Japan — Property: Buying Process

Key facts

• MLIT English materials call the law the Building Lots and Buildings Transaction Business Act (Takuchi Tatemono Torihiki Gyoho, the Real Estate Brokerage Act).
• Article 35 requires a licensed transaction specialist to explain the important matters in writing before the contract, showing the licence card; the matters cover private-law and public-law rights in the property, the status of urban facilities and transaction terms.
• Since August 2020 the explanation must state whether the property lies in a flood hazard map area under the Flood Control Act.
• MLIT has said online explanations count the same as in-person ones for sales from March 2021.
• MLIT also publishes a flow of real estate transactions and a summary of the major taxes on transfer of real estate in English.

Steps

1. Search and viewing — Identify and view properties, often through a licensed real estate agent.
2. Contract negotiation and signing — Agree terms and sign the purchase contract, paying a deposit (typically 5-10%).
3. Due diligence — Review the mandatory Important Matters Explanation covering legal status, zoning, and known defects.
4. Mortgage application (if financing) — Apply to a lender; approval timelines vary by residency status.
5. Final settlement — Pay the balance and transfer title, typically a few weeks to ~2 months after contract signing.
6. Title registration — A judicial scrivener files registration at the Legal Affairs Bureau, usually completed within a few business days.
7. FEFTA reporting (non-residents) — File Form 22 with the Bank of Japan/Ministry of Finance within 20 days of acquisition.

Related topics