Why rent when you can buy?

[Shouganai]

Just a recommendation for anyone who thinks they will be living a long time in Japan; whether because:
1. They have a good job
2. They love the place
3. They are married to, or intend to marry a Japanese partner

You might want to consider saving yourself a great deal of rent expense by buying a home. Google 'buying foreclosed property in Japan" for more info, but some basic advice:
1. The Japanese prefectural law courts are tendering the sale of discounted properties way below market prices
2. The yields on Japanese property can be so high that renting is crazy. For instance, I paid just Y2.8mil for a 5br dormitory on 400m2 of land at Hanno, west of Tokyo. Its just 1hour from Ikebukuro, and I always get a seat on the train (Y420). There are better properties for less in depopulated rural areas.
3. Buy a house & land in suburbs to avoid apartment management fees, which are usually a rip-off.
4. Buy an old house with land lease if you insist upon living in the central city areas because the land rent can be extraordinarily low.
5. If you intend to stay more than 4 years in Japan, it would make more sense to buy there; particularly if you are earning yen, as all the major currencies are being debased.

The appeal of foreclosed property is that its a huge market; the Japanese investor is generally ignorant and risk-averse. The educated elite in Japan are more interested in office and residential complexes, not in managing houses, so you are really competing against real estate agents and home handymen who have limited resources.

 

[Jerry Cullins]

So, are you one of the guy's with the website that will do all the legwork for someone (for a healthy fee of course)?

Or are you the guy trying to shill his book?

Just curious because almost all your posts seem to have to do with buying foreclosures but don't give any real details. Of course if someone knew what they were searching for finding sites like http://www.k81.jp and ホーム | BIT 不動産競売物件情報サイト would give them all the info they need to know. No need to buy a book or pay someone to do the legwork for you.

And I'm not saying don't buy foreclosures, just that you have to be careful because it's generally a nightmare in terms of repairs, money still owed (unpaid bills), bribing the occupants to get them out (why would they want to leave - Japanese courts were very tenant friendly?), and of course you can't just go in and junk the previous owners goods - expect to have to pay storage if you can't locate the owner and get a release to junk their old stuff while you follow the proper process to get rid of their junk. And lets not forget that you can't visit the property or look around inside - you're basically buying the property based on the pictures you see on the website.

 

[Shouganai]

I'm not saying don't buy foreclosures, just that you have to be careful because it's generally a nightmare in terms of repairs, money still owed (unpaid bills), bribing the occupants to get them out (why would they want to leave - Japanese courts were very tenant friendly?), and of course you can't just go in and junk the previous owners goods - expect to have to pay storage if you can't locate the owner and get a release to junk their old stuff while you follow the proper process to get rid of their junk. And lets not forget that you can't visit the property or look around inside - you're basically buying the property based on the pictures you see on the website.

Well, I don't think you can say much without a specific context. Anyway, I agree, those are the types of sites that I would go to as a start when looking for foreclosures in Japan. I personally have found that the court documents very fair in their description of the property. Of course there will be people promoting books, broking services. There will also be people wanting to discourage because they want to scare off competitors. At the end of the day, people have to do their own research. That's how I learned. Of course people can approach these risks totally blind, or they can research and think. So its not just pictures...pictures tell you a thousand words if you analyse them. I bought my place for Y2.8mil and learned a lot in the process. A 2nd place we bought was Y3.8mil. It was good enough to rent for a 13% yield (ungeared). Compare that to a Y15-30mil house. Sure there are qualitative differences, i.e. age of house, but it makes a lot of sense when people discount the value of foreclosures. That property was bought from a bureaucrat. He even offered advice on how to care for the property. They are not all tortured alcoholics, and the condition of the property tends to reflect their personal state of mind. The bidding documentation is pretty detailed. There is no restraining order preventing you from looking at the property...of course there are trespass laws about entering it. But like I say, the court inspectors do a good job and the discount is hefty. Expect to get an old house for free. i.e. Buy the property for less than land value. i.e. I got my 18yo, 5br dormitory for Y2.8mil - the land would be worth Y4-5mil, and its next to a private school. Kind of cool purchase because it has independent electricity connections for each room, its a scenic area new Hanno. It does need some repair to the cladding inside and the plumbing. Costs me just Y30,000 a year for local taxes. There is a 80% subsidy to install a new septic in the area, however I'm a non-resident and its easier for me to pay the 'disgruntled neighbour' (forced seller) Y5,000 for water and septic services whilst I use his - when I holiday in Japan.

 

[Jerry Cullins]

Of course there will be people promoting books, broking services.

Hmm, amusing, you sidestepped the question. So, which are you, the book seller or the service broker?

And at 18 years old you'd better hope the land is worth more than you paid for it since the building is worth 0.

 

[Shouganai]

Hmm, amusing, you sidestepped the question. So, which are you, the book seller or the service broker?
And at 18 years old you'd better hope the land is worth more than you paid for it since the building is worth 0.

Amusing? Irrelevant.
I'm not promoting books or services. I believe that is contrary to the rules. In fact you promoted services above since those websites have advertising. I am educating people about foreclosures. In contrast, you are offering cynicism. I used to write posts about buying gold as an investor..now its so high, I don't even bother talking about that...even though gold is going to $2400/oz. Support around $1580/oz if I recall.
Ok to clarify....the building is nominally worth zero based on the price I paid, but to me its worth a few million in rent substitution. To place it in perspective, a builder/agent brought an older dormitory next to me and refurbished it for commercial reasons. My place is younger and a more quality construction, but I'm not so inclined to spend the money since I'm not a resident. I just like having a cheap place in a nice city.

 

[Jerry Cullins]

Really? Is this like one of those educational seminars they hold in big hotel meeting rooms where you come out, brag about how well you've done, then offer to sell the secret to this easy path to riches for a few thousand dollars?

Because that's what it sounds like. A lot of bragging and no meat to the "education". You're not telling people where to look, you're not telling people how to participate, you're not telling people how to get financing (opps, you can't until after you've bought and paid for the property), you're not giving people the information about getting rid of other peoples property inside the house, you're not giving them information about dealing with things like whether you actually own the access to your property or not and that you might have to go to court to get an agreeable "rent" on your driveway, you're not telling people the details about evicting people who might not want to leave their former home...

So the obvious conclusion is you're either lying or you're selling something. So which is it?

 

[Shouganai]

Really? Is this like one of those educational seminars they hold in big hotel meeting rooms where you come out, brag about how well you've done, then offer to sell the secret to this easy path to riches for a few thousand dollars?

Ok, you seem to know it all. Maybe too much considering your "negative experience". I had surprises, but for the two properties we got I think we got bargains. Keep talking....its important people know about the risks. I've mentioned them on previous occasions...so I won't repeat myself. But I wonder if you learned that information, and used it. Previous times people have criticised, but others cite positive results, and they actually seem to be the one's doing it. So I thus wonder if your intent is to discourage others and cast dispersions upon others who raise awareness.
Actually I was motivated by an article showing affordability index for Sydney at 11, Auckland at 9 from memory, and various in USA. Having said that there are plenty of US cities where you can buy cheap houses. But many people, including myself, like Japan, and that is the topic of the forum.
All I'm doing is raising awareness because there are people out there who will find out 4yrs too late that they could have bought a property below market price. Are there risks? Of course. But I'm not going to write a 100 page essay on them. I've said enough on previous posts. People can find those posts...why repeat them?

 

[Jerry Cullins]

Either you are lying and don't know the risks or you are selling something, which one is it buttercup?

 

[Shouganai]

Either you are lying and don't know the risks or you are selling something, which one is it buttercup?

I believe that is a false dichotomy.

 

[Jerry Cullins]

So enlighten us, are you lying or selling something?