The Japanese Housing Market: Is it Time to Buy?
The prices of newly built standalone homes and condominiums in Japan
have been rising steadily for the past few years,
but there is a growing concern that the market may
be reaching a turning point.
The prices of newly built standalone homes and condominiums
Investing in Japan’s Ageing Condominiums:
Opportunities and Insights for
Foreign Investors Amid Legal Changes
Are you a foreign investor interested
in Japan’s real estate market?
As a leading real estate agent for foreign investors, we’re here to provide you with the latest updates
and insights into the industry.
Today, we’re discussing the Japanese government’s proposed amendments
to the Condominium Ownership Act and what it could mean for you as a potential investor.
The Japanese government is considering amending the Condominium Ownership Act by the fiscal year 2024,
Rakumachi, a real estate website in Japan, conducted market research for the first quarter of 2023
and found that the prices of all types of investment properties in Japan have increased.
(Not property for living)
The average price of one-room apartments increased to 74.95 million yen,
the average price of one-building apartments rose to 277.9 million yen,
and the average price of condominiums rose to 18.81 million yen.
One-room apartments had a yield of 8.98%（gross yield), while one-building apartments had a yield of 7.52%(gross yield),
and condominiums had a yield of 6.87% (gross yield).
In fact, the most expensive item in our life is not ‘real estate’ but ‘our government’.
And the government is the tax.
So what kinds of taxes are imposed on real estate in Japan?
Real estate-related taxis include personal income tax, corporate tax, fixed-asset tax, city planning tax, real estate acquisition tax, registration tax, stamp duty, and consumption tax
Personal income tax related to real estate is the tax on individuals who gain rental income or capital gain through the sales of real estate.
Corporate tax is a tax on companies that have taxable income. Therefore, their real estate rental income and any profit from a real estate sale have an impact on their total taxable income level.
The corporate tax rate in Japan is currently about 37% (as of July 2019) so if you have a very profitable property, it is wise to hold the title under a corporate name rather than an individual name.