5 Precautions When Purchasing Real Estate in Japan

Japan's real estate market offers a mix of modern apartments, traditional houses, and commercial spaces, attracting both local and international buyers. However, purchasing property in Japan comes with unique challenges that require careful consideration. Here are five critical precautions to take when buying real estate in Japan:

1. Boundaries: Clear but Often Overlooked

One of the significant issues in Japanese real estate is the clarity of property boundaries. Boundary rivets, which mark the corners of a property, can often be demolished or become unclear over time. This can lead to disputes with neighbors and difficulties in determining the exact property lines. Before purchasing, it's ideal to hire a professional surveyor to verify the boundaries. Ensure that the property's boundaries are clearly marked and documented to avoid potential legal issues.

2. Completion Certificate: A Key Document

Many older properties in Japan lack a completion certificate, a document that certifies that the building complies with local building codes and regulations at the time of construction. Without this certificate, obtaining financing from banks can be challenging. This not only limits your ability to purchase the property but also affects its resale value since future buyers may face the same financing issues. When considering properties, check for the presence of a completion certificate or be prepared for potential hurdles such as illegal construction, securing finance, and limited resale price.

3. Hazardous Areas: Natural Disaster Risks

Japan is prone to natural disasters, including earthquakes, landslides, and floods, particularly in hilly areas and near rivers. When purchasing property, it's essential to research the area's susceptibility to natural hazards. Consult local hazard maps, understand potential disasters and consider insurance. Investing in properties with proper safety measures can protect your investment and ensure the safety of occupants.

4. Life Line: Additional Urban Costs

In rural areas of Japan, properties often lack access to public gas pipes and sewage systems. This can result in higher running costs, as you might need to install and maintain private systems for gas and sewage. Before purchasing, evaluate the infrastructure in place and factor in the potential costs of upgrading or maintaining essential utilities.

5. Environment: The Importance of Field Work

Sometimes, the lack of thorough fieldwork can lead to purchasing properties with unforeseen environmental problems. This could include issues such as noise pollution, unpleasant odors and proximity.

Purchasing real estate in Japan requires careful attention to these unique aspects to ensure a sound investment. It is important to work with a fully bilingual and transparent agent, visit the property in person, and walk around the neighborhood to acquire all necessary information to make informed decisions that safeguard your investment and future.