Child free couple long-term in Japan – is it viable not to buy a house?

25 comments

1. Also in a child-free marriage and about the same age. My husband and I have no plans to buy a house in any country, really. With kids it would make sense, but it just being us? Yeah, it sucks that we’re paying someone else’s mortgage, but like you said, the benefits far outweigh the downsides. We’re free to move anywhere in the world if we feel like it, we don’t have to worry about getting things fixed on our own, it’s more manageable for us, etc. 60,000 yen divided between two people seems like a major steal and I don’t really see how a house would beat that, especially if you don’t actively want or need it.

2. You will be able to rent for now, but what if you get older and are retired? Are you going to find an apartment that easily when you are say 76?
   Since you are in a smaller city, chances are small, but if housing goes up a lot (let’s say they build a huge factory nearby), rents could also go up a lot.
   If Japan ever gets into hyperinflation you may be left without assets if you keep everything in cash.
   I feel like in your situation what I would do is rent, but put the amount of money it would take to build a house into a real estate based investment. That way if the housing market goes crazy your investment will see the same returns. This will allow you to rent in any situation.

3. One problem with renting is that it can get difficult with age as landlords are less willing to rent to the elderly since you never know when they’ll die and leave a corpse only to be found when the scent spreads to other rooms. If you don’t ever have to move, then you may be fine, but if you find yourself apartment hunting in your 70s, things may be difficult. Of course the market landscape may look different at that time however.

4. You are forgetting one important factor. The older you get, the harder it will be for you to rent a new place. Many landlords will turn down an applicant who is retired and past 70 or 80 because people of that age never leave, but live as a tenant until they are moved to a nursing home. This is unpleasant for a landlord but also makes it harder to sell the property. Investors will ask about the age of tenants when choosing an income property.

   So if you plan to jump from property to property to avoid deterioration, you may reach a limit.

   However, if you own something you can live there until death, and update whatever features you need to update, even adding specific features useful for the elderly, like handles in the bath. Renovations are tiresome, perhaps but property taxes are cheap. Indeed, buying a new house comes with income tax benefits.

   The secondary market in used houses is not that bad in most places. Especially if your house is unique in some way. If your local market is slow that may change by the time you want to sell.

5. A house is not a way to save money by any means, it’s a cost and a burden. Specially if your company subsidizes your rent, which is always more money than you’d get from the tax discounts for paying a house loan.

   The question is, do you want a house and is the extra cost associated with it worth it?

   To me it is, because I want to modify my own house, make holes in the walls, change floors and wallpapers, have a garage with tools, etc. If I didn’t care for that, I’d rather rent forever and save the money to go to a nice retirement home when I get old.

6. I have a house, child free because we didn’t want to always rent. Nice to own a place outright when you’re older. Or will you always have income for rent money m?

7. I think this really depends on you.

   I have a single friend who bought their own house and all, and pays something like 70,000 a year for taxes, or something like that. It’s a fair-sized place, too. If they wanted, they could raise a family there. They don’t want that.

   You buy the property. If the house there isn’t to your satisfaction, You have a house built that you want. That will suit the weather, that isn’t likely to shudder apart in a fair-sized quake. That the ground underneath is unlikely to turn to slush and drop your house downslope.

   If you want to aim to have something that you might someday sell for considerable profit, then you make it something like that.

8. You can, in general, get a bigger and nicer place in a similar or better location for a lower monthly cost if you get a decent mortgage rate. I’m in Tokyo, so this will likely be a different scale/market but my partner and I were in a slightly old (~20 years) but nice 3ldk in an okay location for 16man/mo. We were able to get a free standing house in a bit better of a location that’s a bit bigger, 10 years old, and has some custom interior for 8man/mo.

   The initial costs, getting the mortgage, house hunting, form signing, dealing with realtors, and being responsible for the place are all very valid worries and annoyances, but we researched well and bought in a place where the total cost of the house/lot will depreciate significantly less than average.

   We’re not going to get the same price we paid by the time we’d consider selling, but we’ll get a significant percentage and it seems really likely that we’ll come out ahead after 5 years compared to paying rent on a similar quality range apartment.

   It’s worth it if you think you’re going to be in a single place long enough to pass the break even point from the initial costs and interest, but it does take research and the ability to get a good mortgage rate.

9. When your retired your mortgage will be paid off, whereas renting you’ll be paying monthly till the day you die. But yea I understand the point of not wanting to be tied down and wanting ability to move anytime u want

10. Renting is what my wife and I have decided on doing. It just makes more sense. Sure the ideal of owning my own place is nice, but not really necessary.

    My parents in law have been renting the same house my wife grew up in, and they still live there. Their landlord had just recently lowered their rent because he knows if they move out, that’s the house finished (it’s so old by now he wouldn’t find another tenant).

11. Yea viable. Why not. As long as you can afford rent.

    The more ¥ you have the more viable anything is

12. We are a child-free (gay) couple living long-term in a house. I’ll take this any day over renting an apartment. We have a lot more space here than we would have if we were living in an apartment, no one else living upstairs or on the other side of the wall, no landlord, and a garden that is great for our dogs.

    Owning a house or property is not a good investment, generally, and you do have the maintenance costs and taxes associated with owning a home. For us, though, it’s a much higher level of comfort, privacy, and freedom than renting an apartment.

    One perk is that we converted one room of our house into a home gym complete with a treadmill, a rower, a fitness bike, a universal gym, and a widescreen TV. Another perk is that when I bought an EV last year I was able to have a charging stand installed for it in our carport. Can’t do those things at an apartment.

13. Buy an apartment. Cheaper than rent, less expensive than a house you don’t need.

    I got mine newly refurbished for a great price.

14. Depends on if you want the flexibility of renting, a permanent house is definitely less flexible.

    One likely benefit of buying is that you’ll be rent free in old age, and with taxes being much lower than rent, it’s a much lower burden for you. If you have a decent location, you can also sell the place and have a chunk of money to find a smaller place (less restricted by the need to commute to work), or just use the capital to finance rent for a few decades.

    But that cushion for old age may not be a big priority for you, and in that case you might prefer to have the flexibility of renting. I don’t see anything wrong with that.

15. >the secondary housing market in Japan is next to nonexistent. You can sell the plot, but the building will get demolished, nobody wants a secondhand house

    A quick view of the used housing prices on the secondary market will show you this is not the case. Any plot of land with a house on it that is newer than 40 years old will have considerably more value than a plot of the same size in the same location without one, unless the house is a real dump.

    No they aren’t as desirable as new builds and no, they do not generally retain their value but there is absolutely a secondary market for houses.

16. It’s a simple cash flow problem. Spend x amount per month for 30 years. After 30 years you own….nothing and keep paying rent, literally for the rest of your life.

    Or, buy a house that at some point will be yours and you will always have a place to live.

    And generally, mortgage payments would be lower than your rent. That’s why landlords can own a property and get rental income that more than covers the mortgage.

17. You can keep renting if you like. My MIL and FIL did until just before he died at 70. He wanted her to have a place I guess.

    We rented for a long time, but landlords can be a PITA and there these stupid charges like a month’s rent for renewing your contract. 60K is very cheap btw. But keep in mind it is not really 60K because of the move in cost and the renewal fees.

    Anyway…regarding the value of houses, we live in a country that was absolutely traumatized by the RE bubble in the 90s. So everyone now thinks properties lose value. But there is a market for secondhand – and – in our neighborhood new houses comparable in size/structure/location to ours (we bought 10 years ago) are listing at 70m JPY while we paid 55m. So…I am not terribly worried.

18. Don’t you want to put things on the wall and make your own space truly yours?

    I dunno, that was the big appeal for me. Not everything is about money, it’s about having somewhere stable, safe and homely. I never felt that during renting, especially with the ridiculous renewal fees.

    I find 60k for a newly built 2LDK in “Kanto” to be somewhat suss. Unless you mean Gunma or Tochigi. Even my friend in the deepest parts of Saitama pays a lot more than that for something new and good quality.

19. does your wife just want the “status” of being a home owner? get a condo, or what folks call a “mansion” as those are easier to resell, if new. used can be a tough sell, especially outside of growing towns. but if you don’t plan of having kids that need to be educated, why root yourself to a ball and chain of paying back loans and property tax? sure, getting hit up every 2 years with 更新料 kinda sucks but what’s 2 months rent compared to paying anywhere between 80-120k Yen every month? you’re in your late 30s, and almost all home loans are 35 year loans, meaning you will no longer be of income earning age by the time the loan ends. you can speed up the process by eating into the principle, but depending on the loan, you’ll need to repay it in 1M Yen increments(Flat 35 loan)

    If I didn’t have kids, I’d float around wherever I fancy living.

20. Nice to see other childfree people on here. I can’t give advice on housing as a single who will never have enough to consider buying property in any country.

    But with regards to renting to older people, there are two apartment complexes in my area that were recently built specifically for people over 60. I think as our generation ages and looking at the trends in Japan, I believe there will be more housing, new housing, set aside for seniors.

21. Me and my wife are not Japanese and I plan to stay in Japan until I die. We just bought an apartment room.

    Depending on the amount and the loan duration, your monthly payment can be cheaper than your rent. If you plan for the next 50 years, Loaning for 35 years and pay only maintenance for the next 15 will definitely be cheaper than renting for 50 years.

    If you only look at 10 or 20 years then renting is going to be cheaper, but what happens after that 10/20 years?

    Rent will always be rising, at the very least according to every year’s inflation rate. If you buy a home, the loan interest rate might fluctuate but the price is pretty much set.

    The trigger that made us decided it is best to by a home now because the loan interest rate was cheap for me and my wife, so cheap that we get more from tax exemption (1% of remaining amount) than the interest rate (0.345% of the remaining amount), at least for the first 10 years. This has been changed to 0.7% this year so it might be different for others.

    However, 60k for 2 people in a new apartment sounds too good to be true. I am curious to how much a home costs in that neighborhood.

22. Other have touched on the age things so I’ll cover the finance side.

    Assuming you live there over 10 years, the same house(or as close as possible: same age, same floor space, land area, amenities, location etc) will be cheaper to buy after 5-10 years than to rent, unless something really weird is going on with the market where you live.

    The main advantage of renting is mobility. Being able to move with few ties can lead to career opportunities and and free you of financial risk. You can also move away from neighbor problems.

    The main advantages of ownership is it still being cheaper so long as you live there for enough time(5-10 years to cut even, and after that you’re just profiting, this includes all costs like interest, tax credits, repairs etc). You are free to modify the home as you see fit so you can do things like adding solar panels which can both save you money long term and be better for the environment. You can customize the home to meet your own needs, and needn’t deal with landlords, and if it’s a separate house have a good deal more privacy

    My personal experience is that I valued the freedom a lot more when I was younger but as I got older I got more keen on improving my living space and my partner in gardening so we did end up buying. In retrospect I wish I’d done it earlier as where I lived prices have gone up well over 50% in the last few years. I would also have been done with payments 10 years earlier.

    But it’s very hard to know what your plans will be in 10 years. Settling down now may be a gift of cash to the you of ten years later or a burden.

    Both renting and buying are very valid choices here. I think most people start to lean towards buying as they get older, so doing it earlier can be good for your long term finances but it can also be a burden to careers if being tied down to a house prevents you from taking an opportunity

23. which area is rent 60k?

    if you can pay off the house before retirement then it is good. as other said, ageism is real for new tenant. if you don’t move to new apartment I think I havent heard elderly being evicted due to age (yet).

    if you can pay off the house before retirement, it is less burden on your retirement (unless you have separate saving other than the pension payout from government).

24. > Am I missing anything here? Can you just comfortably live out your life here renting a place forever? Are there any traps or pitfalls anyone can think of?

    Many landlords will refuse to rent to those who are 60+ years of age. So you can move around freely until then, but you could find it a lot harder to do as you get older. You also can’t just “buy a house” on a 35 year loan at that age, so you can find yourself in quite a pickle without having a lot of great options.

    Beyond that it’s up to you to decide what you value. If being able to move around a lot is very important to you then renting might make sense. However there will come a time 15 to 20 years from now when even considering the building depreciation and not being in Tokyo, the cost of renting will exceed what you have paid to live in a house. At that point, you actually *are* losing money every month and you will continue to do so until you die.

    You can also make the depreciation thing work for you by buying somewhere that has already depreciated. It will be ~10 to ~15 years old but probably still nicer than the 2LDK rental place you are in now. You’ll still deal with some depreciation but no where near as much.

25. A few things to consider:

    Do you see a house as your home, or just an investment to which you have no emotional attachment?

    Even if the latter, buying still makes sense over renting a place, because what do you get at the end of your lease? Nothing. You haven’t built an equitable stake (unlike with buying a property) and you’re not selling it. All you can hope for is that your landlord will waive the cleaning fee.

    Related to that: there’s considerably more certainty and freedom with buying. Tenant protections are pretty meh in Japan, and it’s a kick in the ass to suddenly get notice that your lease is not being renewed or terminated early.

    There’s a lot fewer ways to jerk a homeowner around by comparison.

    Sort of a random one, but IIRC, you can’t put a rental unit up as collateral