How to purchase Real
Estate Property in Japan~ procedure, tax and regulations ~FORET HOLDINGS, INC
Edited in Dec. 15, 2018

Table of Contents
1. Can foreigners purchase real estate property
in Japan?
2. How much will be the Cost/Expense; whatkinds of taxes?
3. How can foreigners do funding/financing?
4. What kinds of documentations are required
for foreigners to purchase it?
5. Procedures for purchasing
6. Points to be noted2

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1. Can foreigners purchase realestate property in Japan?
- Yes, basically foreigners can purchase real estate property inJapan as Japanese do.
- Whatever they have the right of permanent residency or not, orno matter what kinds of VISAs they have, they can inquire realestate property in Japan- Also, they have to pay taxes relating to real estate property asJapanese do.
- However, there are some differences or something impossible
for foreigners’ owners comparing with Japanese; to be notedlater
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2. How much will be the Cost/Expense;
what kinds of taxes or other expenses- Besides property price itself, there are some expenses; listed below.
- The total expenses will be approximately 8% of property price.
- List of Expenses;- Documentary Stamp tax (Sales Agreement)- Real Estate acquisition tax- Registration and License tax- Commission for Brokerage Company- Insurance; Fire Insurance/ Earthquake Insurance, etc.
- Settlement Money for Fixed Assets Tax※
- Settlement Money for Administrative Fee※Settlement Money for Fixed Assets Tax: Fixed Assets Tax shall be paid by Seller of Property, and it is imposed
to Seller on the date of Jan. 1st of each year. Therefore, in case that Buyer purchases Property on Jul. 1st, 2019,from Seller, a half amount of fixed assets tax of Property shall be paid by Buyer. However, because the total
amount of fixed assets tax has already been imposed to Seller on Jan. 1st, 2019, Buyer shall pay applicable money
to Seller as Settlement Money for Fixed Assets Tax.
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3. How can foreigners do funding/financing? ①- There are three options; 1). Overseas Remittance, 2).
Mortgage, and 3). Check- 1). Overseas RemittanceIf foreigners do not have bank account(s) in Japan,
they need to pay via overseas remittance throughfinancial/ banking institutions in overseas. In orderfor smooth procedure of purchasing, foreigners
are required to make remittance into real estate
property company’s depository/ custodial accountin advance of settlement.
※Points to be noted
For risk management, foreigners must receive the followings:- Before Remittance: Company-sealed Remittance Statement Documents;- After Remittance: Foreign Exchange Documents via the institutions in overseas.
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3. How can foreigners do funding/ financing? ②- 2). Mortgage
Financing/ Banking institutions in Japan allow foreigners
to loan money via its mortgage Basically ONLY IF they
have right of permanent residency in Japan because theinstitutions want to check whether they may stay in Japan
during payment period or not.
※Two exceptions are the followings:
A). When the financing/ banking institutions in overseas have theirbranches in Japan, it is possible for foreign investors to loan moneyfrom there;
B). Some Japanese institutions allow them to loan.
(e.g. please refer the URL below and see “Home mortgage”)
https://www.tokyostarbank.co.jp/service/foreign_customers/en/index.html
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3. How can foreigners do funding/ financing? ③- 3). Check
Cashier’s Check is only available for purchasing real estate
property. However, encashment of check mightsometimes take long time and it means you cannot
complete payment even though you want to complete it
immediately. Therefore, in order to avoid any troubles
with Seller, it is strongly advised that you need to discusswith Seller in advance when you want to pay via Cashier’sCheck.

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4. What kinds of documentations are required
for foreigners to purchase it? ①- 1). For foreigners (Individual) living OUTSIDE of Japan:
A). Documents substitute for Certificate of Residence of Japan
B). Passport
C). Documents substitute for Certificate of Seal Impression of JapanD). Private Seal
details are the followings:
A). Documents substitute for Certificate of Residence of Japan;(choosing one document from the followings)- Resident Registered Certificate (issued in foreigners’ nation)- Notary-certified Affidavit (issued in foreigners’ nation)- Affidavit certified by Consular Section of the Embassyof the foreigners’ nation in Japan※ Affidavit certified by the Embassy is the most favorable:
confirmation to the Embassy to be requiredB). Passport: strongly advised to take a photo copy;
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4. What kinds of documentations are required
for foreigners to purchase it? ②C). Documents substitute for Certificate of Seal Impression of Japan;(choosing one document from the followings)- Foreigners receiving Affidavit (issued and sent by Judicial Scrivener
in Japan) then signing in front of and certified by Notary Public offoreigners’ nation (If foreigners not in Japan)- Foreigners signing on the Registration Letter of Attorney (issued by
Judicial Scrivener in Japan) then certified by Consular Section of theEmbassy of the foreigners’ nation in Japan (If foreigners in Japan)※ Signing on the Registration Letter of Attorney and certified by the Embassy is
the most favorable: confirmation to the Embassy to be required
D). Private Seal: recommended to make it in Japan.
Conclusion: Purchasing Real Estate Property can be done without coming toJapan. However, because some governmental documents are better issued inJapan, we recommend for foreigners to come to Japan in order to issue and12/28/2018
being certified required documents.9

4. What kinds of documentations are required
for foreigners to purchase it? ③- 1). For foreigners (Corporation) living OUTSIDE of Japan:
A). Documents substitute for Certificate of Corporate Registration in Japan
B). Passport of Representative
C). Documents substitute for Certificate of Seal Impression of JapanD). Private Seal of Corporation
details are the followings:
A). Documents substitute for Certificate of Corporate Registration in Japan;(choosing one document from the followings)- Corporation Registration Certificate (issued by in-charge of theMinistry/Department of foreigners’ nation)- Notary/in-charge person from the Ministry/Department-certified
Affidavit that declares foreigners truly the representative ofCorporation and Corporation truly registered in the nation (issued inforeigners’ nation)
B). Passport of Representative: strongly advised to take a photo copy;

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4. What kinds of documentations are required
for foreigners to purchase it? ④C). Documents substitute for Certificate of Seal Impression of Japan;(choosing one document from the followings)- Corporate’s Representative receiving Affidavit (issued and sent by
Judicial Scrivener in Japan) then signing in front of and certified by
Notary Public of foreigners’ nation (If Rep. not in Japan)- Corporate’s Representative signing on the Registration Letter of Attorney(issued by Judicial Scrivener in Japan) then certified by Consular Sectionof the Embassy of the foreigners’ nation in Japan (If Rep. in Japan)※ Signing on the Registration Letter of Attorney and certified by the Embassy is themost favorable: confirmation to the Embassy to be required
D). Private Seal: recommended to make it in Japan.
Conclusion: Purchasing Real Estate Property can be done without coming toJapan. However, because some governmental documents are better issued inJapan, we recommend for foreigners to come to Japan in order to issue andbeing certified required documents.
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5. Procedures for Purchasing ①
General Procedures are the followings:1). Inspection of Real Estate Property2). If willing to purchase, submitting Certificate of Offer toPurchase to Seller or Broker
3). Confirming of payment method4). Explanation of Matters of Weight from Broker
5). Agreement on Contract of Sales
6). Billing/Payment
7). Settlement/Registration
8). Reporting to the Minister of Finance via Central Bank of Japandetails continuing to next pages:
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125. Procedures for Purchasing ②1). Inspection of Real Estate Property- Highly recommended on-site inspection
2). Submitting Certificate of Offer to Purchase to Seller/Broker- Certificate of Offer to Purchase means showing will ofpurchasing to the Seller or Broker- Certificate of Offer to Purchase includes:
Seller’s/Buyer’s Asking Price, Earnest Money Deposit,
Price of Mortgage (if loan via mortgage),
Date of Contract, Date of Move-in, Other Requests

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5. Procedures for Purchasing ③3). Confirming of Payment Method- For further Info. pls. refer to the page 5 thru 7“How can foreigners do funding/financing?”
4). Explanation of Matters of Weight from Broker- Matters of Weight includes:
Abstract of Property/Rights/Payment Method/
Rules for Termination of Contract5). Agreement on Contract of Sale
- When agreement, you need to bring: 1). Document substitute for
Certificate of Seal Impression of Japan (Pls. refer to page 9 or 11);2). Private Seal.
- Also, when agreement, required to pay Documentary Tax andEarnest Money Deposit (Approx. 10% ~ 20% of Purchasing Price)1412/28/2018

5. Procedures for Purchasing ④6). Billing/Payment- Paying remaining amount after deduction of Earnest Money Deposit
7). Settlement/Registration- A Judicial Scrivener, one be half of foreigners (new owners), willregister the Real Estate Property. When registration, required topass the followings to a Judicial Scrivener:1). A document substitute for Certificate of Residence of Japan
2). A document substitute for Certificate of Seal Impression of Japan
3). Private Seal
(Pls. refer to page 8 thru 11 for the details)
8). Reporting to the Minister of Finance via Central Bank of Japan- Report by Judicial Scrivener or Brokerage Company
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6. Points to be Noted
1). Receiving Certificate of Title- About a week later, Certificate of Title will be issued.
Strongly recommended to discuss whether the title will besent to foreigners or stored in Property Managementcompany prior to receiving it.

2). Administrator of Tax Payment- Required to set an administrator of Tax Payment in orderto pay Real Estate Acquisition Tax, Fixed Assets Tax, etc.
Administrator shall be a licensed tax accountant of Japanso strongly recommended to ask brokerage company or property
management company to introduce an administrator.
3). Tax Return- in case of investment, required to fill tax return. Therefore, as same as2)., strongly recommended to ask it to a licensed tax accountant.
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