Can American buy and own house in Japan?

Authored by the expert who managed and guided the team behind the Japan Property Pack

Everything you need to know before buying real estate is included in our Japan Property Pack

Who is the author of this content?

BAMBOOROUTES

A team specialized in real estate investing in APAC countries (Japan, Thailand, Indonesia, Australia, etc.).

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Japan. If you'd like to learn more about us, you can check our presentation page.

How this content was created 🔎📝

At BambooRoutes, we explore the Japanese real estate market every day. Our team doesn't just analyze data from a distance—we're actively engaging with local realtors, investors, and property managers in cities like Tokyo, Osaka, and Kyoto. This hands-on approach allows us to gain a deep understanding of the market from the inside out.

These observations are originally based on what we've learned through these conversations and our observations. But it was not enough. To back them up, we also needed to rely on trusted resources

We prioritize accuracy and authority. Trends lacking solid data or expert validation were excluded.

Trustworthiness is central to our work. Every source and citation is clearly listed, ensuring transparency. A writing AI-powered tool was used solely to refine readability and engagement.

To make the information accessible, our team designed custom infographics that clarify key points. We hope you will like them! All illustrations and media were created in-house and added manually.

Can Americans legally buy and own houses in Japan?

Americans can legally buy and own houses in Japan with no restrictions based on nationality.

Japan's property laws treat foreign buyers exactly the same as Japanese citizens. There are no caps on the amount, value, or duration of ownership for Americans purchasing residential real estate.

The Japanese government allows Americans to own both the land and the structures on it, which differs from some other Asian countries where foreigners can only lease land or own buildings but not the underlying property. This means Americans can purchase detached houses, condominiums, and even vacant land for future development.

As of September 2025, the only exceptions apply to agricultural land, forestry land, and property near military zones, which require special permission from local authorities. However, these restrictions also apply to Japanese nationals, making the playing field completely level.

Property ownership in Japan is governed by the Civil Code and Real Property Registration Law, both of which make no distinction between Japanese and foreign buyers.

Do Americans face any restrictions compared to Japanese citizens or other foreign buyers?

Americans face no additional restrictions compared to Japanese citizens or buyers from other countries when purchasing property in Japan.

The Japanese real estate market operates on a nationality-blind basis, meaning Americans enjoy the same property rights as Japanese citizens. There are no extra taxes, surcharges, or administrative obstacles specifically targeting American buyers.

This equal treatment extends to all aspects of property ownership, including the right to sell, rent out, renovate, or pass the property to heirs. Americans can also purchase multiple properties without any government approval or reporting requirements beyond standard transaction documentation.

Unlike some countries that impose foreign buyer taxes or ownership percentage limits, Japan maintains a completely open property market. This policy stems from Japan's broader approach to encouraging foreign investment and international business relationships.

It's something we develop in our Japan property pack.

Do Americans need to be residents or hold a specific visa to purchase property in Japan?

Americans do not need to be residents or hold any specific visa to purchase property in Japan.

Property ownership is completely separate from immigration status in Japan. Americans can buy real estate whether they're tourists, temporary visitors, or have never set foot in the country. This means you can purchase a house in Tokyo while living in New York without any legal complications.

However, it's important to understand that buying property does not grant any residency rights or make obtaining a Japanese visa easier. Property ownership and immigration are handled by entirely different government departments with separate requirements.

Many Americans purchase Japanese real estate as investment properties or vacation homes while maintaining their primary residence in the United States. The Japanese government views this as beneficial foreign investment rather than a pathway to residency.

Is it necessary for Americans to be physically present in Japan to complete the purchase?

Americans are not required to be physically present in Japan to complete a property purchase.

The entire transaction can be handled remotely through power of attorney arrangements. This allows Americans to authorize a trusted representative, typically a real estate agent or lawyer, to sign documents and complete the purchase process on their behalf.

Many Japanese real estate agencies and law firms specialize in remote transactions for international buyers. They can coordinate document signing, fund transfers, and property registration from abroad. Digital document signing and international wire transfers make the process increasingly streamlined.

However, being present in Japan can be beneficial for property inspections, meeting with agents, and understanding local market conditions firsthand. Many American buyers choose to visit Japan during the property search phase but complete the final purchase remotely.

What taxes and fiscal obligations do Americans face when buying and owning a home in Japan?

Americans pay the same property-related taxes as Japanese citizens when buying and owning homes in Japan.

The main taxes include acquisition tax (3-4% one-time payment), registration and license tax (0.1-2%), stamp duty on contracts based on property value, annual fixed asset tax (1.4% of assessed value), and city planning tax (0.3% where applicable). These taxes are calculated using the same rates and assessment methods for all buyers regardless of nationality.

Americans must also consider their US tax obligations when owning Japanese property. The IRS requires reporting of worldwide income, including rental income from Japanese properties. Additionally, Americans may face capital gains taxes in both countries when selling Japanese real estate, though tax treaties can help avoid double taxation.

Property inheritance taxes apply if passing Japanese real estate to heirs, with rates varying based on property value and relationship to the deceased. Americans should consult both Japanese and US tax professionals to understand their complete fiscal obligations.

What is the step-by-step process for Americans to buy property, and which documents are required?

Step	Action Required	Documents Needed
1. Property Search	Find property through agent or listings	None required
2. Offer & Intent	Make offer and sign Letter of Intent	Passport copy, proof of funds
3. Purchase Agreement	Sign Sales and Purchase Agreement	All identification documents
4. Deposit Payment	Pay deposit (5-10% of purchase price)	Bank transfer documentation
5. Due Diligence	Property inspection and legal checks	Property registry, building certificates
6. Final Documentation	Prepare all required paperwork	Income proof, address verification
7. Settlement	Pay balance, taxes, and fees	All previous documents plus payment proof
8. Registration	Register ownership at Legal Affairs Bureau	Completed registration forms
9. Key Handover	Receive keys and take possession	Final ownership certificate

Is hiring a lawyer mandatory for Americans when purchasing real estate in Japan?

Hiring a lawyer is not legally mandatory for Americans purchasing real estate in Japan, but it is highly recommended.

While Japanese law doesn't require legal representation for property transactions, the complexity of Japanese contracts, language barriers, and unfamiliarity with local procedures make professional legal assistance valuable. Many Americans choose to work with bilingual lawyers who specialize in international real estate transactions.

Lawyers can review purchase contracts, assist with due diligence, handle power of attorney arrangements for remote purchases, and ensure compliance with both Japanese and US tax obligations. They can also help navigate any complications that arise during the transaction process.

The cost of legal representation typically ranges from ¥200,000 to ¥500,000 ($1,300 to $3,300), which is often worthwhile considering the investment size and potential complications of international property purchases.

Can Americans access mortgages in Japan, and if so, what are the typical rates and conditions?

Americans can access mortgages in Japan, but securing financing as a non-resident is challenging and often requires meeting strict criteria.

Most Japanese banks require mortgage applicants to have long-term residency status, stable income in Japan, and established Japanese credit history. Non-resident Americans typically face rejection from major banks or must provide significantly higher down payments of 30-50% or more.

For Americans who do qualify, mortgage rates in Japan are exceptionally low by international standards, typically ranging from 0.5% to 2.5% as of September 2025. Loan terms can extend up to 35 years, making monthly payments quite manageable for qualified borrowers.

Some international banks and specialty lenders offer financing solutions specifically for non-resident foreign buyers, but these come with stricter terms, higher rates, and larger down payment requirements. Alternative financing options include seller financing or partnering with Japanese residents who can secure more favorable loan terms.

It's something we develop in our Japan property pack.

We did some research and made this infographic to help you quickly compare rental yields of the major cities in Japan versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.

What tips help Americans secure mortgage approval as foreigners in Japan?

Several strategies can improve Americans' chances of securing mortgage approval in Japan.

1. **Obtain permanent residency status** - This significantly improves approval odds as banks view permanent residents as lower flight risks2. **Establish Japanese credit history** - Open bank accounts and maintain positive financial relationships with Japanese institutions3. **Document stable Japan-based income** - Show employment contracts or business income generated within Japan4. **Provide substantial down payments** - Offer 40-50% down payment to reduce lender risk5. **Work with bilingual mortgage brokers** - Use specialists who understand both foreign buyer needs and Japanese banking requirements6. **Consider guarantor arrangements** - Partner with Japanese nationals who can co-sign or guarantee loans7. **Target foreigner-friendly banks** - Focus on international banks or regional banks with experience serving foreign clients

Building relationships with Japanese financial institutions before needing a mortgage can also improve approval chances. Some Americans establish business relationships or maintain accounts for several years before applying for property financing.

Where do Americans most often choose to settle in Japan, and why?

Americans most commonly choose to settle in Tokyo, particularly in international-friendly wards like Minato, Shibuya, Meguro, and Setagaya.

Tokyo attracts Americans due to its extensive expat infrastructure, international schools, global business opportunities, and comprehensive English-language services. The city offers the highest concentration of international companies, making it ideal for Americans working in Japan.

Yokohama and its suburbs represent the second most popular choice, offering excellent international access, lower property prices than central Tokyo, and proximity to Tokyo's business districts. The area provides a good balance of urban amenities and suburban comfort.

Osaka and Kyoto appeal to Americans seeking vibrant culture, lower living costs, and business opportunities outside Tokyo. These cities offer rich cultural experiences while maintaining strong international connections and business infrastructure.

Okinawa attracts American retirees and military families due to its tropical climate, existing American military presence, and relaxed lifestyle. The region offers a unique blend of Japanese and American cultural influences.

Which Japanese cities or regions are considered the best for living, renting out, or capital appreciation, based on recent livability indexes, rental yields, and market forecasts?

City/Region	Livability Ranking	Rental Yield	Capital Appreciation Potential
Tokyo (Central)	Highest internationally	4-6%	Stable to moderate growth
Osaka	Excellent for business	5-7%	Strong growth, increased international interest
Fukuoka	Rising tech hub	5-7%	High long-term potential, lower entry prices
Kyoto	Cultural appeal	3-5%	Tourist demand, regulatory changes affecting STRs
Sapporo	High quality of life	5-8% (seasonal)	Volatile but growing, winter tourism boost
Okinawa	Vacation destination	4-6%	Modest appreciation, tourism-dependent

What are the common mistakes and pitfalls Americans should avoid when buying property in Japan?

Several critical mistakes can cost Americans significant money when purchasing Japanese property.

1. **Ignoring property depreciation patterns** - Most Japanese homes, especially wooden structures, lose value rapidly while land appreciates slowly2. **Underestimating language barriers** - Failing to use professional translation services for contracts and legal documents3. **Overlooking earthquake building codes** - Not understanding seismic safety requirements and retrofitting costs4. **Assuming ownership grants residency** - Believing property purchase provides immigration benefits or visa advantages5. **Neglecting property management costs** - Underbudgeting for maintenance, especially for non-resident owners6. **Misunderstanding tax obligations** - Failing to plan for both Japanese and US tax implications7. **Skipping professional inspections** - Not conducting thorough structural and legal due diligence8. **Choosing inappropriate financing** - Accepting unfavorable loan terms without exploring alternatives

Americans should also avoid rushing into purchases without understanding local market conditions, building quality standards, and long-term maintenance requirements. Working with experienced professionals familiar with international transactions significantly reduces these risks.

It's something we develop in our Japan property pack.

Conclusion

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.

Sources

1. Wise - How to Buy a House in Japan
2. BambooRoutes - Can Americans Buy Property in Japan
3. BambooRoutes - Japan Real Estate for Foreigners
4. Housing Japan - Buying a House as an Expat
5. Land Housing - Foreign Property Purchase Guide
6. Mailmate - Living in Japan After Buying Property
7. E-Housing - Property Buying Guide
8. Dovetail - Step-by-Step Buying Guide