The Process of a Real Estate Purchase in Japan
We here provide a detailed explanation of the procedure and flow of buying Japanese real estate and acquiring proprietary rights to it.
Final Check of the Property - Closing - Transfer
Final check of the property
Final check of the present condition of the property
A final check of the condition of the property is conducted in the presence of both the Seller and Buyer. The property is checked to see if it coincides with what is stated in the condition report of the property and the list of facilities and equipment in the sales contract.
Items to be checked:
Fixtures and fittings, boundary markers, any leaks or termite damage, water supply and drainage, etc.
Closing and Transfer
Ownership Transfer Application
Normally, a Legal Scrivener processes the necessary registrations for ownership transfer to the Buyer.
They will check whether all the necessary documents are prepared for the application.
Then the Seller and the Buyer sign and seal the registration application forms.
Payment of the remaining sum
The Buyer pays the remaining sum of the property sales price to the Seller.
The paying and receiving of money is generally carried out by bank transfer, and at the time of delivery, a receipt is issued by the Seller to the Buyer.
If the Buyer is using a housing loan, it is quite common to process the payment at the financial institution that offered the mortgage.
Settlement of Fixed Asset Tax and other expenses
The Buyer shall be responsible for the fixed asset tax and management fee from the delivery date of the property.
Each amount to be paid is calculated on a pro-rate basis.
Receipt of Keys and documents for the property
The Buyer pays the remaining sum and other expenses, and then receives the keys and documents that come with the property. These documents include warranty documents, instruction manuals, and management rules of the facilities and equipment of the property.
Payment of the miscellaneous expenses
The Buyer shall pay Registry License Tax, Commission for the Legal Scrivener, and Agent Commission.
The following costs and items are required from the Buyer upon payment for the remaining sum:
- Remaining Sum of the sales price of the property
- Agent Commission
- Settlement money of Fixed Asset Tax, City Planning Tax, and Management fees
- Registration expenses (Registry License Tax, Commission for the Legal Scrivener)
- Personal identification document (Driver's license, Passport)
The following items are required by the Buyer in applying for a housing loan:
(The number of document copies required depends on the financial institution)
- “Jitsuin” - Officially registered seal, and seal registration document (only at the time of establishing Mortgage)
If you don't have a registered seal then a Signature Proof document issued by an embassy
Tax Payment required by the Buyer after acquiring the property
After buying a property, the Buyer must pay a real estate acquisition tax.
The tax office with jurisdiction of the property will send the Buyer all necessary documents related to the tax. You need to pay the tax by the deadline (within 3 to 6 months after buying a property).