Method of purchasing.

(1) Procedure of purchasing.

• Choose a property to purchase.
• Make an offer to the seller
• Agents start negotiations
• Agents explain the important matters
• Sign the SPA (Sales and Purchase Agreement)
• Pay the deposit
• Close the deal

(2) Requirements

• Certificate of Residence
• Certificate of Signature
• Identification

(3) Details

At the offer to the seller, the purchaser signs the letter of offer with the stated conditions including the purchasing price, contract date, closing date and deposit amount. The deposit amount is usually 5% to 10% of the purchasing price, and the contract is concluded within 3 days to 1 week after signing the letter of offer. Agents explain the important matters to the purchaser at the contract. The closing date is generally 1 or 2 months after the contract.

The purchaser may authorize someone they know in Japan, or a lawyer here, to sign the SPA by power of attorney. About one month later, the lawyer collects the title deed.

(4) Expenses

Tax
Acquisition Tax (The bill arrives 2 to 3 months later)
Registration Tax (Transfer of ownership from the seller to the purchaser)
Stamp Duty (The amount depends on the purchasing price)

Fees
Lawyer’s Fee (Fee for ownership transfer procedures)
Agent Commission (Purchasing price × 3% + 60,000 yen + tax)
Tax agent deputy registration fee (If cosigned to us, 100,000 yen + tax)

Sundry Expenses
Fire insurance (Including earthquake insurance)
Bank charges (Fees to transfer funds to the seller)

Settlement
At closing, settlement is made between seller and purchaser for maintenance fees, sinking funds, and property tax.

Total expenses are approximately 7% to 8% of the purchasing price when including the above costs. If the purchaser takes a mortgage, additional costs apply such as mortgage registration tax, stamp duty for the loan agreement, and bank handling charges.

(5) After purchasing a property.

Tax
Income tax
Property tax

Management
Property management fee: 5% + tax of rental income when tenanted.
Agent commission at the start of the lease
Tax return fee (Basic fee: 30,000 yen + tax)

Income tax varies depending on the taxable income after deducting all operating costs and depreciation.

All property owners must pay property tax every year. Property tax is based on the value assessed by the government and may change annually.

(6) Expenses at the sale

Fees
Lawyer’s fee (Transfer to the new owner)
Agent Commission (Selling price × 3% + 60,000 yen + tax)

Tax
Stamp Duty (The amount depends on the selling price)
Capital gains tax (If sold within 5 years, 30% of profit applies; if sold after 5 years, 15% of capital gains tax is levied)

If a mortgage is settled at the time of sale, additional lawyer fees apply.

(7) Online Transactions and Remote Closing

Even if the purchaser is not staying in Japan, the entire purchasing process can be completed remotely. Sales contracts and related documents can be executed through online systems and by using a Power of Attorney, allowing the transaction to be finalized without physical presence in Japan.