In spite of the complex legalities and difficult market, the property purchasing process in Japan is relatively straightforward. This article outlines its basic progression.
To officially open negotiations on a property you will need to submit a purchasing application to the listed seller. This document will outline your terms and serve as the official basis for the rest of the transaction.
Next, you will review the specific details of the purchase with a licensed agent (usually your real estate agent). If you are not represented by a real estate agent, you will meet with the seller’s real estate agent instead.
Once you are clear on the details, a contract signing will be scheduled. At this point, you will have to pay a 10% deposit to the seller and the appropriate commission fee to your real estate agent. With the fees and the real estate agent paid, you then stamp the contract with your inkan (official ink seal that serves as a signature) to finalize the transaction.
If you need to apply for a mortgage, you will do so after signing the contract. Keep in mind that mortgages must be approved before the contract´s closing date. Due to the extreme difficulty in obtaining a Japanese mortgage, in many cases your commission and deposit are refundable. Make sure that this is stated in the contract if you are not completely sure that you will receive a mortgage.
With mortgage and contract in hand, you should then approach a shiho shoshi (licensed legal specialist) to register your property and pay the required registration fees. If you were represented by a property lawyer during the transaction, he will probably handle this for you. Once the property is registered, you will receive the keys to the property along with the deed.
In addition to the deposit and commission, you will have to pay stamp duty on all of your property transactions. The amount can vary wildly, anywhere from a few hundred to several hundred thousand yen depending on the property and the transaction. The more complicated the transaction and the more expensive the property, the higher the stamp duty will be.
If a shiho shoshi prepares your deed you will need to pay him a fee of a hundred thousand yen or more. Finally, you will need to pay for insurance on the property and a Real Property Acquisition Tax. The latter will be sent to you by the government.
More information can be found at Real-estate Tokyo.com .