5 Things to Look for When Buying an Akiya in Japan
Purchasing an akiya in Japan can be an exciting investment opportunity or a chance to fulfill your dream of owning a traditional Japanese property. However, it’s essential to approach this venture with caution and perform thorough due diligence. Here we outline five key factors to consider when buying an akiya in Japan, to ensure a successful and stress-free purchase.
1. Property condition
The first thing to evaluate is the condition of the house. Vacant properties may have been unoccupied for a long time, leading to potential issues such as structural damage, pest infestations, or mold growth. If there is any doubt about the property’s condition, we recommend conducting a thorough inspection using a professional property inspector. Also, if the property is built on landfill, an SWS test, which is a research method to evaluate residential sites, can help you comprehensively assess the property’s state before making any decisions.
It’s also crucial to be aware of any necessary repairs or renovations that might be required, as they can significantly impact the overall cost of the investment. If you ask us which is better, ¥14 million Yen ($100,000 USD) turnkey property or a ¥4,000,000 Yen ($25,000 USD) property that requires ¥10,000,000 ($75,000 USD) in renovations, we will pick the former option 100% of the time.
The next important consideration is the location of the akiya. As they say in real estate, “Location, location, location!” We help clients to get familiarized with the surrounding area, nearby lifelines, and public transportation accessibility. Additionally, we research the local real estate market to determine the value for money. A well-located akiya is more likely to retain its value or perhaps even increase in worth over time.
3. Legal and title issues
When acquiring an akiya in Japan, it’s vital to ensure there are no legal registration issues associated with the property. We review the property’s legal documentation, only available in Japanese and available via the Ministry of Justice, which comprises the ownership records on file for the land and any buildings. This is where our strategic partnership with licensed brokerage STK Properties is key to helping our clients navigate any potential legal complexities to make sure your investment is protected.
4. Zoning, building, and Short-term stay regulations
Make sure to check the property’s zoning regulations and understand any building restrictions imposed by local authorities. Additionally, if you want to potentially list your property for short-term stays on a platform like Airbnb, you must first determine whether the local rules allow such activity. Also, some properties that don’t have adequate frontage to a 4 meter wide road cannot be razed and rebuilt, which reduces their investment value even if you will keep the existing structure. We help clients understand the rules that apply to the area and their property. This step is crucial to avoid any surprises or complications in the future and ensure your plans align with the rules.
5. Access to services
It’s important to consider the availability of essential services when evaluating an akiya. Look into water, electricity, gas, and sewage connections to confirm their accessibility and assess any associated costs if these services aren’t connected. In rural areas, services such as high-speed internet are surprisingly widespread, but if the nearest convenience store is 5 km away then the property would not be viable unless you have a car. We assist with understanding access to lifelines like supermarkets, hospitals, fire stations, and convenience stores in order to help clients make an informed decision.
Buying an akiya in Japan can be a rewarding investment. However, it requires careful consideration, and should not be pursued without adequate due diligence. At Akiya & Inaka, we are committed to helping our clients buy property in the Japanese countryside with peace of mind.