What's the purchase process to buy a property in Hiroshima?

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 Hiroshima. 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 Hiroshima, Tokyo, and Osaka. 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.

How do I find out if foreigners are legally allowed to buy property in Hiroshima?

Foreigners can legally buy property in Hiroshima without any restrictions on land or building ownership.

Japan's property laws allow non-Japanese citizens to purchase real estate regardless of visa status or residency. This means you can buy property in Hiroshima whether you're a tourist, temporary resident, or permanent resident.

The Japanese government does not impose nationality-based restrictions on property ownership, unlike some other Asian countries. You have the same property rights as Japanese citizens once you complete the purchase process.

You can verify this legal right by consulting the Japanese Civil Code or speaking with any licensed real estate agent in Hiroshima. The only requirement is following proper registration procedures through Japan's Legal Affairs Bureau.

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

What are the main types of property ownership in Hiroshima and which one applies to me?

The two main types of property ownership in Hiroshima are freehold (shoyuken) and leasehold (shakuchiken), with freehold being the standard for most residential buyers.

Freehold ownership gives you complete ownership of both the land and buildings on it indefinitely. This is the most common ownership type for houses, condominiums, and investment properties in Hiroshima.

Leasehold ownership means you own the building but lease the land for a specific period, typically 30-99 years. This arrangement is rare for residential properties in Hiroshima and more common for commercial developments.

As a foreign buyer, you'll most likely encounter freehold properties since leasehold arrangements are uncommon in Japan's residential market. Freehold gives you the security of permanent ownership and the ability to sell or transfer the property freely.

Check the property deed (kento shomeisho) to confirm the ownership type before making any commitments.

How do I confirm that the property title is clean and there are no debts or disputes attached to it?

You must obtain a copy of the real estate registry (fudosan tokibo) from Hiroshima's Legal Affairs Bureau to verify clean title and check for liens or disputes.

The registry document shows all past and current owners, mortgages, liens, and legal rights attached to the property. You can request this document in person at the Hiroshima Legal Affairs Bureau or use the online Toki Joho Teikyo Service.

The registry costs approximately ¥600 per property and provides crucial information about outstanding debts, court orders, or ownership disputes. Look for entries showing mortgages (teito ken), liens, or legal proceedings.

Have a Japanese-speaking professional or judicial scrivener review the registry document since it's written entirely in Japanese. They can identify any red flags like unpaid taxes, construction liens, or boundary disputes.

This title search should be completed before signing any purchase contracts to avoid inheriting the previous owner's financial obligations.

What taxes and fees do I need to budget for when buying property in Hiroshima?

Budget approximately 5-10% of the property purchase price for taxes and fees when buying property in Hiroshima.

Fee/Tax Type	Rate	When Paid
Real estate agent commission	3% + ¥60,000 (+ consumption tax)	At contract signing
Registration tax (land)	1.5% of assessed value	At title transfer
Registration tax (building)	0.4% of assessed value	At title transfer
Stamp duty	¥1,000-¥60,000 (varies by price)	At contract signing
Judicial scrivener fees	¥50,000-¥150,000	At settlement
Acquisition tax	3-4% of assessed value	6-12 months after purchase
Property inspection fees	¥30,000-¥80,000	Before purchase

How do I choose and hire a reliable real estate agent or broker in Hiroshima?

Choose established real estate firms in Hiroshima that specialize in serving foreign clients and have bilingual staff or translation services.

1. Look for agents with Japanese Real Estate Transaction Agent licenses (takuchi tatemono torihiki-shi)2. Verify the agency is registered with the Hiroshima Prefecture Real Estate Transaction Business Association3. Ask for references from previous foreign clients who completed purchases4. Confirm they offer services in your preferred language (English, Chinese, Korean)5. Check online reviews and ratings on Japanese real estate platforms6. Ensure they understand foreign buyer financing challenges and visa requirements7. Request detailed fee structures upfront to avoid hidden costs

Reputable agencies often have partnerships with international banks, judicial scriveners, and tax advisors who work with foreign buyers. Avoid agents who pressure you into quick decisions or refuse to provide written fee schedules.

Interview multiple agents before choosing one, and ensure they're willing to accompany you to property viewings and explain contract terms in detail.

What role does a judicial scrivener play in the purchase process and when do I need to involve one?

A judicial scrivener (shiho shoshi) handles legal document preparation, title searches, and property registration at Japan's Legal Affairs Bureau during your purchase.

The scrivener conducts due diligence by checking property records, verifying ownership history, and identifying any encumbrances or liens. They prepare all registration documents required for the title transfer process.

You should engage a judicial scrivener after signing the initial purchase contract but before the final settlement date. They typically need 1-2 weeks to complete their due diligence and prepare registration documents.

Judicial scrivener services cost between ¥50,000-¥150,000 depending on property complexity and additional services like mortgage registration. Many work with real estate agents and can communicate in basic English.

The scrivener represents you at the Legal Affairs Bureau during the final title transfer, ensuring all documents are properly filed and the new ownership is legally recorded.

How do I secure financing in Japan if I'm not a resident or don't have Japanese income?

Securing financing as a non-resident foreign buyer is challenging, with only select "foreigner-friendly" banks offering mortgages under strict conditions.

Banks like Sumitomo Mitsui Trust Bank, PRESTIA, and some regional institutions may consider lending to foreigners, but expect requirements like 20-50% down payments, higher interest rates (2-4%), and extensive documentation including income verification from your home country.

Many foreign buyers choose cash purchases to avoid financing complications. Alternative options include securing a loan in your home country using the Japanese property as collateral, or establishing a Japanese business entity to improve loan eligibility.

Required documentation typically includes tax returns from your home country, employment verification letters, bank statements for 6-12 months, and sometimes a Japanese guarantor. The approval process can take 4-8 weeks.

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

What steps are involved in making a formal offer and signing the initial contract?

The formal offer process in Hiroshima involves submitting a letter of intent, negotiating terms, and signing an initial purchase contract (bai-bai keiyaku) with deposit payment.

1. Submit a written offer (letter of intent) through your real estate agent specifying purchase price and conditions2. Negotiate price, settlement date, and any special conditions with the seller3. Review the draft purchase contract carefully, preferably with a Japanese-speaking advisor4. Sign the initial contract and pay the earnest money deposit (typically 5-10% of purchase price)5. Receive a copy of important property documents including building plans and association rules6. Begin the cooling-off period (typically 7-10 days) during which you can cancel with penalties7. Arrange financing approval and property inspections during the contract period8. Prepare for final settlement 30-45 days after initial contract signing

The initial contract is legally binding once signed and deposit is paid. Make sure all terms are clearly understood before proceeding, as cancellation after the cooling-off period results in deposit forfeiture.

How does the deposit system work and what risks should I be aware of in Hiroshima transactions?

The deposit system in Hiroshima requires paying 5-10% of the property price as earnest money when signing the initial purchase contract.

If you cancel the purchase after the cooling-off period expires, you forfeit the entire deposit. Conversely, if the seller cancels without valid reason, they must return double the deposit amount as penalty compensation.

Deposits are typically held in escrow by the real estate agency or judicial scrivener until final settlement. Ensure the deposit holder is properly licensed and bonded to protect against agency bankruptcy or fraud.

Key risks include losing your deposit due to financing rejection, discovering undisclosed property defects, or misunderstanding contract terms due to language barriers. Always include financing and inspection contingencies in your initial contract.

Request written confirmation of deposit refund conditions and ensure all contract terms are translated into your preferred language before signing.

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 happens during the final settlement and transfer of ownership, and how is payment handled?

Final settlement occurs at either the bank or Legal Affairs Bureau, where you complete payment, receive property keys, and the judicial scrivener registers the new title.

Payment is typically made by bank wire transfer from your account to the seller's account in the presence of all parties. Cash payments are rare for properties over ¥10 million due to anti-money laundering regulations.

The judicial scrivener files the title transfer documents with the Legal Affairs Bureau on the same day as payment. This process takes 1-2 hours and results in a new property deed issued in your name.

You'll receive the property keys, building management contact information, utility account transfer forms, and copies of all relevant property documents. The real estate agent typically facilitates utility transfers and provides neighborhood orientation.

Final settlement includes paying any remaining taxes, registration fees, and professional service fees not already collected during the contract signing process.

What are the common mistakes foreign buyers make when dealing with language, contracts, or hidden costs in Hiroshima?

The most common mistake is proceeding without proper translation of contracts and property documents, leading to misunderstandings about terms and conditions.

1. Not budgeting for acquisition tax, which arrives 6-12 months after purchase as a surprise bill2. Failing to understand condominium management rules and monthly fees before purchase3. Assuming Western-style negotiation tactics work in Japan's more formal business culture4. Not conducting proper property inspections due to language barriers with inspection reports5. Overlooking earthquake insurance requirements and costs for older buildings6. Misunderstanding the cooling-off period terms and cancellation procedures7. Not verifying the property's legal status regarding short-term rental restrictions

Always hire professional translators for important documents and work with agents experienced in foreign transactions. Request detailed cost breakdowns upfront and don't rush the due diligence process.

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

How do I make sure I don't run into confusion about ongoing costs like property management fees, fixed asset taxes, or condominium association rules?

Request comprehensive documentation about all ongoing costs before finalizing your purchase, including annual property tax assessments and monthly management fees.

Fixed asset tax (kotei shisan zei) is calculated annually based on government-assessed property values and typically ranges from 0.3-1.7% of assessed value. You'll receive tax bills directly from Hiroshima City Hall starting the year after purchase.

For condominiums, obtain detailed information about monthly management fees (kanri-hi), repair reserve funds (shizen-hi), and any special assessments planned for building maintenance or renovations. These fees typically range from ¥8,000-¥25,000 monthly.

Review the condominium association's rules (kanyaku) regarding pet policies, renovation restrictions, subletting permissions, and noise regulations. Violations can result in fines or forced sale requirements.

Set up automatic payment systems for recurring costs and maintain communication with building management companies to stay informed about any rule changes or special assessments.

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. Juwai - Foreign Property Ownership in Japan
2. Wagaya Japan - Property Purchase Guide
3. Black Ship Realty - Buying Houses in Japan
4. E-Housing Japan - Land Ownership Types
5. Reddit - Property Ownership Verification
6. Housing Japan - Property Rights Guide
7. Cheap Houses Japan - Buying Advice
8. Reddit Japan Finance - Tourist Property Purchase