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Renting

 

I will now explain why prices are so high in Tokyo.

It's been hard enough to find a place to live in Tokyo without any added difficulties: Discrimination against Foreignors, Refridgerator-Box-sized rooms, having to have a Guarantor, and Sky-high prices consisting of Rent, monthly Maintenace fees, one-time Apartment insurance fees, Gift money, Security Deposits, Realtor Fees, etc...

Keep in mind, none of these are rules have been created or are controlled by the Japanese goverment, but these are merely rules that developed over time by the greedy (yet smart) landowners in Japan. Landlords have come to expect all these extra payments and goodies and will just refuse to enter a contract that does not include them. In Tokyo, there is always another person who wants the same property :)

Discrimination against foreigners - half of this is due to basic xenophobia. On the other hand, many of the foreigners here are crass and rude (and not just Americans), are unaware of Japanese customs and ways of doing things, will destroy the places and expect a security deposit back, will skip town without paying final month's rent, etc. Maybe it stems from the fact that many foreigners feel that they're anonymous and since it's not their home, they don't care as much about the people or property? I really have no idea why. I guess a couple bad foreigners ruined it for the rest of us.

Refrigerator-box-sized apartments - I've seen homeless people in Philadelphia in larger cardboard refrigerator boxes than the apartments here. Things are small for what you pay. With the city so packed of buildings, no new land to build on, and the population in the city growing (although Japan's population in general is shrinking), everyone has to settle on a smaller slice to live in. Japan is an island, there is no new land to be found anywhere. With most apartments you get a room smaller than your college dorm room, but with a small bathroom attached. The bathroom's are wonders in themselves, as they are the size of a small walk in closet. They just have a small tub/shower, sink, and toilet - no vanity case or anything else. No cabinets. They are a single big slab of molded plastic with various holes for the various pipes to stick through and connect it to the the rest of the piping in the bulding. They are just plopped down right in part of the space allocated to the room. They are called 'unit bathrooms'. I had one once. You can get aprtments with normal, American-style bathrooms (just for more money). I will always opt to pay more rent to get a nice bathroom.

Guarantor - Every tenant must have a separate person who will gurantee payment for the life of the apartment lease (usually 2 years). This 'guarantor' must have a good job and undergo a credit check. Most Japanese use one of their parents. Foreignors usually pay extra for a separate company's service which acts as a guarantor or they just have their employer become the guarantor (which I have always done, except in one case where I rented from a real estate company here tailored to foreigners which just raised the monthly rents and removed the guarantor stipulation).

Sky High rents - The problem is salaries are about the same here as in the US (if not even a bit depressed in Japan). So, in terms of what people make versus what kind of apartment they will get, it is usually half the size from what they were getting the US. Furthermore, many people are coming from the suberbs in he US and are not even used to the prices of apartments in a large US city (better yet Tokyo). In an equivalent expensive part of a large city, rent prices are probably 2 times what they are in the US. Same goes for something in the suburbs here versus the suburbs of a large city in the US. Keep in mind Tokyo is larger than even the NY or LA so that's not even a fair comparison.

Monthly Maintenance fees - maybe in the US these are classified as Condo costs such as elevator maintanance fees, doorman fees, front lobby/door autolocks, and security systems, etc. Almost every apartment has 1 or more of these "luxaries" therefore has an extra 50-200$ added to the rent each month.

Apartment insurance fees - You are required to buy your own apartment insurance to protect against any natural damage to the unit (besides earthquakes - earthquake insurance is extremely expensive!). I don't really understand what it covers (my stuff or or the landlord's) and I've never had to use it. All I know is you have to sign up for it and it is about 200$ total, one-time fee for the 2 year leases you typically sign.

Gift money - This is the one thing for which there is no equivalent in the American system. I guess the cloest thing is a one time signing bonus in sports. Gift money is basically a one time (although it does recur every 2 years) payment (gift) to the landlord for letting you rent the apartment. It is almost always equal to 2 month's rent. You don't get it back. It's a damn nice 'gift'. It's sort of weird when you spend more on your landlord than parents, friends, and family combined for the holidays. Also, if you elect to stay in the apartment past the 2 year lease, you must pay another, single month's rent in gift money to the landlord.

Security Deposits - Usually 2 or 3 months rent. You will never get it all back. $300 is always taken out at the end for "cleaning fees", no matter how clean you left the apartment. More will be taken out, if they have to do anything other than basic cleaning (which could include replacing anything in the apartment, redoing wallpaper, fixing scuffs in the hardwood floors, etc). I have seen 4 and 5 months rent required in very new and expensive places (but of course never rented them). I have also seen places where only 1 month was required in old, hard to rent places. But, the usual is 2 months rent.

Realtor Fees - I guess this might occur in the US, but I think in the US most apapartments are rented by newspaper or magazine, etc. Here, there is nothing like that, and 95% of apartment's are rented via real estate agents. The usual way to do it is, decide on an area you like and want to rent at, take the train there some Saturday afternoon, then when you exit that local station, you will see many stores with apartment floorplans plastered all over their store front. Choose a store that looks nice or caters to foreigners or has some apartment floorplans that match what you are looking for. They will ask you what kind of apartment you are looking for and show a huge book of hundreds of apartments in the immediate area you can look at and rent. Decide on a few you want to see in person. They will call the oweners or the other real estate agents and get the key and find a day to show it to you. You can try to see 5 or 6 in a single day (hopefully the next saturday). Repeat until you find something you like. If you end of renting a place they showed you, you will have to pay them a fee equal to a month's rent in the new place.

2-Year Leases with an extra month's fee for going over - Since the moving costs associated with changing aprtments are so high to begin with, it is in the renter's interest to move as little as often. Moving every 2 years instead of every 1 can save you a lot of money. Therefore, most leases are of a 2 year length. However, to guarantee the landlord a fresh, new load of gift money, the contracts also states that if you do not move after 2 years, but wish to remain in the place, you must pay an extra month's rent to renew the lease. Obviously though, it is in the landlord's best interest to have you move out and get 2 months of gift money from a new tenant (instead of just the 1 additional month of gift money from you). They are ever so kind.

Having to "move-in" within a week - Essentially, you pay double rent for the time between moving. The fact is you have to give a month's notice when moving out. Inevitably, you end up paying for 2 apartments for 2 or 3 weeks.

Moving costs - no one has a car here and it's expensive to rent a truck for the day. It's easier to have people do it for you. $200 for a one room place.

I'm sure there's other things I'm forgetting, too.

Let me give you an example of the costs for just a $900 place (although $1300 would get you something closer to what you're used to existing in in America). First Month's rent: $900 2 month's gift money: $1800 (never to be seen again) 2 month's security deposit): $1800 (if apartment is returned clean you will get back all minus $300 = $1500) Realtor fee: $900 Insurance: $200 Rent from old place for the 2 weeks carryover: $450 Moving Van: $200

Rough Estimate of upfront costs (about 20% of which are recouped): $6200 (about 7 times the month rent!!)

All that is what makes this move so annoying. I had lots going for me this time: It's my 4th time going through this whole process in Japan so I know the whole process in and out and know how to get the best deals with the least amount of time and red tape, I had plenty of time to find a place and no deadlines - I could be picky and wait for the perfect place, Marie was helping me and will live there - this is a huge plus for dealing with Japanese landlords who discriminate against foreigners. Also, I have the backing of a huge, well-known, dependable firm to be my guarantor (Citigroup) and they will put the contract in their name (more trustworthy than an individual), I don't have to pay the 2 month's security deposit (thanks to Citigroup), I speak better Japanese now, I know Tokyo better, I'm aware of what I want and the tradeoffs I'll have to settle for, etc.

Marie and I had 4 different agents from different companies show us places. Of those 4, we settled on 2 who had better access to a wider range of more properties and those 2 seemed to be working a bit harder for us. Marie and I played good cop, bad cop with the real estate agents so we could see many places and turn them down without the real estate agents becoming discouraged.

All that, but, We were rejected twice. The agents did get discoraged and one finally did give up. But, the last one kept trying and wasn't about to quit. We finally settled on a place that we were accepted at. The reason we were rejected twice turned out to be Citigroup's policy (since the apartment will be in their name) that requires the apartment owners to expose various tax documents. The owners in our cases were private and didn't like the idea of turning over all of the tax documents documenting their wealth to a large bank like Citigroup. Sort of like when politcal candidates drop out of the race because they have to make all their finances visible. I don't know if it's because of the owners are paranoid or because they really are skirting the law in some way, but I have heard this is a common ordeal. The place we finally were accepted at is not privately owned by a single person, but owned by a property managment company to generate income. They had no problem turning over all their 'secret' tax documents.

All in all we must have seen about 30 places.

Third times a charm. Next week, I describe what we decided on and where we are living now (we moved in a month ago).