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Moving/Buying a House in Japan

AoiHana35

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Hi Everyone!

This is my first time here at the community. I've been trying to find some decent forums with people who've had years of experience in Japan.

Me and my Japanese wife who have been married for a while now have decided we'd really love to move to Japan. Her family member is going to sponsor my spouse-visa. I am a full-time software engineer and work from home full-time. I am allowed to work anywhere in the world I want and only need to be able to do virtual video conferences to sync with other developers and team members.

I make enough money to support ourselves and we have saved up enough to purchase a home in Japan.

Since I won't be making YEN, but USD, will this type of income be at all usable and proof of income to any Japanese banks for loans, financing etc or do I absolutely have to make YEN? We'll be of course converting my month salary into YEN from time to time, but there is no need for me to obtain a job with a Japanese company due to the stability in my company and working remotely so money is not an issue.

Thanks to anyone with some insight!
 

Majestic

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Hello AoiHana35,

I think you will find Japanese banks to be very inflexible with regard to getting home loan financing. The banks have a checklist of items they go through before they grant the loan, and anything that deviates from the checklist tends to get thrown into the "too hard" basket. A typical home loan in Japan will be a 30-35 year loan, so the bank will want to know:
1. Are you eligible to stay in Japan for that length of time (in other words, do you have Permanent Residency)?
2. Do you have a stable job in Japan?
3. Do you have income tax records in Japan to verify your income level?
Basically they want to know if you are a good credit risk, and these are the criteria they use to determine that. There are other things they look at as well, such as the home itself and its valuation.

I think you will have a difficult time to use your current income as basis for a home loan. Once you have lived here a while, and if that income stays stable while you are here, and if you build a history of making Japanese income tax payments, it might be feasible to use it in order to secure a home loan, but it will be outside of the normal scope of income sources, and that doesn't work in your favor.
 

Glenski

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How long have you been married?
How long did you reside in Japan, whether as a couple or single person?
As much as some married people with spousal visas have gotten bank loans, I have to agree with Majestic for the most part. Friends of mine who had spousal visas even for a few years were turned down despite living here for 5-10 years and having steady work. The bank said that permanent residence (as Majestic mentioned) would make them feel more comfortable in giving a loan.

Since you're probably going to come here without a house in hand anyway, keep these posts in mind and approach a bank as soon as you arrive. Do some homework first, though, so you aren't surprised at various aspects of buying a house, and so you know roughly where you want it.
 

Majestic

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Having said all of the above, I have heard that Tokyo Star Bank has been somewhat more foreigner-friendly than other banks. They may show slightly more flexibility than other banks... but this is just what I've read on this and other forums. And, this was before the housing crash of 2008.
 

Akakubisan

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Keep these posts in mind, but don't necessarily consider these the answer. Only a bank will tell you whether they will give you a mortgage or not.

Ex: I have a mortgage with SMBC that I started when married but still on a working visa. I had been here 4 years, working for 3.

The bank will need a story that they think merits there risk in giving you a mortgage, so some combination of visa, income, work, marital status, kids, in-laws, time in japan, language etc. I'm pretty sure they looked at it all, whether directly or implied.

Good Luck!
 

Lothor

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Some grounds for optimism: from what I have heard from an informal chat with a bank employee off duty, Japanese banks really really want to lend money at the moment. The number of people buying houses is historically very low (decreasing number of people in their 30s and 40s having families and people with stable jobs earning a reasonable amount), so I imagine there's some scope for flexibility.
Last year I got a 35 year mortgage at the age of 43 and I wasn't even asked to have a medical, which I was very surprised at. I do fit all the requirements mentioned above however.

Regarding banks, try approaching Shinsei bank, they are good with English documentation and English speaking staff, and seem to be more used to dealing with foreigners, suggesting that they will have a flexible approach. You also don't need a permanent residence either if I remember right. In the end we went with Mizuho for interest rate reasons, but I was impressed with Shinsei.
 

josharoo

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The good news is that there is deflation for Japanese houses now so it's becoming more affordable from that respect. I don't think you need to be earning or recieving yen, USD should be fine from what I understand
 

Lothor

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The good news is that there is deflation for Japanese houses now so it's becoming more affordable from that respect. I don't think you need to be earning or recieving yen, USD should be fine from what I understand
That's not quite true. Land prices increased fractionally in the big cities last year, and the cost of building new houses is increasing owing to the higher cost of materials and a labour shortage. What is more important is that there hasn't been a house price bubble for over 25 years, which has made property in Japan relatively affordable compared with many other large cities in developed countries.
 

cocoichi

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I make enough money to support ourselves and we have saved up enough to purchase a home in Japan.
Just to clarify this: Do you mean you have saved enough for a down payment, or to buy a house without a mortgage? And if you mean without a mortgage, do you mean a piece of land with a house to be added, or like a 20 year old pre-owned house? And in a larger city, or on the countryside?

I just want to understand your perception of "enough".

Last year I got a 35 year mortgage at the age of 43 and I wasn't even asked to have a medical, which I was very surprised at. I do fit all the requirements mentioned above however.
Don't know about other countries, but where I live the age to get a mortgage does not really matter. You are almost always required to get insurance for a certain percentage of the mortgage amount, in case you or your significant dies. That way the bank has the assurance a certain amount comes back, no matter what (and when sold, houses usually keep their value). How is that in Japan?
 

Glenski

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Why bother asking more questions? The OP posted once and then never came back. Drive by poster.
 

Lothor

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Don't know about other countries, but where I live the age to get a mortgage does not really matter. You are almost always required to get insurance for a certain percentage of the mortgage amount, in case you or your significant dies. That way the bank has the assurance a certain amount comes back, no matter what (and when sold, houses usually keep their value). How is that in Japan?
For the mortgage I applied for, the final repayment has to be before I am 80 and there was compulsory life insurance costing about 2.5% of the amount borrowed. In fact, the bank sends me a small repayment each time I make a voluntary additional payment because I need less life insurance.
 

Majestic

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Hello Lothor, that's a one-time payment of 2.5% of the borrowed amount stretched over the life of the loan?
 

Lothor

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Hello Lothor, that's a one-time payment of 2.5% of the borrowed amount stretched over the life of the loan?
Yes, actually between 2.5% and 3%, although it's going to turn out quite a lot less if I keep making early payments. Works out about 2,000 yen a month over a 35 year mortgage, which seems like a good deal - if I get hit by a bus tomorrow, I know the wife and kids will have a rent/mortgage-free place to live.
 

cocoichi

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Yes, actually between 2.5% and 3%, although it's going to turn out quite a lot less if I keep making early payments. Works out about 2,000 yen a month over a 35 year mortgage, which seems like a good deal - if I get hit by a bus tomorrow, I know the wife and kids will have a rent/mortgage-free place to live.
Definitely a good deal, for which you should thank the good people of Japan. If econometrists have calculated that 3% of every mortgage is enough to cover for the situations where the bank needs to pay out/write off the debt, it probably means that very few people with mortgages die before its all been paid.

2000*12*35 = 840.000 yen. That's basically nothing for what it represents.
 
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