Property Buying Costs and Taxes in Japan
This page explains the necessary costs and taxes for buying a property in Japan including explanations and examples.
This easy to follow guide is for anyone interested in purchasing property in Japan whether you’re an experienced real estate investor or a first-time home buyer.
Costs and taxes required when buying property
The table below describes property buying costs and taxes covering the stages of the purchase process from signing a contract to tax payment.
When signing a contract
| Documentary stamp tax required for the sales contract. |
| 10 to 20% of the sales price |
When applying for a housing loan
| Documentary stamp tax required for the loan contract. |
When settling the remaining payment
| Remaining sum of the sales price of the property | |
|---|---|
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| 3% of the sales price + 60,000 yen + consumption tax in accordance with property transaction regulations. | |
| For registering ownership transfer or mortgage on a property. | |
| Fee for conducting ownership transfer and necessary related registration. | |
Tax payment after buying a property
| Tax on upon the purchase of property. Approximately 6 months to a year after buying a property, all necessary documents related to the tax are sent by the tax office responsible for the property. |
Examples of Property Buying Costs
Here are some examples of buying costs for a house and an apartment.
You can download PDF version of “Examples of Property Buying Costs”.
| Property summary | |||
|---|---|---|---|
| Property type | House | ||
| Land Size | 151.48 sq.m. | Land Appraisal value | ¥45,042,560 |
| Building Size | 206.85 sq.m. | Building Appraisal value | ¥11,148,500 |
| Payments | ||
|---|---|---|
| Own funding | ¥38,698,660 | |
| Loan | ¥112,000,000 | |
| Life of loan | 35 years | |
| Loan type | Bank Loan | |
| Loan rate | 2.475% | |
| Total | ¥150,698,660 | |
| Expenses | |
|---|---|
| Sales price | ¥140,000,000 |
| Miscellaneous costs | ¥10,698,660 7.64% of the sales price. |
| Total | ¥150,698,660 |
| Breakdown of expenses | |||
|---|---|---|---|
| When signing a contract | Deposit | ¥14,000,000 | |
| Stamp duty | ¥80,000 | ||
| When applying for a housing loan | Stamp duty | ¥100,000 | |
| When settling the remaining fees | Loan | Bank commission | ¥31,500 |
| Guarantee charges | ¥2,308,432 | ||
| Fire insurance premium | ¥800,000 | ||
| Remaining sum of the sales price of the property | ¥126,000,000 | ||
| Settlement money on a pro-rate basis | Fixed Asset Tax / City Planning Tax |
¥174,900 | |
| Agent commission (3%＋¥60,000＋consumption tax) | ¥4,686,000 | ||
| Registration costs | ¥1,507,828 | ||
| Tax payment | Real Estate Acquisition Tax | ¥1,010,000 | |
| Total | ¥150,698,660 | ||
This is just a example.
Please be advised that the information may vary depending on properties and financial institutions.
| Property summary | |||
|---|---|---|---|
| Property type | Apartment | Exclusive Size | 50.06 sq.m. |
| Land Appraisal value | ¥6,581,388 | Building Appraisal value | ¥6,103,000 |
| Payments | ||
|---|---|---|
| Own funding | ¥10,237,998 | |
| Loan | ¥40,000,000 | |
| Life of loan | 25 years | |
| Loan type | Bank Loan | |
| Loan rate | 2.65% | |
| Total | ¥50,237,998 | |
| Expenses | |
|---|---|
| Sales price | ¥47,000,000 |
| Miscellaneous costs | ¥3,237,998 6.89% of the sales price. |
| Total | ¥50,237,998 |
| Breakdown of expenses | |||
|---|---|---|---|
| When signing a contract | Deposit | ¥4,700,000 | |
| Stamp duty | ¥15,000 | ||
| When applying for a housing loan | Stamp duty | ¥20,000 | |
| When settling the remaining fees | Loan | Bank commission | ¥42,000 |
| Guarantee charges | ¥690,160 | ||
| Remaining sum of the sales price of the property | ¥42,300,000 | ||
| Settlement money on a pro-rate basis | Fixed Asset Tax / City Planning Tax |
¥313,200 | |
| Management fee / Repairing fund |
¥17,241 | ||
| Agent commission(3%＋¥60,000＋consumption tax) | ¥1,617,000 | ||
| Registration costs | ¥425,000 | ||
| Tax payment | Real Estate Acquisition Tax | ¥98,397 | |
| Total | ¥50,237,998 | ||
This is just a example.
Please be advised that the information may vary depending on properties and financial institutions.
Tax Guidance
The table below shows the lists for taxes related to the purchasing of property in Japan.
Taxes charged when purchasing
Stamp Duty (National Tax)
A stamp duty is levied on each contract. The following amount of tax is to be paid for a stamp and it is to be affixed to a contract after *Reducing Measures being added.
| Price on Contract | Construction Contract | Real Estate Sales Contract | Loan Contract |
|---|---|---|---|
| Less than ¥1M | ¥200 | ¥500 | ¥1,000 |
| Less than ¥5M | ¥200-1,000 | ¥1,000 | ¥2,000 |
| Less than ¥10M | ¥5,000 | ¥5,000 | ¥10,000 |
| Less than ¥50M | ¥10,000 | ¥10,000 | ¥20,000 |
| Less than ¥100M | ¥30,000 | ¥30,000 | ¥60,000 |
| Less than ¥500M | ¥60,000 | ¥60,000 | ¥100,000 |
| Less than ¥1B | ¥160,000 | ¥160,000 | ¥200,000 |
*Reducing Measures :
The above amount is applicable for a real estate sales contract and for construction concluded by 31 March 2024.
Registration and License Tax (National Tax)
It is a Tax levied on the registration of preservation, transfer of ownership, or establishment of a mortgage on a property. A separate registration is required for land and building.
| Category | Tax Rate for Registration (Reg.) | |
|---|---|---|
| New Residence | Land |
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| Building |
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| Pre-owned Residence | Land |
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| Building |
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| Establishing a mortgage |
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* Assessed Value of fixed assets:
It is a value used for the calculation of property tax, city planning tax, real estate acquisition tax, and for registration and license tax. The assessed value is listed on the property tax ledger in the local government office. Generally, it is 50-70% of the cost of construction for a building property and around 70% of the market price for land.
Necessary Conditions for Reducing Measures
- Completion of new construction or acquisition of a housing property by 31 March 2024.
- Floor area (registered) of 50 sqm or above
- A housing property for own residence
- A property registered within 1 year from completion date of new construction or acquisition date.
- Fireproof properties such as condominiums less than 25 years old, and other properties such as wooden-made properties less than 20 years old. If the property is older than each defined age, the property must satisfy certain criteria, such as being certified as meeting new earthquake resistance standards, or being insured with defect insurance on traded existing houses.
- For establishing a mortgage, a property which satisfies all above conditions.
Real Estate Acquisition Tax (Local Tax)
This tax is levied when acquiring land and/or a building by purchase or donation, or levied when a building is newly constructed or renovated.
• Case of New residential housing (including extension and renovation)
| Tax Rate & Reducing Measures | |
|---|---|
| Building | Assessed Value* x 3% Reducing Measures : (Assessed Value – Special Deduction of JPY12M) x 3% Necessary Conditions for Reducing Measures:
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| Land | Assessed Value x 50% x 3% The higher amount from the two below can be deducted from the above tax amount:
Necessary Conditions for Reducing Measures
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* Assessed Value: Assessed Value of fixed assets
• Case of Pre-owned Residence
| Tax Rate & Reducing Measures | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Building | Assessed Value* x 3% Reducing Measures : (Assessed Value – Special Deduction) x 3%
Necessary Conditions for Reducing Measures All of the following:
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| Land | Assessed Value x 3% Reducing Measures:(Assessed Value x 1/2 x 3%) – Deduction (Higher amount of the following A or B)
Necessary Conditions for Reducing Measures All of the following:
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* Assessed Value: Assessed Value of fixed assets
Taxes for retaining property
Fixed asset tax (Local Tax)
A person who owns a property as of the 1st of January, is responsible for paying the following taxes in the same year. During the year, when a property is transferred, the person purchasing should pay the remaining taxes for the year (on a pro-rate basis) to the seller when purchasing. The seller should pay the gross of such taxes to the government.
| Tax Rate & Reducing Measures | |
|---|---|
| Land | Assessed Value x 1.4% Reducing Measures : - For a land area not over 200 sqm, the Appraisal value is reduced to 1/6. - For a land area more than 200 sqm, the assessed value is reduced to 1/3. |
Necessary Conditions for Reducing Measures
A residential property should exist on the land as of the 1st of January of the taxable year.
| Tax Rate & Reducing Measures | |
|---|---|
| Building |
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Necessary Conditions for Reducing Measures
All of the following:
50% or more of gross floor area is used as a residential space, and gross area (floor area + portioned common area) should be more than 50 sqm and not over 280 sqm.
CITY [URBAN] PLANNING TAX (Local Tax):
The City Planning Tax is charged to persons owning any property within areas of urban districts or city planning districts designated by local government.
| Tax Rate & Reducing Measures | |
|---|---|
| Land | Assessed Value x 0.3% Reducing Measures : - For a land area not over 200 sqm, the assessed value is reduced to 1/3. - For a land area more than 200 sqm, the Appraisal value is reduced to 2/3. |
| Building | Assessed Value x 0.3% Reducing Measures : N/A |
Necessary Conditions for Reducing Measures
A residential property should exist on the land as of the 1st of January of the taxable year.
