Conduct virtual tours via video call
   • Arrange professional inspections
   • Provide detailed documentation and measurements
   • Represent your interests throughout the process

Property Evaluation Criteria

Assess potential investments using these key criteria:

• Location Factors:
  • Distance to nearest train/subway station (crucial in Japan)
  • Walking distance to amenities (convenience stores, restaurants)
  • School districts (for family rentals)
  • Safety of neighborhood (crime rates are generally very low)
  • Proximity to major employment centers
  • Future development and infrastructure projects
• Building Quality:
  • Age and construction material (木造, mokuzou = wooden; 鉄筋コンクリート, tekkin konkurito = reinforced concrete)
  • Earthquake resistance certification (耐震基準, taishin kijun) – especially for buildings pre-1981
  • Renovation history and condition
  • For apartments: management company reputation and reserve fund status
  • For houses: foundation condition, roof quality, insulation standard
  • Potential maintenance or renovation requirements
• Rental Potential:
  • Rental yield compared to area average
  • Tenant demographics in the area (students, professionals, families)
  • Typical vacancy rates for similar properties
  • Potential for value-add improvements
  • Furnishing requirements and costs
  • Competitive position within the local market
• Financial Considerations:
  • Price per square meter compared to area average
  • Management fees and building reserve contributions
  • Property tax assessment (固定資産税, kotei shisan zei)
  • Insurance costs
  • Potential capital appreciation based on local trends
  • Exit strategy considerations

Expert Tip: When evaluating Japanese properties, pay special attention to the building’s earthquake resistance standards. Buildings constructed before 1981 were built to older seismic codes and may require costly retrofitting or face higher insurance premiums. Newer buildings will have documentation of their earthquake resistance rating, with ratings of 1.0 or higher being desirable. Also, note that Japanese listings typically state “minutes to station” based on an adult’s walking pace of 80m per minute—verify this claim during property viewing as it significantly impacts rental demand.

Legal Due Diligence

• ✓
  Registry Verification (登記簿謄本, toukibo touhon): Confirm ownership and identify any existing liens or encumbrances
• ✓
  Property Rights Confirmation: Verify boundaries and any shared ownership issues
• ✓
  Zoning Verification: Check permitted uses, building-to-land ratio, and floor area ratio
• ✓
  Seller’s Disclosure Statement (告知書, kokuchisho): Review all disclosed defects and issues
• ✓
  Environmental Assessment: Check for contamination, flooding risk, and soil stability
• ✓
  Building Management Rules: Review bylaws and regulations (for apartments/condos)
• ✓
  Management Association Records: Verify sound financial condition and adequate reserves
• ✓
  Historic Preservation Status: Check if building has protected status limiting modifications

Physical Due Diligence

• ✓
  Building Inspection: Conducted by qualified inspector familiar with Japanese construction
• ✓
  Earthquake Resistance Verification: Obtain earthquake-resistance certification or inspection
• ✓
  Major Systems Check: Evaluate plumbing, electrical, heating/cooling systems
• ✓
  Moisture/Mold Assessment: Critical in Japan’s humid climate, especially for wooden structures
• ✓
  Common Areas (if applicable): Inspect maintenance, security, accessibility
• ✓
  Amenities Verification: Confirm all advertised features are present and functional
• ✓
  Renovation Assessment: Obtain estimates if improvements planned

Financial Due Diligence

• ✓
  Comparative Market Analysis: Verify price aligns with recent comparable sales
• ✓
  Rental Market Research: Confirm realistic rental expectations (speak to local agents)
• ✓
  Tax Assessment: Verify property tax (固定資産税, kotei shisan zei) and city planning tax (都市計画税, toshi keikaku zei) amounts
• ✓
  Running Cost Assessment: Calculate all ownership expenses (management fees, utilities, insurance)
• ✓
  ROI Calculation: Develop detailed cash flow projections and return analysis
• ✓
  Future Building Repair Plans: Review long-term maintenance schedule and special assessments

Expert Tip: Unlike many Western countries, Japan does not have a standardized home inspection industry, and many properties are sold without independent inspections. Consider hiring a qualified architect or building engineer (一級建築士, ikkyū kenchikushi) to conduct a thorough assessment, especially for older properties. Be particularly vigilant about earthquake resistance standards, as buildings constructed before 1981 follow older seismic codes. For apartment buildings, carefully review the repair reserve fund status (修繕積立金, shūzen tsumitatekin) as inadequate reserves may lead to large special assessments in the future.

Offer and Application

1. Property Application (申込書, mōshikomisho): Written expression of intent to purchase
2. Application Fee (申込金, mōshikomikin): Typically ¥100,000-200,000 (refundable if deal falls through)
3. Initial Disclosure: Review of property condition report and disclosure statements
4. Preliminary Terms: Agreement on price, timing, and basic conditions

Unlike North America, the Japanese property transaction process typically doesn’t involve competitive bidding. Properties are often listed with a fixed price, and negotiations tend to have narrower margins. The application deposit demonstrates serious intent but does not create a legally binding purchase agreement at this stage.

Contract and Purchase Process

1. Explanation of Important Matters (重要事項説明, jūyō jikō setsumeisho):
   • Legally required comprehensive disclosure document
   • Must be explained by a licensed real estate agent
   • Covers property details, restrictions, defects, and transaction terms
2. Purchase Agreement (売買契約, baibai keiyaku):
   • Formal contract specifying all terms of the transaction
   • Both parties sign and seal (with registered hanko for Japanese buyers)
   • Foreign buyers can typically use signatures instead of seals
3. Deposit Payment (手付金, tetsukekin):
   • Typically 10% of purchase price
   • Paid upon contract signing
   • Usually non-refundable except in specific circumstances
4. Preparation Period:
   • Final due diligence completion
   • Mortgage arrangements (if applicable)
   • Preparation of closing documents
5. Settlement and Closing (決済・引渡し, kessai・hikiwatashi):
   • Balance of payment transferred
   • Property registration transferred to buyer’s name
   • Keys and property handed over
6. Post-Settlement:
   • Property tax notifications updated
   • Utility transfers
   • Management company registration (for apartments)

The timeframe from application to settlement typically ranges from 1-3 months, with most transactions completing within 30-45 days. The process is generally more streamlined than in many Western countries, with fewer contingencies and a more standardized approach.

Transaction Costs

Budget for these typical transaction expenses:

• Registration Tax (登録免許税, tōroku menkyozei):
  • 1.5-2% of property value for land and building ownership transfer
  • 0.4-0.5% for new mortgages
• Real Estate Acquisition Tax (不動産取得税, fudōsan shutoku zei):
  • 3-4% of assessed value (with some reductions for residential property)
  • Varies slightly by prefecture
• Stamp Duty (印紙税, inshi zei): ¥10,000-60,000 depending on purchase price
• Real Estate Agent Fee: 3% of purchase price + ¥60,000 + consumption tax (standard)
• Judicial Scrivener Fee: ¥80,000-150,000 for registration services
• Legal Fees: ¥200,000-500,000 if using an attorney (optional but recommended for foreigners)
• Property Management Company Setup: ¥30,000-50,000 for initial registration

Total transaction costs for buyers typically range from 6-8% of the purchase price. Unlike some countries, Japan does not impose additional taxes or surcharges on foreign buyers, creating a level playing field for international investors.

Expert Tip: In Japan, real estate transactions traditionally use a personal seal (印鑑, inkan) rather than signatures. Foreign buyers can usually use signatures instead, but this should be confirmed with your judicial scrivener in advance. For remote purchases, a power of attorney can be arranged, though it will likely need to be notarized and apostilled in your home country. Many foreign investors now complete purchases remotely with proper representation, especially since the pandemic normalized this process.

Administrative Tasks

• ✓
  Property Registration (所有権移転登記, shoyūken itenjō tōki): Ensure property is registered in your name (typically handled by judicial scrivener)
• ✓
  Property Tax Registration: Submit ownership change to local tax office
• ✓
  Utility Transfers: Setup electricity, gas, water, internet services
• ✓
  Insurance: Arrange comprehensive property insurance (fire, earthquake, liability)
• ✓
  Management Association: Register with building management for apartments/condos
• ✓
  Building Management: Establish relationship with property manager if using one
• ✓
  Foreign Asset Reporting: Report property acquisition to home country tax authorities if required

Regulatory Compliance

Japanese rental properties must comply with various regulations:

• Building Safety Standards:
  • Fire safety equipment must be properly maintained
  • Earthquake resistance standards must be met and disclosed
  • Annual building inspections for larger structures
• Rental Property Requirements:
  • Proper ventilation and minimum daylight standards
  • Functional emergency exits and fire safety equipment
  • Basic security features (proper locks, intercom systems)
  • Sanitary facilities and pest control
• Lease Regulations:
  • Lease agreements must comply with Japanese tenancy laws
  • Security deposits (敷金, shikikin) subject to specific return requirements
  • Key money (礼金, reikin) and other fees must be clearly disclosed
  • Renewal and termination procedures must follow legal standards
• Management Obligations:
  • Provision of essential services (water, heat, etc.)
  • Timely response to maintenance requests
  • Privacy protections for tenant information
  • Proper handling of security deposits

Japan has relatively landlord-friendly rental laws compared to many Western countries, with fewer restrictions on rent increases and more straightforward eviction procedures for non-payment. However, proper documentation and following established legal processes are essential.

Record Keeping

Maintain comprehensive records for tax and legal purposes:

• Property Documents:
  • Purchase contract and settlement statement
  • Property registry documents (登記簿謄本, toukibotohon)
  • Building inspection reports and certificates
  • Floor plans and property specifications
  • Building management rules and regulations
• Financial Records:
  • All property-related expenses with receipts
  • Mortgage statements (if applicable)
  • Management fee payments and building reserve contributions
  • Insurance policies and payments
  • Rental income and tenant deposits
  • Currency exchange transactions
• Tax Documentation:
  • Annual property tax (固定資産税, kotei shisan zei) statements
  • Japanese income tax returns (if filed)
  • Home country tax declarations
  • Depreciation schedules and calculations
  • Capital improvement records
• Tenant Information:
  • Lease agreements and amendments
  • Tenant identification and contact information
  • Security deposit records
  • Inspection reports and inventories
  • Maintenance request history

Japanese tax authorities generally require records to be kept for 7 years. For foreign investors, maintaining duplicate records in both Japan and your home country is advisable, with digital copies securely backed up.

Expert Tip: Japan’s mail forwarding system doesn’t work well for international addresses, making it challenging to receive important property-related mail when overseas. Consider appointing a local representative or using mail scanning services like Japan Post’s digital mailbox service or specialized providers such as TokyoRental.com’s mail handling service. These services can scan and email important documents, ensuring you don’t miss tax notices, building management communications, or utility bills.

Japanese Tax Obligations

• Property Acquisition Taxes:
  • Registration Tax (登録免許税, tōroku menkyozei): 1.5-2% of property value
  • Real Estate Acquisition Tax (不動産取得税, fudōsan shutoku zei): 3-4% of assessed value
  • Stamp Duty (印紙税, inshi zei): Based on purchase price (¥10,000-60,000)
  • Consumption Tax (消費税, shōhizei): 10% on certain new properties (residential properties generally exempt)
• Annual Property Taxes:
  • Fixed Asset Tax (固定資産税, kotei shisan zei): 1.4% of assessed value annually
  • City Planning Tax (都市計画税, toshi keikaku zei): 0.3% of assessed value annually
  • Both billed annually, typically in April
  • Assessment value usually 50-70% of market value
• Income Tax on Rental Income:
  • Progressive taxation from 5-45% based on income level
  • Non-residents pay flat 20.42% (including restoration tax)
  • Allowable deductions include depreciation, management fees, insurance, repairs, property taxes
  • Annual tax return filing deadline: March 15
• Capital Gains Tax:
  • Short-term (held under 5 years): 39.63% (including local taxes)
  • Long-term (held over 5 years): 20.315% (including local taxes)
  • Must be reported within 4 months of the end of the year in which the sale occurred
  • Special exemptions may apply for primary residences (rarely applicable to foreign investors)
• Inheritance and Gift Tax:
  • Progressive rates from 10% to 55% depending on amount
  • Non-residents may be subject to these taxes on Japanese properties
  • Complex rules regarding eligibility and foreign assets
  • Proper estate planning recommended for substantial investments
• Consumption Tax (VAT):
  • 10% on services related to property (management, repairs, etc.)
  • Generally not applicable to residential rent
  • May apply to commercial property rentals

Home Country Tax Obligations

Japan has tax treaties with both the United States and Canada which help prevent double taxation. However, the interaction between tax systems is complex and requires professional guidance from advisors familiar with both jurisdictions. In particular, depreciation calculations differ significantly between countries, creating potential tax mismatches.

Tax Planning Strategies

• Entity Structure: Evaluate whether personal ownership, Japanese GK company, or other structures optimize tax position
• Depreciation Optimization: Japanese tax code allows accelerated depreciation for wooden structures (22-year schedule)
• Expense Tracking: Maintain meticulous records of all allowable expenses to maximize deductions
• Strategic Timing: Consider tax year implications for property acquisition and disposition
• Loss Offsetting: Structure investments to potentially offset losses against other income where permitted
• Inheritance Planning: Explore structures to mitigate Japanese inheritance tax exposure
• Tax Treaty Benefits: Utilize provisions in relevant tax treaties to minimize double taxation
• Property Portfolio Allocation: Balance Japanese investments with global property holdings for tax efficiency

Tax rules change frequently in both Japan and North America. Regular consultations with tax professionals in both jurisdictions are essential to ensure continued compliance and optimal structuring.

Expert Tip: Japan’s depreciation rules can significantly benefit real estate investors. Buildings are depreciated separately from land, with wooden structures depreciating over 22 years, reinforced concrete over 47 years, and steel-frame over 34 years. Additionally, you can separately depreciate building components like air conditioning (15 years), elevators (17 years), and fixtures. This accelerated depreciation often creates paper losses in the early years of ownership, even with positive cash flow. Work with a tax professional familiar with Japanese real estate to maximize these legitimate deductions.

Selecting a Property Manager

Evaluate potential property managers using these criteria:

• Experience with Foreign Investors:
  • English language capabilities
  • Experience handling international wire transfers
  • Understanding of non-resident tax implications
• Professional Accreditations:
  • Licensed real estate transaction specialist (宅地建物取引士, takuchi tatemono torihikishi)
  • Member of property management associations
  • Licensed rental property manager (賃貸不動産経営管理士, chintai fudōsan keiei kanrishi)
• Market Knowledge:
  • Specialization in your property type/location
  • Understanding of local rental market trends
  • Established tenant network
• Client Communication:
  • Regular reporting in your preferred language
  • Digital payment systems for international transfers
  • Responsive to inquiries across time zones
• Maintenance Network:
  • Reliable contractors for repairs
  • Emergency response procedures
  • Transparent fee structure for works
• Tenant Management:
  • Thorough screening process
  • Proper handling of security deposits
  • Effective rent collection systems

Management Agreement Essentials

Ensure your property management contract includes these key elements:

• Scope of Services: Detailed description of exactly what is included and excluded
• Fee Structure: Clear explanation of all management fees, commissions, and additional charges
• Contract Term and Notice Period: Duration of agreement and termination procedures
• Reporting Schedule: Frequency and format of financial and property condition reports
• Maintenance Authority: Spending limits for repairs without prior approval
• Tenant Selection Criteria: Parameters for approving potential tenants
• Rent Collection Procedures: Methods, timing, and handling of arrears
• Insurance Requirements: Coverage expectations and liability boundaries
• Language Provisions: Designated language for communications and reports
• Fund Remittance: Process and timing for transferring rental income to overseas accounts

Request references from other foreign clients before signing with a property management company. Japanese business relationships are highly relationship-based, so establishing trust and clear communication channels is particularly important in this market.

Expert Tip: Japanese rental agreements typically follow a unique structure including key money (礼金, reikin), security deposits (敷金, shikikin), and renewal fees (更新料, kōshinryō) that differ from Western practices. A good property manager will explain these cultural norms while helping you maximize your returns. For instance, while key money (essentially a non-refundable gift to the landlord) is traditional in Japan, its prevalence varies by region and property type—your manager should know when it’s standard to charge it and when waiving it might attract better tenants more quickly.

Exit Options

Sale Process

When selling your Japanese property:

1. Pre-Sale Preparation:
   • Property preparation and staging
   • Gathering necessary documentation
   • Addressing maintenance issues
   • Consider vacant possession vs. tenanted sale
2. Agent Selection:
   • Local expertise in your property type
   • Marketing capability to appropriate buyer segments
   • Commission structure (typically 3% + ¥60,000 + tax)
   • Experience with foreign seller transactions
3. Property Valuation:
   • Market analysis of comparable properties
   • Assessment of current building condition
   • Consideration of land value vs. building value
   • Strategic pricing based on market conditions
4. Marketing Period:
   • Professional photography and floor plans
   • Online and print advertising
   • Property viewings (typically conducted by agent)
   • Negotiation with potential buyers
5. Transaction Process:
   • Explanation of Important Matters document preparation
   • Purchase and sale agreement
   • Deposit receipt (typically 10%)
   • Settlement preparation
   • Property handover
6. Post-Sale Requirements:
   • Capital gains tax filing (within 4 months of year-end)
   • Currency repatriation
   • Notification to relevant authorities
   • Cancellation of insurance and utilities

The Japanese property selling process typically takes 2-4 months from listing to completion. Foreign sellers should ensure they have proper representation, particularly for tax matters, as capital gains tax filing is required even after leaving Japan.

Market Exit Timing Considerations

Several factors should influence your exit timing decision:

• Currency Exchange Rates: Monitor JPY/USD or JPY/CAD trends; the yen’s “safe haven” status means it often strengthens during global economic uncertainty
• Local Real Estate Cycles: Japanese property markets move differently than Western markets, with generally slower cycles
• Interest Rate Environment: Japan’s historically low interest rates create unique market dynamics
• Political and Regulatory Climate: Government policies regarding foreign investment and property taxation
• Regional Growth Trends: Different Japanese cities experience growth phases at different times
• Building Age Considerations: Japanese properties typically depreciate more rapidly than in Western markets
• Tax Position Optimization: Timing sales relative to tax years in both Japan and home country
• Major Infrastructure Projects: Completion of nearby developments or transport improvements

Japanese real estate is viewed differently from many Western markets—with buildings (but not land) considered depreciating assets, exit strategy planning should account for the unique aspects of the market. Buildings older than 30 years typically see diminishing returns, while land in prime locations tends to maintain or increase in value over time.

Expert Tip: The Japanese property market has significant seasonality that can impact your exit timing. The most active buying periods typically occur in January-March (before the fiscal year change in April) and September-October (after summer holidays). University cities see increased demand in January-February before the April academic year begins. Additionally, property age is extremely important in Japan, with buildings over 30 years old often seeing substantial price discounts—consider timing your exit before this significant milestone if your property is approaching this age.