The Real Cost of Buying Property in Japan
When budgeting for property in Japan, most buyers focus on the listing price and forget about the substantial additional expenses that follow. The cost of buying property in Japan extends far beyond the purchase price—foreign buyers typically pay 12-18% extra in taxes, fees, and administrative costs, while domestic buyers face 8-12% in additional expenses.
📅 Last Updated: February 2026
This guide provides a complete breakdown of every fee you’ll encounter, from government taxes to condominium-specific charges. Whether you’re buying a Tokyo apartment or an akiya in the countryside, understanding these costs upfront will help you budget accurately and avoid the surprise bills that catch so many buyers off guard.
| Quick Cost Summary | Domestic Buyers | Foreign Buyers |
|---|---|---|
| Total Additional Costs | 8-12% | 12-18% |
| Government Taxes | 4-7% | 4-7% |
| Professional Fees | 3-4% | 3-4% |
| Foreign-Specific Costs | N/A | 4-7% |
💡 Pro Tip: The commonly cited “budget 7% extra” advice significantly underestimates actual costs, especially for foreign buyers. As Yasuharu Matsuno, CEO of Blackship Realty, warns: “Budget 7% extra for taxes and fees is misleading for foreign buyers, who usually face 12-18% in additional costs beyond the advertised price.”
Government Taxes When Buying Japanese Property
Understanding government taxes is essential when calculating the true cost of buying property in Japan. These mandatory charges add up quickly and apply regardless of your nationality.
Stamp Duty (印紙税 - Inshizei)
Stamp duty applies to both your purchase contract and mortgage agreement. The rates below are reduced rates valid until March 31, 2027:
| Property Price | Stamp Duty |
|---|---|
| ¥10-50 million | ¥10,000 |
| ¥50-100 million | ¥30,000 |
| ¥100-500 million | ¥60,000 |
| Over ¥500 million | ¥200,000 |
Registration and License Tax (登録免許税 - Touroku Menkyo Zei)
This tax is required to legally transfer ownership at the Legal Affairs Bureau:
| Transfer Type | Tax Rate |
|---|---|
| Land ownership transfer | 1.5% of assessed value |
| Building transfer (primary residence) | 0.3% of assessed value |
| Building transfer (investment) | 2.0% of assessed value |
| Mortgage registration | 0.4% of loan amount (0.1% for qualified primary residence) |
Important: These rates apply to the government’s assessed value (路線価), not your purchase price. The assessed value is typically 60-80% of market value, which works in your favor.
Real Estate Acquisition Tax (不動産取得税 - Fudousan Shutoku Zei)
This is the tax that catches most buyers off guard. The Real Estate Acquisition Tax bill arrives 6-18 months after your purchase, long after you’ve depleted your cash reserves on moving and furnishing.
| Property Type | Tax Rate |
|---|---|
| Land | 3% of assessed value |
| Residential building | 3% of assessed value |
| Commercial building | 4% of assessed value |
⚠️ Warning: As Tokyo Portfolio notes, “Real estate acquisition tax arrives 6-18 months after purchase when many buyers have forgotten about it. This tax bill appears in your mailbox long after closing.” Plan for this expense by setting aside funds immediately after purchase.
Some prefectures require you to file a declaration within a specific timeframe to receive reductions. Check with your local prefectural tax office immediately after purchase.
Consumption Tax (消費税 - Shouhizei)
Consumption tax of 10% applies only to:
- Buildings purchased from taxable entities (developers, real estate companies)
It does NOT apply to:
- Land (never taxed)
- Private sales between individuals
- Buildings from non-taxable sellers
For a ¥50 million new apartment from a developer (¥35 million building + ¥15 million land), expect ¥3.5 million in consumption tax on the building portion alone.
Professional Service Fees in Japan
Real Estate Agent Commission (仲介手数料 - Chuukai Tesuuryou)
Agent commission in Japan is legally capped. For properties over ¥4 million, the maximum formula is:
3% of purchase price + ¥60,000 + 10% consumption tax
| Purchase Price | Maximum Commission |
|---|---|
| ¥30,000,000 | ¥1,056,000 |
| ¥50,000,000 | ¥1,716,000 |
| ¥100,000,000 | ¥3,366,000 |
Commission is typically split into two payments:
- 50% at contract signing
- 50% at closing
Some agents offer discounts, especially for higher-priced properties. Don’t be afraid to negotiate.
Judicial Scrivener Fees (司法書士費用 - Shihou Shoshi Hiyou)
A judicial scrivener (shiho-shoshi) is legally required to handle property registration in Japan. Fees range from ¥50,000 to ¥330,000, with typical transactions costing ¥100,000-¥150,000.
💡 Pro Tip: “It’s recommended to request estimates from different shiho-shoshi offices, as fees vary considerably. Some judicial scriveners may charge inflated fees and pay rebates to real estate brokers.” Get at least three quotes before committing.
Home Inspection (ホームインスペクション)
Since April 2018, agents must explain home inspection options during transactions. While optional, inspections are highly recommended for older properties:
| Service | Cost |
|---|---|
| Standard inspection | ¥50,000-¥100,000 |
| English report surcharge | ¥30,000-¥50,000 |
Banking and Mortgage Costs in Japan
If financing your purchase, prepare for these additional expenses:
| Fee Type | Amount |
|---|---|
| Loan origination fee | ¥100,000-¥200,000 |
| Administrative fee | 1-2.2% of loan amount |
| Guarantee company fee | 2-3% of loan amount |
| Fire insurance (initial) | ¥200,000-¥500,000 |
| Earthquake insurance (annual) | ¥7,300-¥27,500 |
| Group life insurance (annual) | 0.2-0.3% of loan amount |
Fire insurance is typically required by mortgage lenders. Earthquake insurance, while technically optional, is highly recommended given Japan’s seismic activity.
For a ¥30 million mortgage, expect:
- Administrative fee: ¥300,000-¥660,000
- Guarantee fee: ¥600,000-¥900,000
- Initial insurance: ¥200,000-¥500,000
That’s potentially ¥1-2 million in mortgage-related fees alone, before you’ve paid a single monthly payment.
Condominium-Specific Costs
Buying a condominium (マンション - mansion) in Japan comes with unique one-time and ongoing costs that house buyers don’t face.
One-Time Repair Reserve Fund Payment
When purchasing a condominium, you’ll typically pay a one-time contribution to the building’s repair reserve fund. In Tokyo, this averages around ¥400,000 but varies by building age and size.
Monthly Management and Repair Fees
| Fee Type | Monthly Average (Greater Tokyo) |
|---|---|
| Management fee (管理費) | ¥12,831 |
| Repair reserve fund (修繕積立金) | ¥11,907 |
| Combined total | ¥24,738 |
Source: Patience Realty research, FY 2023
These fees are in addition to your mortgage payment and property taxes. For a ¥50 million Tokyo apartment:
- Monthly mortgage (35 years, 1%): ~¥141,000
- Monthly management/repair fees: ~¥25,000
- Total monthly housing cost: ~¥166,000
⚠️ Reddit Warning: Many first-time condominium buyers on Reddit report being surprised that there’s both a large one-time repair reserve fund payment AND ongoing monthly fees. Factor both into your budget from the start.
Hidden Costs for Foreign Buyers
Foreign buyers face additional expenses that domestic purchasers avoid entirely. This is why the 12-18% cost estimate for foreigners is significantly higher than the 8-12% for Japanese nationals.
Currency Conversion Costs
Banks typically charge a 2-4% markup on currency conversion for international wire transfers. On a ¥50 million property (~$330,000 USD), that’s potentially $6,600-$13,200 lost to exchange rate markups.
💡 Pro Tip: Use services like Wise (formerly TransferWise) or OFX instead of traditional banks. The savings on a single property transaction can exceed ¥500,000.
Translation and Legal Review
| Service | Cost Range |
|---|---|
| Contract translation | ¥150,000-¥500,000 |
| Legal review (English) | ¥200,000-¥500,000 |
While some buyers skip professional translation, having purchase contracts reviewed in your native language can prevent costly misunderstandings about property conditions, obligations, and special terms.
Higher Mortgage Rates for Non-PR Holders
Foreign buyers without Permanent Residency face:
- 0.5-1% higher interest rates than Japanese nationals
- Additional guarantee fees of 2-3% of loan amount
- Stricter loan-to-value requirements (often 70-80% maximum)
On a ¥30 million loan over 35 years, a 0.5% rate increase adds approximately ¥2.7 million to your total repayment. See our detailed guide on mortgage options without permanent residency for strategies to secure better terms.
Annual Property Tax Obligations
After purchase, you’ll pay these taxes every year:
Fixed Asset Tax (固定資産税 - Kotei Shisan Zei)
Rate: 1.4% of assessed property value
City Planning Tax (都市計画税 - Toshi Keikaku Zei)
Rate: 0.3% of assessed property value (applies only in urbanization promotion areas)
Combined annual rate: 1.7% of assessed value
Residential land reduction: For plots under 200 sqm, the assessed value is reduced to 1/6 for tax calculation purposes—a significant benefit for residential property owners.
| Assessed Value | Annual Property Tax |
|---|---|
| ¥10,000,000 | ¥170,000 |
| ¥30,000,000 | ¥510,000 |
| ¥50,000,000 | ¥850,000 |
Note: Actual tax bills vary based on reductions and local rates
Payment Timeline: When Each Cost is Due
Understanding when each payment is due helps you maintain adequate cash reserves throughout the buying process.
Stage 1: Contract Signing
| Cost | Amount |
|---|---|
| Down payment | 10% of purchase price |
| Stamp duty (contract) | ¥10,000-¥200,000 |
| First half of agent commission | ~1.65% + ¥33,000 |
Stage 2: Loan Application
| Cost | Amount |
|---|---|
| Loan application fee | ¥100,000-¥200,000 |
| Stamp duty (loan agreement) | ¥10,000-¥200,000 |
| Translation fees (foreigners) | ¥150,000-¥500,000 |
Stage 3: Closing Day
| Cost | Amount |
|---|---|
| Remaining purchase price | 90% of price (minus any loan) |
| Registration and license tax | 1.5-2% |
| Remaining agent commission | ~1.65% + ¥33,000 |
| Judicial scrivener fees | ¥50,000-¥330,000 |
| Mortgage registration tax | 0.4% of loan |
| Guarantee company fees | 2-3% of loan |
| Fire insurance | ¥200,000-¥500,000 |
| Prorated tax settlement | Varies |
⚠️ Often Missed: The prorated fixed asset tax and city planning tax settlement at closing catches buyers off guard. You reimburse the seller for property taxes they’ve already paid for the remainder of the year.
Stage 4: Post-Purchase (6-18 Months Later)
| Cost | Amount |
|---|---|
| Real Estate Acquisition Tax | 3-4% of assessed value |
| Initial repair fund (condos) | ~¥400,000 |
| Utility deposits | ¥50,000-¥100,000 |
Stage 5: Ongoing
| Cost | Frequency |
|---|---|
| Fixed Asset Tax | Annually |
| City Planning Tax | Annually |
| Management fees (condos) | Monthly |
| Repair reserve (condos) | Monthly |
| Insurance premiums | Annually |
Investment Property: Additional Costs to Consider
Buying property as an investment rather than a primary residence affects several cost calculations:
| Expense | Primary Residence | Investment Property |
|---|---|---|
| Building registration tax | 0.3% | 2.0% |
| Mortgage registration tax | 0.1% | 0.4% |
| Real Estate Acquisition Tax | Possible reductions | Full rate |
| Income tax on rental income | N/A | 5-45% marginal rate |
Investment properties don’t qualify for the special reduced rates available to owner-occupied homes. Factor this into your ROI calculations before purchasing.
For detailed information on rental income taxation, see our taxes and finance section.
How to Reduce Your Total Costs
While many costs are fixed, strategic buyers can reduce their overall expenses:
1. Shop for Professional Services
Judicial scrivener fees vary significantly. Get quotes from at least three offices before closing. Potential savings: ¥50,000-¥150,000.
2. Time Your Purchase
Reduced stamp duty and acquisition tax rates are available until March 31, 2027. Purchasing before this deadline ensures you benefit from lower rates.
3. Use Currency Transfer Services
Avoid bank wire transfer markups by using specialist currency services. Potential savings: 1-2% of transfer amount.
4. Negotiate Agent Commission
While agents can legally charge the maximum rate, many will negotiate, especially on higher-priced properties or if you’re a repeat buyer. Even 0.5% off can save ¥250,000 on a ¥50 million property.
5. Consider Cash Purchase
If you can avoid a mortgage entirely, you’ll save:
- Loan origination fees
- Guarantee company fees
- Higher interest rates (for non-PR foreigners)
- Mortgage registration tax
Total savings can exceed ¥1 million on typical transactions.
6. File Tax Reduction Applications Promptly
Some prefectures require applications within specific timeframes to receive acquisition tax reductions. Contact your prefectural tax office immediately after purchase to confirm requirements.
Frequently Asked Questions
How much extra should I budget when buying property in Japan?
Domestic buyers should budget 8-12% of the purchase price for additional costs. Foreign buyers should budget 12-18%, accounting for currency conversion fees, translation services, potentially higher mortgage rates, and additional guarantee requirements. On a ¥50 million property, that means preparing ¥6-9 million in additional funds.
What is Real Estate Acquisition Tax and when do I pay it?
Real Estate Acquisition Tax (不動産取得税) is a prefectural tax charged at 3% for residential property (land and buildings) and 4% for commercial buildings, based on the assessed value. The tax notice arrives 6-18 months after purchase, which surprises many buyers who have already spent their reserves on moving and furnishing. Set aside funds for this tax immediately after closing.
Do foreigners pay higher fees when buying Japanese property?
Yes, foreign buyers typically face higher total costs. While government taxes are the same regardless of nationality, foreigners often pay 2-4% more in currency conversion fees, ¥150,000-¥500,000 in translation costs, ¥200,000-¥500,000 in legal review fees, and potentially 0.5-1% higher mortgage interest rates. This is why the foreign buyer cost estimate (12-18%) is significantly higher than for domestic buyers (8-12%).
What are the monthly costs of owning a condominium in Japan?
Condominium owners in Greater Tokyo pay an average of ¥24,738 monthly for combined management fees (¥12,831) and repair reserve fund contributions (¥11,907). These fees are mandatory and increase over time as buildings age. Additionally, there’s typically a one-time repair reserve fund payment of around ¥400,000 when you purchase the unit.
Is consumption tax charged on all property purchases in Japan?
No. Consumption tax (10%) applies only to buildings purchased from taxable entities such as developers and real estate companies. It does NOT apply to land (ever), private sales between individuals, or purchases from non-taxable sellers. For new apartments from developers, the tax applies only to the building portion, not the land.
Related Guides
For complete information on buying property in Japan, explore these resources:
- Complete Guide to Buying Property in Japan as a Foreigner - Step-by-step buying process
- Japan Property Taxes and Finance - Detailed tax obligations
- Mortgage Without Permanent Residency - Financing options for foreign buyers
Official Sources
- Ministry of Land, Infrastructure, Transport and Tourism (MLIT) - Official tax rates for land acquisition
- National Tax Agency (NTA) - Stamp duty rates and consumption tax rules
- Ministry of Finance - Earthquake insurance system
- Japan Federation of Shiho-Shoshi Lawyers Association - Judicial scrivener information
Final Thoughts
The true cost of buying property in Japan extends well beyond the listing price. By understanding and planning for these hidden costs—from the surprise Real Estate Acquisition Tax bill months after purchase to the ongoing condominium management fees—you can budget accurately and avoid the financial stress that catches unprepared buyers.
Foreign buyers especially should plan for the higher end of the cost range (15-18%) to account for currency conversion, translation, and potentially higher financing costs. The investment in understanding these expenses upfront will save you from scrambling to cover unexpected bills during what should be an exciting time.
Ready to start your property search? Use our detailed guides to navigate each step of the process with confidence.
This guide was last updated in February 2026. Tax rates and reduction programs may change. For the latest information, please verify with official government sources and consult with a qualified tax professional before making purchase decisions.