For wealthy individuals overseas, Japanese real estate is no longer viewed as just a place to live, but rather as a stable, long-term asset worth holding. Nevertheless, not all properties will maintain their asset value over time.
This article outlines five essential conditions for successfully owning and preserving real estate in Japan as a valuable long-term asset.
■ Condition 1: Location — In Real Estate, Location Determines 90% of the Value）
Location is the most critical factor in real estate investment, both in Japan and globally.
If your goal is to hold a property as a long-term asset, being in a central area, near a station, and within a popular neighborhood is absolutely essential.
In Tokyo, the following areas are known for their stable demand and strong asset value:
- Minato Ward (Minami-Azabu, Moto-Azabu, Roppongi, Shirokane)
- Shibuya Ward (Hiroo, Daikanyama, Ebisu)
- Chiyoda Ward (Banchō, Kojimachi, Kanda)
- Chūō Ward (Ginza, Tsukiji, Nihonbashi)
These areas are more likely to benefit from redevelopment and large-scale urban projects, and they tend to have a lower risk of price depreciation.
■ Condition 2: Building Age and Construction — Prioritize Performance and Maintenance Over Age
A newer building is not equivalent to a safer one. In Japan, building codes underwent a major revision in 1981, and properties constructed after that comply with the new earthquake-resistant standards.
Properties built after 2000 are generally considered to offer more consistent construction quality, making them a strong choice for long-term asset ownership.
Even more important than age are the building’s structure and maintenance system:
- Is it built with reinforced concrete (RC) or steel-reinforced concrete (SRC)?
- Does it have a long-term maintenance plan in place?
- Is the property management association active and well-functioning?
When these conditions are met, even buildings that are 10 to 20 years old can retain high asset value over time.
■ Condition 3: Maintenance Quality — The Condition of Common Areas Directly Impacts Asset Value
Luxury apartments in Japan are known for their exceptionally high standards of cleanliness and property management, especially in shared areas.
When common areas such as the entrance, elevators, hallways, and garbage stations are consistently well-maintained, it enhances the property’s credibility as an asset and serves as a strong selling point in the future.
Key points to check include:
- Whether there is a full-time concierge service
- The presence of security cameras and a solid security system
- Cleaning and inspection frequency
- The status and management of the repair reserve fund
■ Condition 4: Market Liquidity — Will the Property Be Easy to Sell When You Want To?
An asset is only truly an asset if it can be converted into cash when needed.
Properties with strong market liquidity—those that attract buyers quickly—tend to share the following characteristics:
- Located in popular areas
- Have standard, resellable sizes (e.g. 40–80 m²)
- Appeal to both domestic and international buyers
- Are relatively new or well-maintained
In contrast, properties that are too large, have unusual layouts, or are too old may not be ideal for asset preservation.
■ Condition 5: Establish a Solid Tax and Management Structure
Real estate is an asset that incurs annual taxes simply by owning it.
If you plan to own property while living overseas, establishing the following support systems in advance is unignorable:
- Appoint a tax representative within Japan
- Contract an tax accountant for income tax filings and declarations
- Coordinate with a property management company for handling vacancies, maintenance, and repairs
Failing to set up these systems can result in tax issues and a decline in the property’s value over time.
■ Summary: Focus on What It Takes to Own, Not Just to Live
Japanese real estate is highly regarded globally as an excellent asset-holding option, thanks to its stable legal system and relatively low disaster risk.
Nevertheless, to truly elevate it into a valuable “asset,” a good location or selling price is far from enough—a comprehensive approach that includes ease of ownership, liquidity, and a solid management system is what you need to consider.
It’s not about buying to live—it’s about buying to own.
This is the kind of real estate strategy that today’s international high-net-worth individuals should embrace.