The following are costs that would be incurred in the transactional process of purchasing a property in Japan. Please note that not all taxes can be confirmed before purchase as many factors come into play.
The standard broker is 3.24% of the transaction price plus JPY 60,000. 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.
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 80,000 yen.
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 60,000 yen plus 1.5% of the purchase price. And in case of a financed purchase add another 0.4% of the mortgage amount.
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%. Commercial properties are taxed at a higher rate then residential ones.
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.
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.
Rent and Rental Deposit
In case the apartment is renter occupied the seller will transfer the deposit to the buyer. And like with the monthly maintenance fee, the seller will pay the part of the month’s rent starting at the purchase date.