When renting a property in Japan, tenants are often required to pay a “shikikin” (security deposit). This deposit, typically equivalent to one to two months’ rent, serves as a safeguard to cover potential repair costs when vacating the property.

However, many tenants are surprised to find that the deposit is not fully refunded upon move-out. Complaints such as “I expected to get the full amount back, but didn’t,” or “Deductions were made without clear explanation,” are not uncommon.

This article explores the common reasons why a security deposit might not be returned in full. It also provides practical strategies to help tenants avoid disputes—before signing the lease, during the tenancy, and at the time of departure.

What Is a Security Deposit

In Japan, a shikikin is essentially a security deposit paid by the tenant to the landlord. It is typically used for the following purposes:

• Restoration of the property to its original condition upon move-out (including repairs and cleaning)

• Settlement of any unpaid or overdue rent

• Coverage of other contractual expenses (e.g., key replacement)

While the general premise is that any unused portion should be refunded to the tenant, in practice, it is quite common for only a partial refund—or none at all—to be returned.

Key Reasons Why Security Deposits May Not Be Fully Refunded

1. Deduction for Restoration Costs
   　Under Japanese lease agreements, tenants are typically required to restore the property to its original condition upon move-out. Restoration expenses are often deducted from the security deposit.

However, tenants are generally not responsible for:
　- Normal wear and tear (e.g., sun-fading or furniture marks)
　- Dirt or discoloration from regular daily living

Tenants may be held liable for:
　- Major wall damage or holes
　- Stains from spills or oil splashes
　- Odors or damage caused by pets

2. House Cleaning Fees Specified in the Lease
   　In recent years, many leases include a clause requiring a fixed cleaning fee upon move-out. These are considered separate from the security deposit and are non-refundable.

　Example:
　“If ¥33,000 will be deducted for professional cleaning upon departure” is clearly stated in the lease, it is considered legally valid.

3. Partial Non-Refund Due to “Shōkyaku” (Depreciation Clause)
   　Some agreements specify that a portion of the deposit is non-refundable from the outset. This is known as shōkyaku, or “non-refundable portion.”

　Example:
　If a deposit of two months’ rent includes one month as shōkyaku, only one month’s worth is refundable. This is viewed as a contractual agreement and is generally not subject to legal dispute after signing.

4. Outstanding Rent or Utility Charges
   　If any rent or utility bills (electricity, water, gas) remain unpaid at the time of move-out, landlords are permitted to deduct these from the security deposit.

Dispute Prevention Strategies: What to Do Before Signing the Lease

• Carefully Review the Lease Agreement, Especially the Special Clauses
  　Special clauses often contain critical details regarding deposit depreciation, cleaning fees, and move-out settlement procedures. Understanding these in advance can prevent misunderstandings later.

• Verify Compliance with National Restoration Guidelines
  　Confirm whether the property adheres to the Ministry of Land, Infrastructure, Transport and Tourism’s official guidelines. This helps reduce the risk of excessive or unreasonable deductions.

• Clarify Security Deposit Terms with the Real Estate Agent
  　Discuss the exact conditions under which the deposit will be refunded. Establishing clarity from the outset can avoid future disputes and ensure mutual understanding.

Dispute Prevention Strategies: What to Do During Your Tenancy

• Take Measures to Prevent Damage to Walls and Floors
  　Use protective mats, felt pads, or area rugs to avoid scratches and scuffs, preserving the property’s condition throughout your stay.

• Document the Property’s Condition Upon Move-In
  　Photograph walls, floors, and fixtures immediately after moving in. This visual record can serve as vital evidence during the move-out inspection.

• Maintain Regular Cleaning of Wet Areas and the Kitchen
  　Mold, grease buildup, and other hygiene issues are often considered the tenant’s responsibility. Periodic cleaning can prevent such problems and potential deductions from your deposit.

Dispute Prevention Strategies: What to Do When Moving Out

• Be Present for the Final Inspection
  　Attend the move-out inspection in person to receive real-time explanations regarding any areas requiring repair. This promotes transparency and builds mutual understanding.

• Review the Estimate and Final Settlement Details Carefully
  　Check the breakdown of deductions from your security deposit. If anything is unclear, don’t hesitate to ask for clarification.

• Negotiate If You Disagree with the Charges
  　If you find any items questionable—especially repair costs—you have the right to discuss them with the property manager or landlord. Reasonable negotiation is entirely acceptable.

What to Do If a Refund Dispute Arises

If, despite your efforts, the refund process still feels unsatisfactory, consider the following steps:

• Consult a Consumer Affairs Center
  　These centers offer free advice and support. They can share precedents and provide practical guidance on how to resolve disputes.

• Use Official Real Estate Consultation Services
  　Governmental or municipal offices (including the Ministry of Land, Infrastructure, Transport and Tourism) offer expert advice and can review contract documents on your behalf.

• Consider a Small Claims Court Proceeding
  　If the disputed amount is under ¥600,000, you may initiate a small claims lawsuit at a summary court. This process is accessible even without legal representation.

In Conclusion: Security Deposit Refunds Are Protected by Preparation and Awareness

The primary reasons for unreimbursed deposits often lie in the lease agreement terms and the property’s condition at move-out. To avoid the disappointment of receiving less than expected, it’s essential to be diligent—review the contract beforehand, maintain the unit during your stay, and document everything upon departure.

In Japan, it is often said that “moving out is more important than moving in.” For this reason, never proceed with a lease while unclear about the terms regarding your deposit. Start your new chapter with full confidence and clarity.