Modern Architecture

L'il SECRETS to help you with real estate in JAPAN

Real Estate is a big field involving buying, renting, selling and much more, especially in JAPAN.  Here are some hints for you when you as you get into this interesting new world.

Japanese House

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SCARY things about owing real estate properties in JAPAN

1. DEPRECIATION

        Basically houses in Japan depreciate, and while land may keep its value, the house on it will be worth less and less as time goes on, going to zero or even minus numbers (to account for the costs of demolishing the building) after a number of decades.

2. ACTS OF GOD

Tsunamis, landslides, volcanoes, typhoons and more

          Japan has more than its fair share of natural disasters, many of which can affect (or destroy) your property. Insurance may or may not cover you — definitely worth looking very carefully at the fine print.

3. BUILDING new BUILDINGS

          You find the place of your dreams, build the perfect house and settle in to enjoy the wonderful view. Then someone buys the land next door and builds a larger house a couple of feet from your bay windows.

There are various laws that pertain when light is restricted etc, but there are also lots of loopholes for big agencies to navigate through.  

4. PESTS

          Termites (shiro ari in Japanese) can be a nightmare for homeowners.   Once they move in (burrowing in invisibly from underneath the house) they quickly eat the timber and insulation in your walls and require expensive repairs. 

Cockroaches are less serious but potentially more unpleasant. They are everywhere to the point where you can buy roach hotels (Goki buri Hoi Hoi)in your neighborhood convenience store.  Japanese people are so used to them that they've nicknames them "Mr. G."

5.  NEIGHBORS

          Neighbors and community are a big part of Japanese life.  There are many festivals, activities and sporting competitions that you may be asked to take part in.  Neighbors very often feel compelled to just walk in your house when ever they want - don't worry they steal anything but lock your door or at least stay dressed.  

As the population of Japan is 97.9% Japanese, a lot of Japanese people are still not used to expats living in Japan.  This can lead to various behaviors ranging from them awkwardly trying to communicate with you on a daily basis to them yelling at you for putting your garbage out too late, or even worse, too early.

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TAXES

1. CAPITAL GAINS TAX

       The capital gains tax is imposed on gains from sales of real estate such as lands and buildings. In the case of an individual, real estate income is calculated apart from other income calculations. If the holding period of a property is five years or less, income tax of 30% and resident tax of 9% are imposed as a capital gains tax on the transfer of real estate. If the holding period of a property is more than five years, income tax of 15% and resident tax of 5% are imposed as a capital gains tax on the transfer of real estate. In the case of a corporation, the gain is included in taxable revenue to calculate the total amount of taxable income to determine the amount of corporate tax, for which an effective corporate tax rate of approximately 30% is applied.

 

2. PROPERTY & CITY PLANNING TAX

Property tax and city planning tax, imposed on owners of fixed assets such as land and buildings on January 1 of each year, are paid to the local municipalities where the assets are located. Amounts are calculated based on the value of the assets. The standard rate of property tax is 1.4% and the rate of city planning tax is 0.3%.

3. REAL ESTATE ACQUISITION TAX

A real estate acquisition tax is imposed only once when real estate such as land and buildings is acquired. Acquisition of real estate is defined as acquisition of ownership of real estate through transactions such as buying and selling, donations, exchanges, and construction (for new buildings, extensions, or alterations). If real estate is acquired by inheritance, this tax need not be paid. A standard rate of 4% (although special provisions present 3% for land and housing [up to March 31, 2018] and 4% for buildings other than housing) is applied against the real estate value.

Tax return

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Renting a house or apartment

COMING SOON!!!

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Selling your real estate 

COMING SOON!!!