2015 has been a busy year, just one of the reasons is that in March I bought my first house.
It was a relatively quick and painless process, but it was difficult finding information about all the associated fees in English so hopefully this post will help others.
Back in December 2014, I was browsing the internet housing website Suumo. I wanted to check out the prices, and see what was available in northern Okinawa.
One property in Motobu caught my attention, or to be more specific the view from the house looked amazing. The website showed an approximate location so I decided to drive over.
I found the house, and although there were no FOR SALE signs, I knocked on the door. The owner came out a little surprised, but was very friendly. We had a brief chat and I had a quick look at the exterior. Although it was cloudy, the view was as I’d hoped, fantastic.
The next day I called the toll-free number of the Sumo website and was connected through to the Daikyo office in Chatan. They arranged with the owner for me to look at the exterior and interior of the house.
The house had been built in 1995, and as often happens in Japan, little renovation had been done to the house since. At the very least, the house needed painting and there were many surface cracks in the concrete. The yard was also overgrown with the fence in disrepair.
The interior likewise had some issues with the wooden panelling peeling in places, and signs that at some point there had been water leaks. The kitchen was old and the wooden flooring weathered in patches.
The agency explained that the house probably would need reform both inside and out, but that it had a great view. The original asking price for house and land had been 29 million yen, but was now 25 million.
In its condition the house wouldn’t have seemed like an appealing prospect for most buyers. It needed too much work as a second home for someone from the Japanese mainland, it was too far from Naha for most Okinawans, and it was too far from the bases to be used as a buy to let investment.
For me, the house had great potential and of course that absolutely stunning view. I searched on the internet for other used homes for sale and couldn’t find anything similar at any price. Rather than taking my time, and looking at other options, I contacted the agency and went for a third look at the same house.
I also stopped by the local bank and asked how likely it would be for me to get a mortgage. I was not yet married, but I have permanent residency in Japan, and could show a steady income for the past 10 years. They said that it was feasible, but not guaranteed.
After another look at the property I decided to make an official offer.
Which wasn’t accepted…
To cut a long story short, I made several offers, but in the end I agreed to pay the full 25 million. The next step was signing paperwork and deposits at the housing agency office in Chatan.
5% deposit ¥1,250,000
50% agency fee Chukai-tesuryou ¥ 437,400
At this stage there is a clause which states if the buyer can’t get a mortgage the deposit and fees paid will be refunded.
Next step was contacting a couple of local banks to arrange a mortgage. As the house was already 19 years old, the banks would give a maximum of a 20 year mortgage. I requested a loan of 20 million and within a couple of weeks one of the banks granted the loan. The official day for signing papers and final payment was then set as March 25th.
In Japan, even when buying a house, everything is done in cash. Piles of 10,000 yen notes. On March 25th, the housing agency, owner, a lawyer, Yuki (my fiancé) and I all met at the bank offering the mortgage. The payments required were:
95% of payment ¥23,750,000
Banks loan guarantee ¥344,240
Bank admin ¥32,400
Registration Licence Tax Torokumenkyozei ¥390,000
Judicial Scriveners Fee Shihou-shoshi-Tesuryo ¥222,571
Fire Insurance (20 years) ¥527,400
50% agency fee Chukai-tesuryou ¥ 437,400
The total therefore to purchase a 25 million yen home in Japan was 1,697,400 and 25,496,611 for a total of ¥27,194,011
The day I could move in was set as April 3rd, and I was given a set of keys.
I’d just bought a house. Awesome.