Method of purchasing.

(1) Procedure of purchasing.

• Choose a property to purchase.
• Make an offer to the seller
• Agents start to negotiate
• 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 conditions stated including the purchasing price, contract date, closing date and the deposit amount. The deposit amount is regularly 5% to 10% of purchasing price, and the contract is within 3days to 1week after signed the letter of offer. Agents explain the important matters to the purchaser at the contract. The closing date is 1 or 2 months after the contract.

The purchaser is allowed to cosign the signing of SPA to someone who you know in Japan, or to the lawyer here by the power of attorney. And about 1 month after, the lawyer collects the title dead.

(4) Expenses

Tax
Acquisition Tax (The bill comes 2 – 3 months after)
Registration Tax ( Transfer the ownership from the seller to the purchaser.)
Stamp Duty: (The amount is depending on the purchasing price.)

Fees
Lawyers Fee (Fees to make a transfer of ownership.)
Agent Commission (The purchasing price times 3% + 60,000yen + Tax)
Tax agent deputy registration Fee (If cosigned to us, 100,000yen + Tax)

Sundry Expenses
Fire insurance (Include the earthquake insurance.)
Bank Charges (The charge to transfer the amount to the seller)

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

About 7% to 8% of purchasing price is expenses when including the cost above. If the purchaser to take a mortgage, it costs extra such as the establishment of mortgage tax, stamp duty for the contract with the bank, and bank handling charges.

(5) After purchased a property.

Tax
Income tax
Property tax

Management
Property management 5% + Tax of rental fees when tenanted.
Agent commission at the start of lease
Tax return fee (The basic fee is 30,000yen + Tax)

Income tax varies and the rate differs depending on the income after subtracting all the costs to run the rental property, and depreciation.

All the property owners have to pay property tax every year. Property tax depends on the value evaluated by the government and changes every year.

(7) Expenses at the sale

Fees
Lawyers fee (Make a transfer to the new owner.)
Agent Commission (The purchasing price times 3% + 60,000yen + Tax)

Tax
Stamp Duty (The amount is depending on the selling price.)
Capital gain tax (If sold less than 5 years 30% of profit gained, if sold after 5
Years, 15% of capital gains tax is levied. )

If there is the settlement of mortgage, lawyer charges additionally.

(8) Introduction of banks for foreigner mortgage.

We have a couple of connections with banks for the mortgage in which foreigners are able to take out the mortgage on purchasing real estate in Tokyo.