There are no legal restrictions on foreigners owning real estate property in Japan.
Negotiations and private surveys may begin once the property has been chosen. It is important to hire the services of a real estate agent, who can also act as the buyer´s translator. An offer or a letter of intent, however, is not legally binding.
Before the deal, a Juyoujikou- Setsumeisho (similar to a Property Disclosure Statement or Seller´s Real Property Disclosure Statement) is drafted by the real estate agent. The purchase contract is drafted once a deal is settled. After this, a 10% deposit is expected from the buyer before the contract date.
During the closing, the title is transferred. Both parties should have certificates of their seal impressions. Stamps are obtained, and government fees and taxes are paid to register the title.
The last step is to pay the remaining balance.
The whole process of registering property has six procedures, which can be completed in around 12 days.
Sales of buildings are subject to consumption tax, which is levied at a flat rate of 5%. Sales of land are exempted from consumption tax.
The 5% consumption tax rate is composed of 4% national consumption tax and 1% local consumption tax.
The acquisition tax is levied at a flat rate of 4% for land. The tax is levied on the valuation of the property as determined by local government agencies, which is usually around 60% to 80% of the market value of the property.
The acquisition tax is levied at a flat rate of 4% for nonresidential buildings.
Registration tax is levied at a flat rate of 2% for land, and 2% for buildings. The tax is levied on the valuation of the property as determined by local government agencies, which is usually around 60% to 80% of the market value of the property.
Stamp duty is levied on the deed of contracts concerning the transfer of real estate properties.
Judicial Scrivener Fees
A judicial scrivener (Shiho shoshi) is a paralegal who settles and registers property transactions. Judicial scrivener fees are negotiable but are typically around 0.10% of the property value.