Future finance planning when buying a house in Tokyo

[truth239]

@kitty63 I'll add that 0.5% for interest rate is pretty high. Assuming your financial profile is decent, then 0.3% rates are widely available nowadays. Seen 0.28~0.29 as well.

 

[crosswalk1991]

@kitty63 Why wouldn't you look for older than 15 years old or just new building with plans etc?

 

[kitty63]

@crosswalk1991 I guess I would look at older ones as well. I think I need to increase the ratio of cost of land/building to break even earlier, so naturally would have to settle with something old. Not sure how it will fair in the future though.

 

[crosswalk1991]

@kitty63 Yeah exactly. The situation in Japan is different than in Europe or america.

I'm guessing new would be too expensive for the same area/surface as an older one?

 

[kitty63]

@crosswalk1991 I can see a difference of 10-15 million easily in older and new ones. I usually buy new things, but a house just seems too expensive here. I might still just end up buying a new one, and hope I live in it forever.

 

[crosswalk1991]

@kitty63 Yeah could be worth it if you can "plan" your house and change what you want before it's built. If you do plan to stay in the long run it could be convenient. Maybe it will have better sound proofing than the average house?

 

[tater27]

@kitty63 Can I ask what your initial criteria are for a house in Tokyo 'around 50-70 million'? Are they mostly 2DLK or 3DLK? Avg sq ft/m?

I'm just curious because I'm looking at mostly 3DLK, and even 10 year+ old properties are more in the 90-120 million range. But my criteria might be a lot different! (i.e. specific neighborhoods, walking distance to a lively train station, etc.)

 

[kitty63]

@tater27 I'm looking for roughly 80-100 sq m land with 2 story construction. So roughly 125 sq m livable area, 3LDK with study maybe. Somewhere in east Tokyo.

 

[tater27]

@kitty63 Thanks! 115-130 sm is about the range I'm looking for as well. I'm looking mostly west of Tokyo.

 

[victoria37]

@tater27 90-120 million is not surprising with the criteria you have. 115-130 sqm is gigantic for a Tokyo house and western Tokyo - I'm assuming you mean Nakano/Suginami/Setagaya/Meguro - has always been the second-most expensive region after central Tokyo for a variety of reasons.

 

[tater27]

@victoria37 Yes, that corridor, lol. We have family there, so its our first choice.

 

[klonopin48]

@tater27 I believe it is not hard to find one that fit what you are looking for base on the requirements

 

[klonopin48]

@victoria37 nakano and suginami would more affordable compare to setagaya and meguro too.

 

[klonopin48]

@kitty63 with the condition plus the budget it could be quite further away from central tokyo

hope it doesnt make your commute time harder.

sumida or edogawa would do.

In case you need help find the property

 

[raspberryrain]

@kitty63 Would you be financing alone, or split with a partner? Tax deduction can be better if you can both be repaying the loan as there are some ceilings on how much you get back

Also depending on if it’s a new build there are other kickbacks I think.

 

[ckell19]

@kitty63 Where are you planning on buying? Just curious because I spent 70m on my house in the suburbs.

 

[kitty63]

@ckell19 East Koto-ku, Edogawa-ku. It’s quite possible from what I see and have heard. I think the prices are lower than rest of Tokyo because it's in the flood zone.

 

[ckell19]

@kitty63 Look western if you're interested. My wife was very keen on not getting a home near rivers according to the hazard map.

We got a house in western Tokyo for 70m. Lots of land. But it is much further away for the commute to the main city.

I'd suggest places like musashi sakai of mitaka. Along chuo line. Even ogikubo or nerima if you're not picky with location.

 

[spamdetector]

@kitty63 I don't know about land value of 3.5% per year. Where I live, and it's few station away from shibuya, the land hasn't moved at all since the last 10-15 years.