Between the aggressive estate tax and huge gap between average income and housing prices in Tokyo; I’m just genuinely curious how folks can afford to have their own home. Are people leveraging multi-generational mortgages?
https://www.reddit.com/r/japan/comments/wkmd3h/how_do_people_afford_houses_in_tokyo/
9 comments
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Have you actually looked into it? Housing in Tokyo is still affordable even if not ‘cheap’, depending on how big a home you need and the area. The monthly mortgage payments are not that bad on average.
There are more to Tokyo than the Yamanote line
Genuinely better bang for your buck in Tokyo than where I live in the US.
200k a year, house is 1.2mil
Equivalent at 70k = 490k
Actual average = 290k – 430k
And that’s for Tokyo metropolitan area, not surrounding wards (suburbs)
Also, mortgage interest rate is extremely low in Japan. Adjustable mortgage rate is around 1%, and fixed is 1.5%ish. If you borrow 4000万 (adjustable)、your monthly payment is probably 12~3万。
Yes, parents DO get a break on the gift tax (or eventually their inheritance tax) if they buy a house or apartment for their child or children.
I often show properties to prospective buyers and sometimes the parents will view it once and then their son or daughter (who will become the actual owner) will show up to view the house after that.
I don’t think it’s any different from London, New York, San Francisco etc. Not everyone lives in expensive places in the city. Those who can afford it do, those who can’t afford it or want bigger, places move further out. Even in the city, there are huge differences in prices depending on the age, distance from the station, floor etc of the place.
People get 30+ year loans at 0.5% interest and a deposit from the bank of mum and dad.