Costs associated with purchasing real estate
Brokerage fees, taxes, and registration fees
Easy-to-understand explanation
When purchasing real estate, many people regret it later when they only look at the property price and set a budget based on that alone, thinking, "It ended up costing more than I expected." In reality, in addition to the property price,Brokerage fees, taxes, registration fees, and other miscellaneous expensesThis will occur.
This page clearly explains the types and amounts of various expenses involved in purchasing real estate, as well as how to significantly reduce these expenses by utilizing private sales.
List of major expenses incurred when purchasing real estate
- Brokerage fee:If going through a real estate company, the fee is 3% + 60,000 yen (excluding tax) of the property price, and a maximum of 330,000 yen (including tax) for properties priced at 8 million yen or less.
- Registration license tax:Taxes related to the transfer of ownership registration: Approximately 1.5 to 21 TP3T of the assessed value of the fixed asset.
- Legal scrivener fees:The cost of requesting a name change procedure is approximately 30,000 to 100,000 yen.
- Real estate acquisition tax:A one-time tax incurred after acquisition: property tax assessment value of 3-4%
- Pro-rata settlement of property tax:Settle property taxes with the seller from the date of handover onward.
- Fire insurance premium:Varies depending on the insurance plan; annual cost starts from tens of thousands of yen.
- Loan-related expenses:Administrative fees and guarantee fees when obtaining a loan, etc.
*The total miscellaneous expenses are generally estimated to be around 500,000 to 101,000,000 yen of the property price. For a property priced at 10 million yen, miscellaneous expenses would amount to 500,000 to 1 million yen.
Detailed explanation of miscellaneous expenses
Cost 1| Brokerage fee
When purchasing a property through a real estate company,The buyer will also incur a brokerage fee.Many people believe that brokerage fees are paid by the seller, but in reality, they are collected from both the seller and the buyer.
Due to the legal revision in July 2024, the maximum brokerage fee for properties priced at 8 million yen or less is 330,000 yen (including tax). This often accounts for the largest portion of the miscellaneous expenses.Using private sales eliminates these costs entirely.
- Through a real estate company: Up to 330,000 yen (tax included, for properties under 8 million yen)
- Private sales (J Home 2 U): Completely free
Cost 2| Registration license tax and judicial scrivener fees
When you purchase real estate, you need to register the transfer of ownership (change of name).Registration license tax and legal scrivener feesIt will cost money.
Registration license tax is approximately 15,000 to 21,000 TP3T of the assessed value of the property, and legal scrivener fees are approximately 30,000 to 100,000 yen. These costs are the same whether you go through a real estate company or sell privately, but with J Home 2 U, a legal scrivener will support you with the name change, so you can proceed with the procedure with peace of mind.
Cost 3| Real Estate Acquisition Tax
A tax that is incurred only once after acquiring real estateReal estate acquisition taxYes. Property tax is levied at a rate of 3 to 4% of the assessed value, but tax reductions are applied if certain conditions are met.
You will receive a tax notice from the prefectural government approximately 6 months to 1.5 years after acquisition. It is important to include this in your budget when purchasing the property. Older properties tend to have lower fixed asset tax assessment values, so real estate acquisition tax also tends to be lower.
Cost 4| Pro-rata settlement of property tax
Property tax on real estate is levied on the owner as of January 1st each year. If a sale is completed in the middle of the year,The buyer pays the seller an amount equivalent to the property tax from the date of handover onwards.That's the general practice.
The amount varies depending on the property and the time of year, but it is important to confirm the settlement method with the seller in advance. The same settlement method applies to private sales as well.
Cost 5| Renovation and repair costs
When purchasing an older property, in addition to the property price,Renovation and repair costsThis may be necessary. However, this is not a mandatory fee, and it will not be charged if you use the product as is.
Renovation costs vary greatly depending on the scale of the project, but having an estimate before purchasing the property makes it easier to plan your overall budget. If you choose to do it yourself, you can significantly reduce costs by only paying for materials.
Real Estate Agency vs. Private Sale: Comparison of Costs
| expense item | via real estate company | Private sales (J Home 2 U) |
|---|---|---|
| Brokerage fee | Up to 330,000 yen (tax included) | Completely free |
| Registration license tax | 1.5 to 2% of the assessed value of fixed assets | same |
| Legal scrivener fees | Approximately 30,000 to 100,000 yen | Approximately 30,000 to 100,000 yen(Supported by J Home 2 U) |
| Real estate acquisition tax | Property tax assessment value 3-4% | same |
| Property tax settlement | Daily pro-rata settlement | same |
| Total estimate | Property price ranges from 5 to 101 TP3T | Save on brokerage fees |
You can save a lot of money on various fees by buying and selling privately.
The brokerage fee, which accounts for the largest portion of the various costs involved in purchasing real estate, can be completely eliminated by using private sales.By using the money saved on brokerage fees for renovations or living expenses, you can make a smarter real estate purchase.At J Home 2 U, you can conduct transactions with the same level of security as going through a real estate company, with support from licensed real estate agents for contract preparation and handling of name changes by judicial scriveners.