Mortgage eligibility, fixed vs floating, closing costs, and rent-vs-buy.
Home loans (住宅ローン) in Japan are relatively cheap by global standards, but eligibility is the hurdle for many foreign residents. Banks weigh stable employment, income, length of residence, and — critically — permanent residency. Without PR, some banks decline, others require a larger down payment or a guarantor; Flat 35 (via the Japan Housing Finance Agency) is a common route because it is more rules-based and does not always require PR.
The core choice is fixed vs floating (固定 vs 変動). Floating rates have been very low but can rise; fixed rates (including Flat 35) cost more now for certainty later. Beyond the rate, budget for closing costs (諸費用) of roughly 6–10% of the price — registration, agent fees, loan guarantee, taxes, and fire insurance — which are easy to underestimate.
Rent-vs-buy in Japan is not just financial. Many buildings, especially older wooden houses, depreciate rather than appreciate, and resale liquidity varies by location. This section frames eligibility, total cost, and the risks (interest-rate, resale, maintenance, and natural-disaster) rather than pushing you toward buying.
How permanent residency, income, and Flat 35 affect your chances.
Permanent residency strongly helps; without it expect stricter terms or a larger down payment, though Flat 35 is often accessible without PR.Why buying is not automatic wealth-building, and how to frame the decision.
It depends on how long you will stay, job stability, and the property; many Japanese homes depreciate, so treat a home as shelter first, investment second.Fixed-rate mortgage · Japan Housing Finance Agency
A long-term fixed-rate mortgage program backed by the Japan Housing Finance Agency, offered via partner lenders and often accessible without permanent residency.
Fees: Rate and fees vary by lender and loan-to-value — verify current terms.
It is harder but possible. Many banks strongly prefer permanent residency; without it you may face a larger required down payment, a Japanese spouse guarantor, or rejection at some lenders. Flat 35, offered via the Japan Housing Finance Agency, is more rules-based and does not always require PR, making it a common route for non-PR residents. Stable long-term employment and income are decisive. Terms vary widely by bank, so compare several.
There is no universal answer. Floating rates (変動) have been lower and reduce early payments but can rise, increasing your payment later. Fixed rates (固定, including Flat 35) cost more now but lock certainty for the term, protecting you if rates rise. Choose based on how much payment-increase risk you can absorb: if a rate rise would strain your budget, the certainty of fixed can be worth the premium. Model both before deciding.
Beyond the down payment, budget roughly 6–10% of the price for closing costs (諸費用): the agent’s brokerage fee, registration and judicial-scrivener fees, loan guarantee and administration fees, stamp duty, acquisition and property taxes, and fire/earthquake insurance. New-build and pre-owned costs differ. These are easy to underestimate, so get an itemized estimate before committing.
It depends on how long you will stay, your job stability, and the specific property. Unlike some countries, many Japanese homes — especially older wooden houses — depreciate, and resale can be slow outside prime areas, so buying is not automatically wealth-building. Renting keeps you flexible, which matters if you might move or leave Japan. Buying can make sense for long-term residents wanting stability who have modeled the full cost and resale risk. Treat a home as shelter first.
Japan has credit information agencies — CIC (cards and installment), JICC, and the bank association’s KSC. You can request your own disclosure from each, usually online or by mail for a small fee. It shows your cards, loans, and any late payments (異動 marks). Checking before a mortgage application helps you spot and resolve problems — like a forgotten missed payment — that could otherwise cause a rejection.