All Forum Posts by: Bill Baldwin

 I know a Really good one but he only speaks Japanese. I do know an English speaking one here, but he has a tendency to play it too safe not point out all your legal options when discussing strategies unless asked a question explicitly... so you need to do some homework first and he can be a good point of contact for what you can/can't do. Happy to put yourself or your friend in touch.

By the way my mom's from Medford!

As an American living in Tokyo who's been extremely active in the Japanese real estate market since diving in head first 4 years ago, I feel like I could write a book about my experiences... and yet I often feel like I'm still new to the game, and find myself learning something new everyday.

Long story short in REI in Japan:

Japan banks offer 100% LTV loans - including all closing fees, insurance, and taxes - for in excess of 30x your pre-tax annual salary at anywhwere from 1-4.5% over 23-40 years.

There are zero tenant issues in Japan. Zero. All tenans need either an individual or "guarantor company" to back them, who is legally responsible for rent if the tenant doesn't pay.

Property management companies are reliable, do everything for you, and charge less than 5% gross rents. Some are obvioisly better than others, but I've never heard of any screwing people as they can (I know this all too well) in the US, as many are run by larger Japanese companies.

Properties in Japan actually depreciate over time. The majority of the value of most properties however (generally 2/3rds on average) are in the value of the land, and not the building itself. Since the bubble crash 27 years ago land values have stayed mostly flat, with a bit of an uptick the past few years (conversation for a different time).

Tenants must pay 1 month rent to renew their contract every 2 years, however initial leasing fee can run you anywhere from 1-3 months rent, depending on location.

Japan population is slowly decreasing overall, so buying anywhere outside of a few major cities is a recipe for future disaster, no matter the caps they offer now.

Speaking of caps, Tokyo cap rates have been compressed pretty tight over the past 5 years. A few of the other major cities aren't far behind.

The entire closing process is crazy. There are generally no inspections, and no escrow. I actually am in the process of selling a property, and as the buyers just transferred 10 million yen (just under $100k) to my bank account for the down payment. But there's no "in contract" period and they're performing no inspections, and if they don't transfer me the agreed sales amount on the date we agreed to they have to pay me 20% of the sales price in cash and lose the deal (same goes for me if I pull outta the deal early). And yes I'm totally hoping they cancel and have to pay the 20%, but not counting on it.

Depreciation scheduled are dependent on the construction material of the building (concrete, brick, steel, wood, etc.) and the year build. 

The tax laws here are antiquated, and quite frankly a bit whacked, for lack of a better word. There are some massively exploitable loopholes, but also a few things you have to be extremely careful about.

I could go on and on but... happy to field any questions people may have!

Hey welcome Alan! There's a solid group of international investors here in Tokyo, some focused on Japan, some countries abroad, and some like myself both. We have a monthly meet up at Brewdog in Roppongi, feel free to message me or search these forums for details!

There are, although I think most of us are living in Tokyo! I know a few people who own properties in Kansai but they're all located in Tokyo as well. Are you more primary residence or larger multi unit building focused? Also any good easy to deal with local Kansai banks?

Will feel free to connect, I've been in Tokyo 12 years myself and always happy to talk shop with like minded investors.

Here I am saying I never go to the meetup anymore (the last couple I went to weren't great) but may possibly swing by at some point tomorrow if schedule allows.

Hey George welcome - I'm also in the same boat as an American invested both back home and in Japan. They both have their benefits, however if you're self employed you may not be able to take advantage of the top reason to invest in Japan, which is the insanely advantageous bank financing. 

My advice on investing back in the states is definitely make sure you have someone back there you fully trust (preferably with a stake in the properties success) before you do.

The Tokyo Brewdog monthly meetup can be a good place to get some details on what's out there but be wary of everything you are told as Ivery found a lot of info I was getting wasn't entirely complete and found myself discussing more in some other circles with friends and colleagues these days.

Happy to talk specifics sometime of you have questions. 

Hey Samuel I'm a foriegner working in Tokyo as well and have been investing in real estate both in Japan and the US for a few years now. Happy to meet up and share some of my experiences sometime... I'm still thankful for those who did the same for me when I started out!

Victoria I think you're overcomplicating things with the 7% interest clause. Maybe makes more sense if you just say give him a slightly higher cut (ex 60/40) and go from there? If this was a planned quick turnaround/flip then I'd say when you cash out you can first pay him back his initial investment from earnings then split the remaining proceeds 50/50, but doesn't work so well for a buy and hold.

Definitely go for it. I've picked up 3 multi-units in this manner and although they don't cash flow much over long term it's a lot of fun to watch the remaining principal on the loans slowly drop each month.

 Jeremy will you be in the greater Tokyo area? Hit me up when you arrive in Japan, I live out here and own properties both here and in the US I manage remotely and always love catching up with similar investors!