Real Estate Terms

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Key Money (Reikin)
It is a payment required for a new tenant to pay the owner. Unlike bond money, the tenant cannot claim back this money at the end of the contract. In many cases, upon signing the contract, the new tenant even agrees to pay "Key" money in addition to the traditional two to three months' security deposit. This is a traditional gesture of thanks to the property owner for allowing rental of their home. Some owners do not charge any key money to attract potential customers due to high initial costs putting a lot of people off. However, these property owners compensate the loss of key money by charging a slightly higher rent to balance out the difference.
This applies to both Japanese and non-Japanese. If you stay longer, sometimes paying key money becomes cheaper compared to higher rent with no key money. Question index
Security Deposit (Shikikin)
The law does not regulate the amount of security deposit requested from property owners. Two to three months deposit is normal, depending on the property. Typically, expensive large homes charge deposit more than smaller homes. A pet deposit may be added if you are to planning to have dogs or cats. This additional deposit will not be returned if you chose to have pets.Question index
Rent Advance
A Rent advance of one full month is due upon moving in. In addition to this one full month, you will need to pay the part month (pro rata) that you move in on.
If you move in on the 15th, you will need to pay for the remaining days of that month as well as the following month in full. Your next payment will NOT be due until the end of the following month at which time will return you to be in synch for future payments.Question index
Agent Fee (Chukai Tesuryou)
The industry standard commission fee for you to hire your agent is equivalent to one month's rent plus 8% consumption tax. Generally, they are fees paid to the agents for service of introducing suitable apartments/homes, translating & processing of paperwork as well as applying for the apartments utility services. Question index
Fire Insurance
This is a compulsory fee when moving into an apartment. It provides protection against events beyond your control that happen in your apartment, however, earthquake damage is excluded and you will need a separate policy if you want protection for earthquakes. Different apartment buildings offer different coverage.Question index
Renewal Fee (Koushin ryou)
The standard rental contract lasts for a period of two years. Before the end of your two year contract you will need to determine if you are going to renew or not. There is a fee paid to the owner/landlord (in some cases) to renew a contract. This is usually the equivalent of one month rent. If you do not want to renew, you can arrange a cancellation notice and is usually required one or two months prior to the end of the contract.Question index
Restoration Fee (Genjyou Kaifukuhi)
In Japan, when you move out of the apartment, you are required to pay the cleaning fee. This is required no matter how clean you leave the apartment. The cleaning fee depends on the size and is based on a charge of roughly 1,000 yen – 1,250 Yen per square meter. ( Tokyo 2011 ). If you are in Tokyo, normal wear and tear is beared by the property owner, but you will be liable for any damage. It is regulated by “Tokyo Rules” and that states how the owner can only charge on applicable and reasonable damage.
The following are examples of what damage you will be responsible to pay for:
+ Pin holes and hooks in the wall for pictures / drawings
+ Painting a wall in a different colour
+ Scratches on the floor with heavy furniture
+ Leaving the damage (even natural one) and as a result the damage gets bigger.

Even if the above are by accident, you will be charged for repair upon move-out. Question index
To rent an apartment in Japan you will need a Guarantor. A Guarantor is a person that will assume the responsibility to make payment if the Lessee defaults on payment. This protects the landlord from people leaving the apartment and not paying their rent.Question index
Who can be a Guarantor?
A Guarantor is either a financially secure Japanese national residing in Japan or can also be a company that is registered in Japan. It is common for Japanese nationals to use a relative as Guarantor. If you are an individual that does not have anyone available to be Guarantor or working for a company that will not be Guarantor, you do have another option.Question index
What is a Guarantor company?
Guarantor companies are becoming increasingly more popular as the industry recognises the difficulty of finding a Guarantor for foreigners relocating to Japan. These companies usually charge a one-off fee of 50% of rent and a renewal fee of 10,000 Yen per year. Not all properties allow Guarantor companies so your range of available apartments will be limited.Question index