Once you have decided to purchase a specific unit of a Japan property, you are required to sign the Letter of Intent.
After the buyer has agreed with the reservation, 10% of the purchase price is payable by the buyer as deposit. Concurrently, the seller will provide more information of the overseas property for the buyer such as the lease and tenant's info.
Once the buyer has confirmed to purchase the reserved unit and already transferred the deposit to the buyer's account, the overseas property agent will prepare the contract and fix the completion date with the buyer.
After signing the Sales & Purchase Agreement, the remaining amount of the purchase price is payable upon completion. (The payment terms may vary from different developers.)
Three months before handover, the buyer must apply for mortgage. Normally, foreign investors are eligible for applying a 60% mortgage*. (Terms and conditions may vary depending on the buyer's background.)
In the morning of handover, a Japanese lawyer will transfer the buyer's name at the local land registry to grant the ownership to the buyer.
A: It depends on the completion date. Take completed properties as an example, it only takes around 2 months starting from signing the letter of intent to complete the process.
A： It is not necessary. Generally, Japanese will buy fire insurance for their properties which is equal to the home insurance in Hong Kong. A 5-year fire insurance and earthquake insurance cost around JPY
100,000 - 150,000.
Q: Are Japan properties freehold or leasehold?
A: Japan properties can be freehold or leasehold. The shortest leasehold is 30 years.
Q: What are L, D, K, S stand for?
A: L stands for Living Room, D stands for Dining Room, K stands for Kitchen, S stands for Storage room.
A: You may choose to receive the rental returns every four months or every year by TT transfer.
A: Foreign investors can apply for 60% mortgage. The interest rate can be as low as 2.8% per annum and loan period can be 35 years.
A: Buying or selling first hand Japan property can omit the agent's commission. Buying or selling second-hand Japan property is required to pay 3% of the purchase/selling price as agent's commission. If the client has assigned a rental management company to manage their properties, the management company will charge 5% of the rental return as management fee. The rental management company is responsible for collecting rent for the property owner, help pay the taxes for the owner and more. Besides, the property owner is required to pay for the property management fee and maintenance fee.
●Real Estate Acquisition Tax ：1% of the purchase price of the property
●Stamp Tax ：Depends on the purchase price of the property. Property with price under JPY 50,000,000 only required to pay JPY 15,000.
●City Planning Tax
Both of the above taxes will not exceed the amount of one-month rental return and they are seasonal taxes..
When you sell a Japan property, you need to pay capital gain tax. Properties owned no more than 5 years will be accounted for 30% capital gain tax. Properties owned more than 5 years will be accounted for 15% capital gain tax.
Check out Japan Property for Sale HERE