HOW TO LIVE IN TOKYO: INSIDE JAPANS REAL ESTATE MARKET
Tokyo is a city of many faces. From the narrow neon studded alley ways to the skyscrapers that illuminate the notorious Tokyo skyline at night, the Japanese capital is thought of as a metropolis that never goes to sleep, where you can always find something happening behind closed doors at any given moment.
But if you take a closer look at the maze-like grid that keeps the city alive, you will soon realize that it offers much more than just concrete high-rises and office buildings.
The Daiichi Sugawara Building in Ginza, Tokyo
The Higurashi izakaya restaurant in Ikebukuro, Tokyo.
Even though you might feel like an ant next to the high-rises that grow into the sky around Shimbashi, Roppongi or Nihonbashi, more often than not, you’re only one turn away from a nostalgic Yokocho. As the welcoming glow of the red lanterns signal small Izakayas and a good night out, the awareness of the sudden yet dramatic change in landscape oftentimes falls short.
Goto-Inari Shrine in Kanda, Tokyo.
Kaminarimon Yanagi-kōji Street in Asakusa.
In between the increasingly monotonous office-scape that thousands of salarymen flock to 5 days a week (and sometimes more), smaller and significantly older buildings have been occupying the land far before their boujee neighbors started claiming today's business districts to erect the latest, arguably soulless, corporate headquarters. But it is exactly this colorful contrast between tradition and innovation, wood and concrete, brick-and-mortar and global commerce that makes the landscape of Japanese cities so unique and exciting.
Kyoto’s famed Pontocho Alley. A geisha and maiko district with a history dating back to the 18th and 19th centuries. The narrow paved street is lined with restaurants, bars and tea houses. See if you can spot the tea house designed by Shin Takamatsu in 1982.
Similarly, Japanese residential areas often boast an architectural style mix that couldn’t be more diverse. Partially attributable to a lack of council building committee approvals, it's not uncommon to come across a Tadao Ando-designed house right next to a wooden shack straight from the Showa era - all it takes is an adventurous home-owner and a creative architect. On the other hand, these “vintage” spaces from the Showa and Meiji-era are currently experiencing a real renaissance moment, as a new wave of shop and cafe owners are snapping up the property to renovate them to prolong their lifespan in style.
A quiet laneway in Gion.
But how exactly does the ownership handover happen in a country as bureaucratic as Japan and what should foreigners keep in mind to avoid any missteps when moving to Japan? Who are the people that are looking for these kinds of Japanese designer homes and what makes the Japanese real estate market in general so different compared to its western counterparts?
Natural Stick II by EDH Endoh Design House, 2012.
To shed some light onto those questions and many more, we caught up with seasoned real estate expert and owner of the agency Japan Property Central, Zoe Ward. Having spent most of her adult life in Japan, Zoe has embarked on her real estate journey upon her arrival in Japan, when she was helped by an English-speaking agent and realized a gap in the market: Offering a tailor-made brokerage solution for the foreign community.
The former Mitsui Shimogamo Villa. Built in 1925.
Since then, she has opened her own agency in 2014 and has made a name for herself by filling that niche, with a slight twist. Next to expats looking for a place to rent or buy in Tokyo, she looks after a particular subset of foreign clients with an appetite for the subtlety of Japanese design sensibilities - or as we would say in Japan - a flex piece. From introducing prospective buyers to villas by famed architects or historic residences in the most sought-after neighborhoods like Omotesando, Akasaka, Azabu and Roppongi, Zoe has seen and brokered it all.
Reflection of Mineral, Atelier Tekuto, 2006.
Being over 7 years in the business and having experienced the local market and all its intricacies, Zoe is a real master of the acronym-riddled Japanese housing sphere and knows the latest real estate trends. In order to capture and explain the latest local happenings and hottest vacancies, Zoe is also behind the lens of her agency's very own Instagram channel, which conveniently allows her to roam the areas and keep her ear to the street. Offering a real, undistorted view into Tokyo neighborhoods, her IG posts captivate through a consistent aesthetic that highlight the everyday beauty of the city alongside the buildings that make the city so beautiful in the first place.
A private residence by Hiroshi Miyazaki of Plants Associates.
So without further ado, we present to you our incredibly insightful interview with Zoe from Japan Property Central, allowing you a peek behind the Tokyo real estate scenes and offering a first reference point for anyone contemplating a move to Japan.
Thank you very much for taking the time to talk to us. Could you please briefly introduce yourself to the Sabukaru network?
My name is Zoe Ward and I am the owner and operator of Japan Property Central KK, a real estate brokerage in Omotesando, Tokyo. I’m originally from Australia but have been living and working in Japan for most of my adult life. I established my real estate company in 2014 and we work primarily with buyers, both within Japan and from overseas.
What got you initially interested in working in real estate?
When I moved within Japan for the first time I was helped by a wonderful English-speaking agent in Kobe (Rica Bradshaw of Core Eight Co., Ltd.). Foreign residents don’t have an easy time finding homes to rent, but she made the process go so smoothly. I could see there was a niche helping the foreign community, because there aren’t many brokerages that specialise in this sector and there isn’t a lot of readily available information in English either.
Akabeko, an izakaya restaurant in Nakameguro.
What makes the Japanese real estate market so exciting?
It’s an incredibly diverse market with all sorts of quirks and stories that are associated with the different types of locations and buildings. I have found it fascinating over the years to learn about what makes some places gems and others lemons.
The machiya-lined street that leads to sculptor Kawai Kanjiro’s house.
What are the main differences between the Japanese and “Western” real estate markets?
There will often be two real estate agents in a deal, one representing the seller/landlord, and one representing the buyer/tenant. But, there are times when the same agent represents both parties and that is perfectly legal. There are no disclosure obligations about this either, and at the beginning you may not be fully aware who your agent is really working for.
An old shophouse near Yushima Station.
In most transactions, the buyer/tenant will pay a brokerage fee. The seller/landlord will also pay one.
An old merchant house in Yushima.
All of the documentation and communication is in Japanese. Even if you are comfortable with speaking and reading Japanese, it might be advantageous to use an agent that has experience with foreign customers as there are many cultural barriers that we need to navigate as well. Normally, it shouldn’t cost any extra to do so.
Five floor 20 meter tall house in Tokyo.
One of the unique characteristics of Japanese cities is that they surprise you with a wildly diverse mix of architectural styles. What is the reason behind this architectural freedom in Japan?
My guess is the lack of council building committee approvals. As long as your building plans meet the construction code and any other zoning regulations and local bylaws, you should be good to go. That’s why you might see a house shaped like a giant egg or painted like a candy-cane. When you have the perfect combination of an adventurous home owner and a creative architect, it can result in some fantastic homes in otherwise unassuming residential neighborhoods.
Traditional restaurants lining the side of Kamogawa River during the warmer months.
Some districts do have rules about design, so you may not be able to go completely wild in some of the heritage districts like Kyoto or the serene parts of Karuizawa.
The Japanese real estate market is riddled with building categories and abbreviations. Could you please shed some light on some of the key terminology and building types from apartments to mansions, 1R to 2LDK, what they mean and what kind of price tags are to be expected?
For studio apartments, they are usually called 1R (one room), or 1K (one kitchen). The difference being that a 1K has a door separating the kitchen, and a 1R doesn’t. A 1LDK means one bedroom + a living/dining/kitchen. A two-bedroom is a 2LDK, and so on.
The Goto-Inari Shrine in Kanda.
Most small studio apartments in Tokyo can be found for under 100,000 Yen a month. The rent is largely determined by the total size of the apartment or house, along with the building age and location.
The courtyard garden behind Weekenders Coffee Roastery.
The word Mansion in Japan refers to an apartment/condo, usually in a reinforced concrete building, and not a big, fancy house like its name would suggest. An ‘Apaato’ refers to an apartment usually in a low-rise, wooden or steel frame block of flats.
Atelier No. 7 by Seiichi Shirai. Built in 1959.
We heard that there are specific moving seasons in a year in Japan. How did this come about and why does it make (not) so much sense?
The school year and the year that many companies hire new staff starts on April 1, so the busy moving season will be anywhere from January to March. Companies might also rotate staff in September and October, which makes those months busy for moving. During the busy times of the year, properties get snapped up quickly and moving companies can be more expensive and difficult to book. If you can wait until the off-season, you might have a smoother time with moving but the good properties might be taken.
Nihon Kensō. An old billboard-style facade for a company that provided signboards and other painting jobs.
There are special designations for apartments close to cemeteries, gang related locations or recent deaths/killings. What’s the backstory of these places needing special designation, how does it impact prices and is there perhaps a special customer segment interested in these?
Anything that might be considered off-putting to a tenant or buyer is usually disclosed in the documentation to avoid potential complaints down the track, although the laws are currently a little vague on what is considered a defect. A crematorium nearby, for example, might be disclosed, along with a criminal organization having an office in the neighborhood. Those examples might not have a huge impact on prices, at least in the high demand locations in central Tokyo. If there was an unnatural death within the house or apartment, it must be disclosed to the buyer/tenant. There are very hefty penalties on us as brokers if we attempt to hide that information, so most agents will disclose it for the sake of protecting themselves from any legal troubles. The impact on price will depend on the severity of the incident and how long ago it occurred.
Nihon Kensō.
What kind of properties are popular with the richest of rich Japanese clients? What does that property need to bring to the table and what kinds of properties are popular with that clientele?
Privacy and location is key. They will be looking for either detached homes, or land they can build a large home on, or apartments in buildings that don’t have a lot of neighbors. Some may have private elevators, or elevators going directly to the basement garage. Security must also be tight, with several locked entrances, and on-site caretakers. They will typically be looking in the very central parts of Tokyo, such as around Omotesando, Akasaka, Azabu and Roppongi, but they will also drop some serious money on holiday homes in Kamakura and Karuizawa, and traditional historic estates in Kyoto City.
A house designed by Tadao Ando and built in 1993.
Japan being an island, space is a limited and coveted commodity. Naturally, apartments tend to be more compact compared to Western standards. How do these constraints translate into the space management and cuts of Japanese properties?
A standard three-bedroom apartment will be around 70 sqm, and most new houses are under 100 sqm. Everything is on the small side. Small bedrooms often mean the beds have to be pushed up against the walls, with little space for other furniture. In second and third bedrooms there may only be room for a single bed. Closets and storage are very limited. If you run out of storage space, you can rent a trunk room storage space within the building, if it has them, or at the many storage shed-type places dotted around the city. Of course, you can have a bigger place but every square meter counts in terms of pricing so be prepared to pay more for it. Apartments over 100 sqm are considered a luxury and come with luxury price tags, and very limited supply.
A post-war house on the west side of the Imperial Palace.
From Meiji-era traditional homes to Tadao Ando-designed villas, you boast quite the diverse real estate portfolio. Can you share some insights on what kind of clientele is interested in these unique places and why that is the case?
Most of our clients are looking for a holiday home in Japan where they can spend time when they visit. For that reason, they want something different to the standard cookie-cutter, cramped housing. Instead, they want something that embodies the subtle Japan design sensibilities that you see in magazines. They might have a practical family home in their own country, but want to have a unique showpiece, new or historic, in Japan for their family and friends to stay when they visit.
A contemporary pentagonal home in Asakusa.
For our foreign clients who live in Japan, practicality and location is more of a priority but again, there has to be a contemporary design aspect to the property. Natural sunlight, lots of windows, and an open layout are a must.
A beautiful seating area on the second floor of artist Kawai Kanjiro’s house in Higashiyama, Kyoto. Built in 1937 and open to the public as a museum.
You also cater to a somewhat niche “collectors audience'' with some of your listings. What are the intricacies of working with these kinds of clients and what do they look for/value in real estate?
This type of client is looking for something by a famed architect, something historic, or something with some charm. They are still looking for the trifecta of design, price, and location, but with an emphasis on finding a building with a unique design. Of course, it still has to be in a location that is accessible and not completely remote, especially if they are looking to open a shop or run some kind of business.
An old machiya with a facade renovated by a well-known local architect.
These clients are usually very patient. They have to be because there might only be one suitable listing come up every one or two years, or longer.
Sportswear store Columbia opened a shop in this 100-year old machiya alongside Rokkaku Street in September 2019. The traditional kyo-machiya had previously been used as a private residence.
What was a listing that stood out to you personally? What made it stand out to you?
In a good year I might find one or two listings that are really stand-out properties from an architectural or historic perspective. One that stands out was a house by Tadao Ando in the Daikanyama neighborhood. It had a lot of large windows and sunlight, while also being private from the street. I had the chance to show it to some clients, but sadly they all passed on it! Looking back it had all three check marks: design, price and location. I now have a couple of keen potential buyers who want to be informed if the current owner ever wants to sell, and I’m sure other brokerages in the city would have a list of interested clients, too.
Due to Japan’s aging demographics, the fate of a lot of older homes is up in the air. Can you tell us what happens to these houses typically once they become vacant?
If the land is desirable, someone will buy the old house, demolish it and build something new. In that case, the property will be valued at whatever the land value is, and minus a tiny amount for the demolition costs. Banks typically won’t provide home loans on older homes, so the potential buyers would be limited to those who were going to demolish and build something new that meets the loan terms, or full cash buyers. If it is in the countryside where the aging demographic is of real concern and land is not in short supply, the homes usually fall into complete disrepair and become overgrown and abandoned.
Nihon Kensō.
It seems that showa-era houses are experiencing a real renaissance-like moment. What is the charm of buildings from that era and what kind of customer is interested in those properties?
It’s very difficult, and impossible in most cases, to get a home loan to buy a house from the showa-era, so the resale market of these old houses is quite limited unless they are just being sold for the land. One sector of the market where they are doing well is in retail leasing. In the more trendy neighborhoods like Nakameguro, Harajuku/Jingumae, and Shimokitazawa, you will see them occupied by coffee shops, restaurants, and boutiques. They often strip back the interiors to create open spaces with exposed beams. It gives the store and their brand so much more character and appeal than they might get from a newer and blander building.
The corner of Karasuma and Aneyakoji Streets, Kyoto.
Your agency’s Instagram uploads stunning photos of buildings all around Tokyo and impressively details their backstories. How would you describe your photography style and what are some of the details you try to capture?
I want to show a more local side of Tokyo that isn’t just glass skyscrapers and crowded tourist spots. There are so many little laneways and neighborhoods filled with small shophouses and bars frequented by locals that you won’t find in the guidebooks. You can spend hours wandering around the downtown shitamachi districts and always find something new. Maybe it’s an old shophouse that you always thought was vacant, but at dusk you see some lights on or some laundry out.
AWOMB sushi restaurant. The store was designed by Endo Shojiro Design in 2014. It’s an old machiya townhouse from the early 1900s.
For anyone that is considering a move to Japan and is looking for accommodation, what would be a good starting point or (online) resource for finding a place to stay?
There are a few online forums and English-speaking listing aggregate sites that are a good place to start. My best recommendation would be to reach out to some agents with questions and start to build up a good relationship. All you really need is one good agent on your side. We all have access to the same listings and we all charge the same industry-set standard fees (but please check in case some charge extra).
Sunset alongside Matsubara-dori Street.
Do you have some words of advice for foreigners that want to come to Japan and are on the property hunt?
Walk around the neighborhood on your own, without the real estate agent, before making a final decision. Check out things like noise, traffic, shops. If you are commuting into the office during rush hour, maybe do a trial run on the train in the morning to see if it’s something you can handle. Some stations and some train lines are more crowded than others. Moving is a very costly exercise, and spending a little time getting to know a neighborhood first can be a good investment in your overall happiness.
Some beautiful homes behind Ninenzaka.
The Sabukaru audience is very diverse, ranging from teachers to scientists to creatives that are interested in Japanese culture. For those that are looking into moving to Japan and are looking for a place, are there any client criteria/requirements you might have or do you accept anyone as a potential new client?
We work on the sales side, primarily with buyers, and mostly for properties in central Tokyo priced above 100 million Yen. We do conduct a preliminary interview before onboarding a new client to see if we are a good fit and able to find something that will match their needs. It’s a very time consuming task to take a client through the entire purchase process, so we are a bit limited as to how many active buyers we can work with at any given time.
A shophouse with a traditional Japanese and European-style frontage. Built sometime around the 1920s.
Is there anything else that’s special about the Japanese property market that you’d like to mention, anything that we forgot about or deserves more attention?
It can be confusing, fascinating and boring at the same time, and sometimes even downright dodgy. I have been involved in the real estate industry here since 2008 and am still learning new things every day.
THANK YOU VERY MUCH FOR YOUR TIME!
Words by Natsuki Ludwig
Interview by Adrian Bianco and Natsuki Ludwig
Layout by Koko Bond-Razak
