Chapter 12 — Common mistakes

Legal and structural traps

The property cannot be rebuilt

再建築不可. The plot fails the requirement for at least two metres of frontage onto a road of at least four metres. You may repair the existing house indefinitely. You may never replace it.

Why it matters. Financing is very difficult. The pool of future buyers is small. If the house burns down or is destroyed in an earthquake, you own land you cannot build on.

Why people buy them anyway. They are cheap, and for a buyer who intends to restore and keep a machiya, the constraint may not bite. That is a legitimate decision made with open eyes. It is not the same as discovering it afterwards.

How to check. It should appear in the Important Matters Explanation. Your agent should identify it before you offer.

The building is legal but no longer compliant

既存不適格. Built lawfully under rules that have since changed. Common with older buildings that exceed current floor area ratios.

Buyers ask us what the risk is here, and the honest answer is that for someone intending to live in the house, it is small.

You may keep the building. Nobody will order you out of it and nobody will require you to demolish the excess. If the over-built portion was never included in the tax assessment, a recalculation may raise your property tax somewhat — but that is the extent of it. Substantial reconstruction must comply with current rules, which may mean a smaller building than the one standing.

The real consequence is financing, and this is where a foreign buyer's position differs from a Japanese one.

A property that no longer conforms is difficult to lend against. For a Japanese buyer relying on a mortgage, that is a serious problem — it narrows their options at purchase and narrows the pool of buyers when they come to sell.

If you are buying without a visa, you are almost certainly paying cash anyway. The constraint that makes this a headache for domestic buyers does not bite on you in the same way. It still affects resale, because your eventual buyer may need a loan. But at the point of purchase, it is a smaller problem for you than for the person you are bidding against.

The boundaries have never been confirmed

Many older Japanese properties have no confirmed survey against neighbouring plots. Resolving it requires every adjoining owner to agree and sign.

When this becomes a problem. When you sell — buyers and lenders want confirmed boundaries. When you build. When a neighbour disputes a wall.

What it costs. Several hundred thousand yen and several months, assuming the neighbours cooperate. If an adjoining owner has died and the estate is unregistered, considerably more of both.

Part of what you are buying is road

私道負担. A portion of the registered land is private road, often shared. You pay tax on it, you cannot build on it, and you may share maintenance obligations with neighbours you have never met.

Check the area figure. If the usable land is smaller than the registered land, the price per usable square metre is higher than it looks.

The title is not clean

Inherited property where the estate was never registered. Multiple heirs, some untraceable. A mortgage that was repaid but never discharged from the register.

Japan made inheritance registration compulsory in April 2024 partly to reduce this, but a large stock of unregistered estates remains.

The judicial scrivener will find these. That is what they are for.

Physical risks

It predates the seismic standard

Built before June 1981, and possibly before the 2000 revisions to wooden construction.

Legal, insurable, sellable. But it will behave differently in an earthquake, insurance costs more, some lenders decline, and every future buyer will ask.

Retrofitting is possible and often municipally subsidised.

Termites

This is one of the questions we are asked most, so it is worth answering properly.

Finding termites is not the problem. Shiroari are widespread in Japan, and in an old wooden house they are close to normal. A buyer who walks away at the word "termite" will walk away from a great many perfectly sound buildings.

The problem is what they have eaten. What matters is not whether insects are present but whether the structure has been compromised — the sill plate the house sits on, the posts carrying the load, the joints. A house can host termites for years with little structural consequence. Another can look untouched and have a sill plate you could put a finger through.

Treatment is a solved problem. Chemical treatment exists, it is routine, and it is not expensive relative to the purchase. Killing the insects is the easy half.

Assessment is the hard half, and it is where you should put the effort.

At a viewing, an agent can lift an access panel and look into the crawl space, and you should ask for this. It is worth doing and it will catch obvious damage. But understand its limits: you are seeing what is visible from one or two access points, not the condition of the whole frame.

For a house you are serious about, commission a professional inspector. They will assess the structural members properly and take moisture readings, which matter because damp timber is what attracts termites in the first place and because moisture content tells you about the condition of wood you cannot see.

The question to answer is not "are there termites." It is "what condition is the frame in." Get that answered and you can decide about the house.

The site is in a hazard zone

Landslide caution zones, flood depth zones, liquefaction risk. Every municipality publishes hazard maps. Almost no listing mentions them.

The Important Matters Explanation should cover designated hazard areas. Check yourself as well, before you offer.

It has been empty a long time

Damp, mould, rodents, a roof that has been leaking quietly for three years, pipes that have corroded from disuse.

A house empty for a decade is not a house that has been paused. It is a house that has been deteriorating without anyone watching.

Practical traps

The seller's belongings are still there

Extremely common with inherited property. Furniture, papers, a lifetime of possessions, sometimes a household shrine.

Somebody must clear it and somebody must pay. Agree this in writing before contract. A full house can cost several hundred thousand yen to empty, and disposal in Japan is not cheap.

The yield calculation assumed short-term letting

Covered in Chapter 11, and worth repeating here because it is the single most expensive mistake we see. Verify the zoning, the municipal ordinance, the building rules and the fire requirements at that specific address before you buy.

Process traps

You were not ready

The property you wanted sold to someone who had their funds arranged and their decisions made.

This is not a legal trap or a structural one. It is the most common reason foreign buyers end a year of searching with nothing, and Chapter 13 is about it.

You skipped the inspection to move faster

An inspection costs a fraction of one percent of the purchase price and is the only independent assessment you will get.

A closing note on risk

Reading this chapter, Japanese property can look like a minefield.

It is not. It is a market with well-documented, checkable characteristics, most of which are disclosed by law before you commit. Almost every item above is findable in advance by someone who knows to look.

The buyers who get hurt are not the ones who took a known risk. They are the ones who did not know there was anything to check.

Next: Chapter 13 — Taking the first step.