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Dear Rica, Are there restrictions on foreigners owning real estate in Japan?

Japanese property investment

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Dear Rica,

I am a 50-something foreign professional and have lived in Japan for the past 20 years. I like it here and would like to retire here. I have a small nest egg that I would to invest, possibly in real estate investment. I have been warned by friends that there may be restrictions on foreigners’ owning or investing in real estate in Japan. Is this true?

Todd S.


Hi Todd,

Now is the perfect time to join the wave of foreigners (mostly from China and other places in Asia) who are investing in both residential and commercial real estate in Japan. Long-term investments can be a good way to hedge other short-term investments.

A short response to your question is a resounding “No”. There are no legal restrictions on foreigners’ real estate investments in Japan. However, some foreign investors may experience a sense of hesitancy from certain property owners or property managers who do not have extensive experience with foreigner nationals or who feel some kind of cultural or language gap. However, working with an English-speaking real estate agent is a great way to allay such concerns and facilitate smooth communication.

On the other hand, foreigner investors may experience difficulties obtaining mortgages from Japanese banks, unless they have a legal permanent resident status. Other requirements, such as income and guarantors, may vary from bank to bank, so please check well in advance.

Finally, if a foreign investor plans to reside outside Japan, they will need to make sure that rental income can be remitted to their foreign bank account since banks may refuse to open accounts for non-resident foreigners.

Good luck with the investment.

Rica

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