An updated version of the

Apartment Hunting in Japan:

Or Remember Your Wallet

December 8, 2022

Published online at

https://medium.com/japonica-publication/apartment-hunting-in-japan-1033d56b6501

Searching for an apartment
Looking for an apartment was relatively easy in Japan. I highlight the word: looking. This was our process several years ago when we rented an apartment in Hyogo, Japan.
We made an appointment for a visit to a realtor and showed up that day. Outside there was a board listing the guests for the day, and ジョンストン、my name in katakana, was there.
The moment we sat down, a lady pointed at the DRINK MENU. A reminder — we are in a realtor’s office, not a coffee shop — and I got some hot coffee and grabbed some of the candies in the jar next to me. Extra energy in the apartment hunt.
After showing us four places on the internet, we turned around and a van was waiting for us with a worker standing by the door. We got in the van, and the employee did his obligatory 90-degree bow, which he held as we drove away.
Actually, looking at the apartments was similar to the US. Our agent highlighted the good points and agreed with everything we said. Something like this:
Scott: It is a little dark, isn’t it?
Realtor: Yes, but it is very convenient to the station.
Scott: The traffic noise gets in easily.
Realtor: Yes, but it decreases at night when you sleep.
Scott: The veranda is nice and wide. Great place to put a small chair and table.
Realtor: Yes, you can have a beer after work and relax.
When we went to an apartment that looked like a cyclone just hit it:
Yoko: You mean people leave apartments like this? Don’t they have to clean it?
Realtor: It is a bit dirty, but it will look nice when renovated.
Scott, thinking to himself, “a bit dirty” probably does not fit having holes in the wall where the air conditioners were dragged out, mold on the wall, and piles of junk.
Deciding on an apartmentAnd after we decided on an apartment.
Realtor: I thought you would take that one. Was the deciding factor the park along the river?
Scott: And very close to the station. Only three minutes. The other was really big and nice but about a 20-minute walk.
Realtor: Yes, the park is really nice and in spring, it is beautiful when the cherry blossoms bloom.
Scott: Huh?
I felt a gap or shall we say a wall in the flow of that conversation. Did he? Or was he just following the Guidebook of the realtor company, named something like “How to rent any apartment to anyone.”
Learning about costsSo, now we just pay the next month’s rent and a month’s deposit and move in soon, right? Wrong. We are in Japan, in the Kansai area around Osaka. There are more shocks ahead, for me the supposedly Japan-wizened foreigner, and for my hopelessly lost Japanese wife from Kanto, the area around Tokyo.
Ok, the rent is 130,000 yen a month and kyouekihi (共益費) or monthly service fee is 8000 yen, for a total monthly cost of 138,000 yen a month, which is about $1200.
So how much is due: 808,000 yen or about $7026, not 138,000 yen. I think I notice a substantial difference, like, WHAT did I miss?
Here is the breakdown.
First is key money or thank you money which is reikin (礼金) or sometimes called shakin (謝金). It comes to 390,000 yen which is three times the monthly rent. This key money or thank you money can differ between regions of Japan, and between realtors. How do you know how much it is? Ask!
Then there is the one-month security deposit, known as hoshoukin (保証金).
I guess the key money and security deposit will keep the landlord secure. My wife asks this logical question, “Since part of the money is a security deposit, we get it back later, right?
The response is, “Well the shikibiki (敷引), or non-refundable part of the deposit will not be returned.”
Scott: Well, we are renting the apartment for 130,000 yen a month, isn’t that thank you enough?
Realtor: Ha-ha. That is funny. You are a funny guy. You give 390,000 yen to the landlord. It is part of the process here in Japan.
Scott: That is a lot of thank you money, as I only get a teacher’s salary and no thank you money for actually teaching students. The landlord is not actually doing anything.
Relator: But they have to renovate the apartment by changing the tatami, cleaning up after the last renters, maybe changing the bathtub and sink, fixing the walls in the three bedrooms, kitchen, and living room, etc. It is a lot.
Scott: Uhm… That sounds like the deposit part of the fortune I would give you. What about these other costs?
Realtor: First month’s rent is 130,000 yen. Fire insurance is 20,000 yen. The Realtor’s fee is 130,000 yen. This is one month’s rent. And taxes, of course.
Necessary documentsScott: So, that is all we need?
Realtor: Well, a few documents, of course.
Juminhyou (住民票), or residence permit. This is from the city to prove you are a resident here.
Of course, someone has to guarantee with his signed registered hanko (判子) on the contract.
Income withholding slip for last year.
Proof of identity.
Picture of the family members.
GuarantorScott: Why do we need someone to guarantee?
Realtor: If you burn down the place or leave without paying, the landowner needs a way of getting his money back.
Scott: Well, what about the 390,000 yen I pay for the thank you money? Isn’t that enough of a guarantee? Plus, I see I am paying fire insurance.
Realtor: Ha-ha. You sure like jokes. It is a custom here in Japan and we can’t break customs, can we?
Later, I asked a Japanese friend about the guarantor. He said that anyone you ask to be a guarantor takes on a great responsibility. He added, if we did destroy the apartment and leave, he would be responsible to pay for the damages above the insurance payment. In other words, not just anyone will guarantee you. This surprised me as this friend really viewed the guarantor as a position taking on a great responsibility.
If I were Japanese, I would probably feel a great debt to this person being my guarantor. Being American, this is one aspect of Japanese culture I have not adopted: deep feelings of obligation.
We asked Yoko’s brother, who is a public school teacher. As it turns out, he had to send a certified official paper saying that his hanko is certified. And of course, he had to put his stamp on my contract.
He called and said the realtor had asked him such questions as, how much does Scott make? How long has Scott worked as a teacher? And where do you work?
Oh, by the way, I am his guarantor for the apartment he rents for his and Yoko’s mom!
It seems that you can get around the guarantor two ways. First, your company will often serve as the guarantor. Now in Japan, there are new companies that act as guarantors. You just pay them to guarantee you. A nice niche in the apartment renting area.
This process made me think that the concept of privacy which Japan seems to promote superficially, does not exist in reality. I had to give a copy of my yearly income statement, the US equivalent of W-2, a photograph of my family, a copy of my foreign resident card, etc. They know everything about me. Just for a rental apartment.
Important facts explanationApartment rented. Done. Not so fast.
This happened on the 29th of June and the day of getting the key was the 10th of July.
On the 6th of July, we returned to the realtor’s office to have a jūyōjikōsetsumei (重要事項説明), or Important Facts Explanation session about the contract and the signing. We arrived and, of course, were handed the menu to choose from or tea or coffee.
Then a new face appeared. He was the person to explain the Important Facts. As it turns out, you need a license to explain the Important Facts, not unusual as you need a license to do practically anything in Japan. Yoko looked at his card and job title which was in Japanese. His name and title covered the whole width of his meishi (名刺). Yoko beat me to asking, “What does it mean in English?”
Of course, the answer was, “Haha! I don’t know?”
I asked if this license was required all over Japan, as I had never seen it while apartment hunting in Kanto. He assured me it was necessary nationwide.
The important explanation began. He had his copy of the documents and we had ours. And it was full of complicated kanji to make sure we did not understand. Two key points stood out for me.
1. The building we were going to stay in was bought with a bank loan. If the owner does not pay on the loan or sells the building, we have six months to get out. Also, a new owner could ask for the 390,000-yen guarantee money. When I heard this, I raised my hand to make sure my hearing was correct. I thought, “I need to buy a rental building and rent it out. What a deal for a landowner, although not so good for the renters.”
2. There was a section about the yakuza. I guess if I am a yakuza, they most likely will not let me rent it. I thought, if I am a yakuza, I’d better not tell them, though my tattoos may give me away. Yoko then reminded me that one of the biggest yakuza families had their headquarters in this area. Great neighbors. I hope they like Americans.
Signing the contractThen we signed the contract, probably in katakana and English. Yoko even took out the ジョンストン (Johnston) hanko and put it to work.
Once again as we finished this, we turned around and the van was waiting for us to take us to the apartment where we planned to measure areas for household goods we had to purchase. Of course, next to the door was our obligatory doorman pointing to the door, in case we could not see it, and he gave us a 90-degree bow as we took off.
Our apartment, well almost ours, as the contract begins on the 11th of July, needs lots of expensive items. We need to measure areas for such items as a TV, refrigerator, microwave, gas stove, air conditioners for three rooms, ceiling lights for the rooms, and washing machine. Many apartments come totally unfurnished, including lights. That is another story.
NOTE: While there are changes afloat concerning key money, trying to make it clearer and reduce the amount, there remain differences between Tokyo and Osaka areas.
Key money and deposit are sometimes combined. Sometimes not. Obviously, all to confuse the renter. It is a very successful strategy, as my wife and I were always confused.

Review of Our Monthly Rental CostsA quick review of our monthly costs at this apartment.
Rent is 130,000 yen. (賃貸 chintai)
Property maintenance is 8000 yen. (共益費 kyouekihi or 管理費 kanrihi)
The total is 138,000 yen which equals about $1,200 at a rate of 115 yen/dollar.
Summary of Costs for Renting our 3LDK3 LDK stands for living room, dining room, kitchen, and three rooms with one bath.
Rent for 1st month is 130,000 yen. (賃貸 chintai)
The property maintenance fee is 8000 yen. (共益費 kyouekihi)
Realtor Fee of 1 month is 130000 yen. (不動産手数料 fudousan tesūryou)
Key money is 390,000 yen. (謝金 shakin/ 礼金 reikin)
Security deposit is 130,000 yen. (保証金 hoshoukin)
2-year fire insurance is 20,000 yen. (火災保険料 kasai hokenryou)
TOTAL 808,000 yen or $7026
(115 yen/dollar rate when we rented.)