Transaction Type -Transaction Type

Transaction Type（取引態様）is a term used to describe the role and position of agents or representatives in real estate transactions. It clarifies the role of the agent in property sales or rental agreements. For example, agents might act as representatives for the seller or buyer, or they might handle the brokerage of the transaction. Understanding transaction type helps to better grasp the contract details and responsibilities. Agents are required to explain the transaction type to ensure transparency for their clients.

Registered Seal, Bank Seal & Informal Seal -Registered Seal, Bank Seal & Informal Seal

Registered Seal（実印）is a formal seal used on legal documents and requires government registration. It is typically used for real estate transactions or important contracts. Bank Seal（銀行印）is used for transactions with banks and must be registered with the bank. It is used for activities such as withdrawing money or transferring funds. Informal Seal（認印）is used for general documents or daily use and does not require registration. It is used for less formal documents like contracts or application forms.

Down Payment -Down Payment

Down Payment（頭金）is the amount you need to pay yourself when buying property, after subtracting the mortgage loan amount from the total price. For example, if you are buying a property worth 40 million yen and taking out a loan of 35 million yen, your down payment would be 5 million yen. In other words, it is the portion of the property price covered by your own funds or other sources, rather than the mortgage. This payment is usually made between signing the purchase contract and the final transfer of the property.

Fixed-term Rental Contract -Fixed-term Rental Contract

Fixed-term Rental Contract（定期借家契約）is one where the rental period is set in advance and the contract does not automatically renew when the period ends. Unlike regular rental agreements, once the term is over, it does not automatically continue. If you want to extend the lease, a new contract must be signed. Landlords can manage their property more flexibly according to future plans, and tenants can meet their short-term housing needs.

Dual Agency -Dual Agency

In property transactions or rental agreements, it is common to charge a fee to both parties involved, called Dual Agency（両手）. On the other hand, One-sided Agency（片手）means the fee is only charged to one side, such as just the buyer or the tenant, while the other party does not pay any fees.

Explanation of Important Matters -Explanation of Important Matters

In real estate transactions, according to Article 35 of the Real Estate Brokerage Act, agents are required to prepare and explain a document called Explanation of Important Matters（重要事項説明書）to the buyer or renter before signing the contract. This includes details about property registration, building restrictions, water and drainage systems, and whether the property is in a hazard zone.

Owner Change -Owner Change

Owner Change（オーナーチェンジ）refers to when the owner of a rental property sells the property with tenants still living in it. This approach is convenient for buyers because they don’t have to find tenants themselves, and they can start earning income right after the purchase.

tetsukekin -Deposit Payment

Deposit Payment（手付金） is the money paid when signing a purchase contract, intended to stabilize the legal relationship and secure the contract. Paying deposit payment helps ensure the commitment between both the buyer and the seller. Although the maximum deposit payment is typically set at 20% of the sale price, the usual range is between 5% and 10% of the total sale price.

Brokerage Fee -Brokerage Fee

Brokerage Fee（仲介手数料）refers to the fee paid to the real estate or broker that helps you through the process of finding a property and finalizing a deal. Whether it is for renting or buying, the real estate company supports the client by searching for properties and facilitating the agreement between the client and the landlord.

In the case of sales
2 million yen or less Sale amount x 5% x Consumption tax
2~4 million yen Sale amount x 4% + 20,000 yen x Consumption tax
Over 4 million yen Sale amount x 3% + 60,000 yen x Consumption tax

In the case of rentals
For rental agreements, the brokerage fee is determined based on the rent amount. Typically, real estate agencies specify the fee as a percentage of the rent, such as “〇% of the rent,” meaning the fee will vary with the rent amount.

Boundary Line Map -Boundary Line Map

Boundary Line Map（土地境界図）shows the borders of a specific piece of land. This map is used to clearly define the boundaries between the landowner’s property and neighboring properties. Knowing the exact borders is essential when selling land, dividing it, or planning a building project. Usually, a surveyor makes this map after measuring the land, helping to prevent future disputes. This map is an important document in real estate transactions and land development.

Surface Right -Surface Right

Surface Right（地上権）refers to the right to own and use buildings or other structures on land owned by a third party. This right is known as real right（物権）. Having this right means you generally do not need the landlord’s approval to use or manage the land.

Land Lease Right -Land Lease Right

Land Lease Right（土地貸借権）is a right related to the use of someone else’s land, classified as a contractual right. Unlike real right（物権）, a contractual right can only be used between the parties involved in the agreement, and the right holder cannot freely transfer or manage it without the other party’s approvement.

Leasehold Right -Leasehold Right

Leasehold Right（借地権）refers to the right to rent or lease land for the purpose of owning a building on it. In this case, the building is owned by the building owner, while the land is owned by the landowner. The building owner is required to pay a land lease fee to the landowner, who holds the ownership of the land.

Cadastral Map -Cadastral Map

Cadastral Map（公図）shows details like the shape of the land, divisions, land numbers, roads, and waterways. By using this map, you can easily see the borders and how they relate to neighboring properties. The map is managed by the Legal Affairs Bureau, and anyone can obtain a copy by paying a fee.

Registered Area -Registered Area

The area listed in land registries is known as Registered Area（公簿面積）. This differs from Surveyed Area（実測面積）, which is obtained through physical measurement. In real estate transactions, there are two main methods: Registered Area Sale（公簿売買）, which the price is based on the recorded area without considering actual measurements, and Surveyed Area Sale（実測売買）, which the price is based on the actual measured area,

Residencial Address Indication -Residencial Address Indication

According to the address system laws in Japan, Residencial Address Indication（住居表示）is a address different from land number（地番）and it is easier to understand. Each city or town decides on the address format, which includes the neighborhood name, block number, and house number for buildings.

Land Number -Land Number

A Land Number（地番）, is a unique code used to identify specific pieces of land. It is listed in the land registry and helps confirm ownership and rights. Each land parcel, called “a piece（一筆）”, has its own land number, but only registered land will have one.

Total Floor Area -Total Floor Area

Total Floor Area（延床面積）, the sum of the floor areas of all its levels, which indicates the size of the living space and is also known as the building area. This measurement is used as a standard for building permits, registrations, sales, and demolitions.

Registration of Transfer -Registration of Transfer

Registration of Transfer（移転登記）refers to the process of recording the transfer of a right (such as ownership or mortgage) from one person to another. The reasons for transfer includes buying, gifting, or inheriting. This type of registration applies to all rights that can be officially recorded.

Flag Lot -Flag Lot

Flag Lot（旗竿地）refers to a piece of land with a narrow frontage facing the road and a wider area of land set back from the street. On a map, it resembles a flag on a land, which is how it got its name.

Vacant Land -Vacant Land

Vacant Land（更地）refers to a land without any buildings and free from rights like leasehold or mortgage. It is typically land where you can build a home without restrictions. However, farmland that has not been cultivated or forest without trees is not considered Vacant Land（更地）.

Land Category -Land Category

Land Category（地目）refers to the intended use of the land, which is divided into 23 categories based on its condition and purpose. Each land has a specific category, which is recorded in the title section of the land registration document, typically noted after the location and land number.

City Renewal Act -City Renewal Act

City Renewal Act（都市再開発法）is a law aimed at promoting urban redevelopment in Japan. It focuses on improving old buildings and infrastructure, making better use of land, and enhancing urban functions. The law sets guidelines to ensure that redevelopment projects proceed smoothly. These projects often include the construction of commercial facilities, housing, and office buildings, with the goal of revitalizing areas and improving living conditions. The law also encourages collaboration between landowners, developers, and local authorities to ensure efficient project implementation. It plays a key role in supporting the sustainable development of cities.

Fire Prevention District -Fire Prevention District

Fire Prevention Districts（防火地域）are designated to prevent the spread of fire. In these areas, buildings must use highly fire-resistant materials and structures. Strict fire safety standards apply to both new constructions and renovations, aiming to minimize fire risks. Quasi-fire Prevention Districts（準防火地域）, have less strict rules but still require some fire safety measures, like using fire-resistant materials and following specific regulations, to keep the area safer.

City Planning Act -City Planning Act

City Planning Act（都市計画法）in Japan aims to support the healthy growth of cities and organize how land is used. It helps plan urban development in an orderly way, improving living conditions and providing public facilities. The law makes rules for what land can be used for, how tall buildings can be, and how properties can be used, preventing uncontrolled development and keeping cities pleasant. In real estate transactions, the property’s zoning designation and building conditions are determined based on this law.

Building Standards Act -Building Standards Act

Building Standards Act（建築基準法）is a law established to ensure buildings in Japan are constructed safely. It outlines standards for building structures, earthquake resistance, fire safety, ventilation, and lighting to ensure buildings provide a safe and comfortable space for people. For example, it includes rules about building height, distance from property boundaries, and evacuation routes to ensure urban planning and resident safety. When constructing or renovating a building, it must follow with the design and construction guidelines set by this law.

Real Estate Transaction Business Act -Real Estate Transaction Business Act

Real Estate Transaction Business Act（宅地建物取引業法）is a law that regulates the business of real estate transactions, enacted in 1952. It primarily focuses on a system that requires real estate agents to be licensed, the real estate transaction agent system, and the business guarantee fund system. Additionally, it ensures that there are clear guidelines for what is prohibited and what must be followed in real estate transactions. The goal is to maintain fairness in real estate dealings and promote the healthy development of the industry.

Management Contract -Management Contract

Management Contract（管理受託）means that property owners hire a professional management company or manager to handle the property instead of doing it themselves. This lets experts take care of things like maintaining the property, managing rentals, and dealing with tenants. It usually includes tasks such as regular property checks, repairs, collecting rent, and responding to tenant questions. Property owners pay a fee to the management company and it helps keep things running smoothly.

Building Management -Building Management

Building Management（ビルマネジメント/BM）refers to the specialized service of managing and operating buildings or commercial facilities. This includes maintaining the building, inspecting and repairing equipment, cleaning, managing security, and handling tenant issues. BM plays an important role in preserving the value of the property and ensuring efficient operation. It also involves managing lease agreements, collecting rent, and suggesting improvements to the facility. Through BM, the safety and comfort of the building are enhanced, leading to long-term stable operations.

Property Management -Property Management

Property Management （プロパティマネジメント/PM） involves the comprehensive management of real estate rentals, aiming to maximize property revenue while ensuring reliable service for tenants. Effective management and operations are geared towards enhancing the asset value of the real estate. PM encompasses a diverse range of responsibilities, including tenant recruitment, rent management, lease execution, problem resolution, financial management, and project management. It involves strategic planning for leasing and marketing, maintaining a balance between tenant satisfaction and property profitability.

Master Lease -Master Lease

Master Lease（マスターリース）refers to a rental arrangement where a party leases an entire property and then subleases it to other individuals or businesses. For example, a property management company might lease an entire building from the owner and then rent out individual floors or units to different tenants. This arrangement allows the property owner to receive a stable rental income, while the management company handles all tenant agreements and property management. It aims to provide efficient management and steady income.

Repair Reserve Fund Fees -Repair Reserve Fund Fees

Repair Reserve Fund Fees（修繕積立金） is a long-term reserve set aside to cover the costs of maintaining and repairing buildings, like apartments or condominiums. It ensures there are funds available when large-scale repairs or maintenance due to aging are needed. Each owner contributes a fixed monthly amount to this fund, and the amount can vary depending on the property and management association. This fund is essential for maintaining the long-term value and safety of the building.

Gross Yield ＆ Net Yield -Gross Yield ＆ Net Yield

Gross Yield（表面利回り/グロス）measures the rental income of a property as a percentage of its price over a year, giving an idea of the investment return. Net Yield（実質利回り/ネット・NOI）, on the other hand, accounts for additional costs like purchase expenses and annual maintenance fees, providing a more accurate assessment of the investment’s profitability.

Sublease -Sublease

Sublease（サブリース）is a kind of rental management method where a property owner leases their property to a subleasing company, which then rents it out to tenants. With this arrangement, the subleasing company usually offers rent and payment default guarantees, allowing the property owner to avoid the hassle of managing the property and still earn a relatively stable income.

Fixed Asset Tax -Fixed Asset Tax

Every January 1st, people who own land, buildings, or depreciable assets must pay a tax based on the value of these assets. This tax is called Fixed Asset Tax（固定資産税）, which is paid to the municipality where the assets are located.

Real Estate Acquisition Tax -Real Estate Acquisition Tax

When you acquire property like land or buildings in Japan, Real Estate Acquisition Tax（不動産取得税）is charged by the local prefecture. This applies when you purchase, exchange, receive, or build new property. The tax amount is usually based on the value of the property, which is calculated using the fixed asset valuation. For residential properties, there may be some reductions. After the property is obtained, the local government will send a notice with the tax amount. Typically, the tax is paid in full, but in some cases, it can be paid in installments.

Property Registration and License Tax -Property Registration and License Tax

When buying property or setting up a mortgage, Property Registration and License Tax（登録免許税）is charged during the property registration process. This tax is paid to make sure your ownership or mortgage rights are legally protected. The amount depends on the property’s value and type, and it’s usually based on the assessed value used for property taxes. In some cases, such as applying for a mortgage tax deduction, there may be tax reduction measures.

Stamp Tax Fee -Stamp Tax Fee

Stamp Tax Fee（印紙税）applies to specific documents, such as real estate purchase agreements or rental contracts. The amount of tax depends on the value written in the contract, and you pay it by attaching a stamp to the document. In real estate transactions, this tax amount varies based on the contract details, making it an important part of the process.

Corporate Tax -Corporate Tax

In Japan, companies and organizations are required to pay Corporate Tax（法人税）on their income. In real estate transactions, corporations are also required to pay corporate tax when buying or selling properties. The tax is calculated based on the company’s earnings, so the more profit a business makes, the more tax it has to pay. This tax is paid to the national government and is an important part of the financial responsibilities for companies in Japan. Additionally, it may change with tax reforms.

City Planning Tax -City Planning Tax

In areas designated for urban development, people who own land or buildings are required to pay City Planning Tax（都市計画税）. This tax is used to fund public infrastructure like roads and parks and support the organized growth of cities. It applies to land and buildings that are subject to property tax, and the amount is determined based on their assessed value. The tax rate varies by municipality, but it is generally set at 0.3% or lower of the assessed value. It plays an important role in funding local infrastructure improvements.

Property Description Sheet -Property Description Sheet

Property Description Sheet（マイソク）is a common advertising media in the real estate industry. It typically includes basic information about the property, floor plans, and contract details.