Renting an Apartment or House in Nagoya

Embarking on your journey in Nagoya offers a fascinating glimpse into the blend of tradition and modernity that characterizes Japan’s housing market. Understanding the local real estate landscape is crucial to making informed decisions. This guide introduces you to the key terms and financial considerations you’ll encounter. Whether you’re looking for a cozy apartment or a spacious house here, I hope this helps you navigate the nuances of renting in Nagoya, ensuring you find a place that feels like home while respecting the unique aspects of Japanese rental agreements.

First, vocabulary:

1. Rent (Yachin 家賃): Rent is typically paid in advance monthly to the property owner. Late payment may incur a fee.

2. Reservation Fee (Tetsukekin 手付金): This fee is paid to secure an apartment after you’ve chosen one but before signing the lease contract. Once paid, the apartment cannot be offered to someone else, but changing your decision may result in forfeiture of the deposit. Generally, this fee equals about one month’s rent and is refunded upon contract signing.

3. Deposit (Shikikin 敷金): Security deposits are intended to cover potential damage to the apartment during your tenancy. After a move-out inspection, you’ll receive the deposit back, minus the costs of restoring the property to its original condition. Typically, this deposit ranges from 0 to 3 months’ rent.

4. Key Money (Reikin 礼金): Key money is a non-refundable payment to the landlord, varying between 0 to 6 months’ rent. It is a required gift for letting them rent to you. It’s traditional; I have no idea why, but they do it!

5. Real Estate Commission (Chukai Tesuryo 仲介手数料): The service fee represents compensation for the real estate agent’s role in facilitating the apartment rental and is non-refundable. In Japan, this fee is legally capped at one month’s rent.

6. Maintenance Fee (Kyoekihi 共益費): A monthly fee covers general upkeep and maintenance of the building, including grounds and structural maintenance.

Costs associated with Renting:

Full disclosure: the numbers are probably all messed up, but the ratios are about right. Say two months for this, one for that. Etc. NEVER listen to any number I give you without checking because I suck at numbers.

Renting an Apartment

Example: An apartment with a rent of JPY 230,000, a maintenance fee of JPY 15,000, and a parking fee of JPY 28,000 plus tax, starting from April 15th. 1.

Initial Costs

• Deposit: JPY 460,000 (2 months’ rent)
• Key Money: JPY 460,000 (non-refundable)
• Pro-rated Fees for April: Rent (JPY 118,709), Maintenance (JPY 7,741), Parking (JPY 15,607)
• Rent, Maintenance, and Parking for May: JPY 275,240
• Agency Fee: JPY 248,400 (1 month’s rent + tax)
• Guarantor Company Fee: JPY 192,668 (70% of the monthly total)

Total Initial Cost: JPY 1,778,365

Monthly Costs: From May onwards, the monthly cost is JPY 275,240, covering rent, maintenance, and parking.

Renting a House

Example: A house with a JPY 300,000 rent starting from April 15th.

Initial Costs

• Deposit: JPY 900,000 (3 months’ rent)
• Key Money: JPY 900,000 (non-refundable)
• Pro-rated Rent for April: JPY 116,129
• Agency Fee: JPY 324,000 (1 month’s rent + tax)
• Guarantor Company Fee: JPY 210,000 (70% of monthly rent)

Total Initial Cost: JPY 2,450,129

Monthly Costs: From May, the monthly cost is JPY 300,000.

Other Costs to Consider:

• Neighborhood Association Fee: Varies by area.
• Housing Insurance Fee: Separate and mandatory.
• Guarantor Company Renewal Fee: At least JPY 10,000 per year.

Key Takeaways

1. Budget Wisely: Initial costs can be significant.
2. Understand Contract Terms: Key money in Japan is usually non-refundable.
3. Seek Professional Help: The Japanese rental market can be complex. I recommend japanhomesearch.com.

Key Elements of Japanese Real Estate Rental Agreements

Understanding these standard clauses will help you navigate the rental process in Japan with greater confidence and ensure a smooth tenancy period.

• Cancellation Notice: Tenants must provide one to two months’ notice of cancellation, depending on the contract, while landlords must provide at least six months’ notice.
• Cancellation of Property: Upon termination notice, the property should be returned in the same condition, with landlords having the right to show the property to new potential tenants.
• Cancellation Penalty: Failing to give the appropriate notice can incur a one-month penalty, with a similar penalty for cancellations within the first year.
• Court of Law: Disputes arising from the contract are to be settled in the jurisdiction where the property is located.
• Damage: Tenants are responsible for any damage caused by themselves or their guests and must use only small nails for hanging pictures to prevent excessive wall damage.
• Disaster: Landlords are not responsible for damage to tenants’ property; tenants are advised to obtain their own insurance.
• Fees: Utilities are to be paid by the tenant.
• Issues not in the Contract: Any matters not covered must be resolved amicably between landlord and tenant. If it comes to it, the court will always be in Japan for disputes.
• Making Repairs: Tenants will receive prior notice for repairs unless it’s an emergency.
• Payment: Rent is due the month prior, with bank transfer charges being the tenant’s responsibility.
• Purpose of the Residence: The residence is intended for the listed tenants only, not for subletting or office use.
• Rent Increase: Landlords reserve the right to increase rent due to special circumstances, such as property tax increases.
• Repairs: While minor repairs fall to the tenant, major repairs are the landlord’s responsibility.
• Renewal: Contracts typically auto-renew unless a cancellation notice is submitted. Some contracts are annual, and these will usually involve a renewal fee. Check the fine print!
• Renter’s Insurance: Tenants may be required to obtain insurance to cover personal belongings, additional insurance for expensive items, and earthquake coverage.

As you embark on your journey to find the perfect rental home in Nagoya, armed with the knowledge of key terms and an understanding of the rental process, you’re well on your way to making an informed decision that suits your lifestyle and budget. Renting in Japan can be a smooth and rewarding experience with the proper preparation and awareness of your obligations and rights as a tenant. We wish you the best of luck in finding a home that’s not just a place to live but a home where cherished memories will unfold.

Benh LIEU SONG from Torcy, France, CC BY-SA 2.0, via Wikimedia Commons