Q4: How much costs do we need to pay to purchase a property?

Agency Fee: The standard broker is 3.3% of the transaction price plus 66,000Yen. Both the buyer and the seller pay this amount. Normally the buyer and seller have each their own broker. One broker is allowed to represent both parties, in which case he receives the broker fee twice. It is not common for brokers to give a discount on their fees.

Stamp Duty: On the sales contract each party is obliged to put a stamp. The amount is dependent on the transaction price and normally varies from 10,000 up to 80,000Yen. The stamps can be bought at any post office.

Judicial Scrivener Fee: In Japan the title transfer is arranged by a judicial scrivener. Included in his invoice will be the registration tax. The total costs can vary wildly depending on the type of property, the assessed value and if a mortgage needs to be registered as well. Also much like lawyers, some scrivener’s are much more expensive than others. As a rough estimate assume that the total cost for this item is about 60,000Yen plus 1.5% of the purchase price. And in case of a financed purchase add another 0.4% of the mortgage amount.

Acquisition Tax: Technically this is not a closing cost as it is due a few months after buying the property. Normally around around 0.5 to 1.0% of the purchase price, it can peak as high as 2%

Annual Possession Tax: The annual possession tax has to be paid by the owner of the property as of January 1. When you buy a property halfway during the year, it is customary to reimburse the seller for part of the year’s tax.

Monthly Maintenance: The monthly maintenance is normally paid at the beginning of the month. If you buy the property halfway during the month it is customary to reimburse the seller part of the maintenance fee. For transactions done close to the end of the month it is also normal to pay the next month’s maintenance to the seller as it can take a couple of days to notify the building management of the change in ownership.