A retreat in the east.

December 16, 2008 2:49 AM

Has anybody borrowed money to buy a condo or house in Japan? Is it true that Japanese lenders only give mortgages to home buyers who work for big or established companies?

In addition to other places, like Florida, I'm thinking of Tokyo as a possible location for buying a small condo. I have experience in the country and a Japanese spouse, so I'm not worried about the paperwork and adaptation issues.

However, I've heard through the rumor mill that Japanese banks only lend to people who are longtime employees of reputable companies. Many of my friends, on the other hand, say that a few years of documented income is all that's required.

Which of these views is correct? What are your experiences in working with Japanese banks to buy a house or condo ("mansion")?

posted by Gordion Knott to work & money (7 comments total)

My own experience is that you don't need to work for a big company. I'm self-employed, and got a mortgage eight years ago (just two years left to run ... yay!)

I did need to show income tax records going back a few years, to convince them that I had a (basically) stable income. Other factors would be that I have permanent residency, although no spouse (I am divorced), that I was buying the place at a very discounted price (minimizing their risk if they had to repossess), and that I had been banking at that same institution for fifteen years already ...
posted by woodblock100 at 4:40 AM on December 16, 2008

As I'm finding out now, you can't get a loan under your name without the permanent residency. A spouse visa won't cut it. In order to own land, it seems, or secure the loan that allows you to do that, you need to be a PR or a naturalized citizen.

The first mansion we looked at, though, the salesman asked about our respective jobs. My wife works for a long-established department store in Tokyo. I teach at a university. This was long before any questions about my visa status popped up, and the guy made a little bit of a face, then said they'd use my wife's job and income to apply for the loan.

In other words, there may be some jobs that are more likely to get loans, just like, well, anywhere.

Supposedly, however, there are more and more avenues to securing loans, including trying places like Citibank, which has made inroads into Japan.

Best of luck. Downtown Tokyo? Or out west a bit?
posted by Ghidorah at 5:42 AM on December 16, 2008

Ghidorah,

>Best of luck. Downtown Tokyo? Or out west a bit?

Most likely downtown Tokyo, in the Chiyoda-ku area or similar.

I'm thinking of using my spouse's name and Japanese citizenship for the loan, if necessary. With only partial residency (during the winter months) each year. Based on your experience, do you think this might pose a problem?
posted by Gordion Knott at 5:56 AM on December 16, 2008

Another good source of information you might try is the 'gdiy' ('gaijin do-it-yourself') group - around 80 people, many of whom have bought/built their own homes here in Japan. You can find it here.

Either browse the group archives looking for posts on this topic, or join up and ask your question there ...
posted by woodblock100 at 6:25 AM on December 16, 2008

Our very own woodblock100 tells his story of getting a house & home loan here.
posted by troy at 10:54 AM on December 16, 2008

d'oh.
posted by troy at 10:55 AM on December 16, 2008

I think the key is that, if you're only living here part-time, you'll need to keep your visa up to date. I'm not sure how willing I'd be to volunteer information on how often you'll be out of Japan. I think there's likely enough unwillingness to offer loans to what banks feel are risky folk (the joys of not being Japanese...) that letting them know right off the bat you might not be around all that much might make rejection more likely.

The best thing to do would be to get your spouse visa, and update it religiously. Answer any mail from your bank quickly, and make sure you have some sort of proxy (mail forwarding might take too long, what with the international posting thing) in Japan to take care of anything regarding your mansion, loan, or relations with the bank or other folks in the same building.

Best of luck, and let us know how it goes.

Just as a precautionary note, numbers just came out last night saying that the number of mansions on the market just dropped about 14%, due to a combination of people not moving, and also due to a scarcity of new places. I'm personally unclear on whether this is a good time to buy or not. There's scarcity, which means prices should go up, but at the same time, the scarcity exists because people aren't buying.
posted by Ghidorah at 8:53 PM on December 16, 2008