When renting a property in Japan, tenants often encounter lease agreements and disclosure documents filled with specialized terminology and culturally specific language. Even foreign residents with advanced Japanese skills may find legal and industry-specific expressions difficult to fully comprehend.
Phrases such as “Security deposit is non-refundable,” “Tenant is responsible for restoration to original condition,” or “Renewal requires re-contracting” may appear in the lease. However, many tenants find themselves uncertain about the exact meaning—or worse, signing documents without full understanding.
This article aims to clearly explain the Japanese phrases that frequently cause confusion among foreign renters, based on real-world rental practices. It is designed to help deepen understanding before signing and minimize the risk of future disputes.
1. Security Deposit & Key Money
Meaning:
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Security Deposit: A sum of money paid upfront and held by the landlord during the lease. It is generally refundable upon move-out, although deductions may be made for unpaid rent or restoration costs.
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Key Money: A non-refundable payment made to the landlord as a gesture of appreciation for granting the lease.
Common Confusion:
A frequent misunderstanding arises when tenants expect the full refund of the security deposit, only to find that it has been partially withheld. Deductions for cleaning, damage, or unpaid rent are common and should be anticipated.
2. Non-Refundable Deduction（Shōkyaku）
Meaning:
“Shōkyaku” refers to a pre-designated portion of the security deposit that will not be refunded. For example, if a lease states “2 months’ deposit, 1 month non-refundable,” it means that one month’s worth of the deposit is automatically retained by the landlord.
Common Confusion:
Many tenants assume the entire deposit will be refunded, only to later discover the “shōkyaku” clause in the contract. To avoid misunderstandings, it is essential to clarify during signing whether any portion of the deposit is non-refundable.
3. Restoration Obligation
Meaning:
This refers to the tenant’s obligation to return the property to its original condition upon moving out. However, this does not include natural wear and tear resulting from normal use over time.
Common Confusion:
Tenants often mistakenly believe they are responsible for repairing everything. In reality, deterioration from ordinary daily living (such as faded wall paint) is not considered the tenant’s responsibility under Japanese rental law.
4. Renewal Fee
Meaning:
This is a fee charged when a tenant wishes to continue residing in the property after the lease term has ended. Typically, the amount is equivalent to one month’s rent.
Common Confusion:
Many tenants assume the lease will renew automatically and are surprised by the fee, especially if no changes are made to the agreement. However, if the contract states that a renewal fee is required, payment becomes a legal obligation under the lease terms.
5. Fixed-Term Lease Agreement
Meaning:
This is a rental contract that automatically terminates at the end of the agreed lease period. Unlike standard lease agreements, it does not renew automatically; tenants must apply for a new contract if they wish to stay longer.
Common Confusion:
Many tenants mistakenly believe they can remain in the property indefinitely, only to learn that renewal is not possible. It is crucial to check whether the lease is labeled “Fixed-Term Lease” (Teiki Shakkaku Keiyaku) at the beginning of the contract.
6. Contract Term / Notice of Termination
Meaning:
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Contract Term: The duration for which you are allowed to reside in the property (e.g., two years).
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Notice of Termination: A rule requiring tenants to inform the landlord a set number of days in advance before vacating the property.
Common Confusion:
Some tenants notify the landlord of their move-out at the last minute, only to be told, “Since you didn’t give one month’s notice, you must also pay next month’s rent.” It is essential to check the required notice period stated in the lease and provide move-out notice accordingly.
7. Re-Contracting
Meaning:
This refers to signing a new lease agreement after the expiration of a fixed-term lease. Unlike a standard renewal, re-contracting may involve a new screening process and changes to lease conditions.
Common Confusion:
Tenants may assume re-contracting is automatic, only to find that approval is not guaranteed or that the rent has increased. It is essential to confirm in advance whether re-contracting is possible and under what conditions.
8. Explanation of Important Matters
Meaning:
Before signing a lease, a licensed real estate professional is legally required to explain key contractual and property details to the tenant.
Common Confusion:
Some tenants report receiving documents without a proper explanation or struggling to understand the terminology. It is crucial to fully grasp the contents before signing. Having a trusted interpreter present during this process is also allowed and highly recommended.
9. Joint Guarantor
Meaning:
A joint guarantor is legally responsible for covering rent and other obligations if the tenant fails to fulfill them. The guarantor assumes the same level of legal responsibility as the tenant.
Common Confusion:
Some people mistakenly believe a guarantor serves a symbolic role. However, in Japan, the legal obligations of a guarantor are substantial, and the role should be accepted only with full understanding of the risks involved.
10. Administrative Fee / Contract Processing Fee
Meaning:
This fee covers administrative tasks such as preparing the lease agreement and processing paperwork by the property management company. It is often charged separately from the broker’s commission.
Common Confusion:
Tenants may encounter unfamiliar charges listed in the initial cost breakdown and be unsure what they represent. It is essential to confirm the purpose of each fee in advance to ensure full transparency before payment.
Always Clarify Unfamiliar Terms at the Time of Signing
Japanese lease agreements can be complex—especially for non-native speakers—and misunderstandings may lead to serious complications. It is essential to avoid signing anything you do not fully understand. Don’t hesitate to ask for clarification, request a professional interpreter, or ask for repeated explanations of key terms.
A lease is built on mutual trust, and understanding every detail before signing is the foundation of a safe and secure living experience.