Key money you never get back. A guarantor you can’t find. Listings that quietly reject you. Renting in Japan baffles newcomers — but almost every barrier has a logic behind it, and a way around it. Here’s the inside view from a Japanese person who has signed these leases many times.
Renting your first apartment in Japan is where the gap between “I love this country” and “this country was not built for me” hits hardest. The upfront costs are startling, the paperwork is dense, and some landlords will turn you away for being foreign. The barriers are real — I won’t pretend otherwise. But nearly every one of them has a reason behind it, and once you understand the reason, you can see the way through. Let me explain how it actually works, from the inside.
The upfront cost shock
Move-in costs in Japan routinely reach four to six months’ rent paid at once. This is a heavy burden even for Japanese people, not just foreigners. It breaks down roughly like this:
- Deposit (shikikin), 1–2 months — security against unpaid rent and end-of-tenancy restoration. Partially refundable.
- Agency fee (chukai tesuryo), 0.5–1 month + tax — the real estate agent’s commission.
- Guarantor company fee, 0.5–1 month initially — more on this below.
- Key money (reikin), 1–2 months — a “gift” to the landlord that you never get back.
That last one is the one foreigners find almost impossible to accept. So let me explain what it actually is.
Key money: a historical relic nobody can quite kill
Here’s the honest truth: most Japanese people also find reikin unreasonable. We pay it anyway, because the system leaves no choice. The way I’d put it is — it’s an irrational holdover from history that we’ve all silently agreed to keep paying.
Its origin goes back to the postwar housing shortage. When apartments were scarce, tenants would offer the landlord a genuine token of gratitude — “thank you for renting to me” — sometimes literally money wrapped as a gesture of goodwill, the way a parent entrusting a child to someone might. Over time that goodwill payment hardened into a fixed custom.
What’s strange is that housing is now oversupplied, and the original reason is gone — yet reikin persists. Why? Because it quietly serves two parties: for the landlord it functions as a kind of prepaid bonus on top of rent, and for the agent it works as an incentive to push the property. The custom survives because it benefits the people who run the market.
You’ll increasingly see “no reikin” (reikin zero) listings now. But be warned — there’s often a trick. The savings tend to reappear elsewhere: a higher cleaning fee on move-out, or rent set slightly above the local rate. The cost rarely just vanishes; it relocates.
The guarantor problem: solved, then reshaped
For a long time, the single biggest wall for foreigners was the guarantor — traditionally a Japanese relative with stable income who would take legal responsibility for your rent. Most foreigners simply don’t have one.
Here’s the modern reality: guarantor companies have largely taken over this role, and they’re now required (sometimes alongside a personal guarantor) in the large majority of rentals — eight or nine out of ten. For a fee, the company plays the guarantor role. This is good news: being rejected outright simply because you lack a Japanese guarantor is far less common than it used to be.
But the wall didn’t disappear — it moved. The new question is whether a given guarantor company will approve a foreigner. Their screening looks at things like whether you can communicate in Japanese, your status of residence, and the stability of your employment. So the barrier shifted from “do you have a guarantor?” to “will a guarantor company underwrite you?” — a smaller hurdle, but a real one.
“No foreigners” listings: real, and not only prejudice
Let’s be direct: “no foreigners” properties genuinely exist. It’s not rare to find a note in an agent’s listing system explicitly stating that foreign nationals aren’t accepted.
It’s easy to dismiss this as plain discrimination. But to actually get past it, it helps to understand the landlord’s reasoning — because Japan’s rental market is full of individual, often elderly landlords making risk-averse decisions. From their side, the fears are practical:
- Trouble from cultural differences. The most common complaints are about garbage rules (sorting, collection days), noise at night, or letting friends move in unofficially. When the landlord or management company can’t communicate with the tenant to resolve it, a small issue becomes unsolvable.
- The “midnight runner” fear — unrecoverable debt. This is the big one. A landlord’s worst case is a tenant who stops paying and leaves the country. Disposing of the abandoned furniture and collecting unpaid rent from overseas is effectively impossible. And crucially, Japanese law strongly protects tenants — a landlord can’t simply change the locks and clear out the belongings. They must go through court, and the process can mean months, even over a year, of lost rent with the unit unusable.
So the “no foreigners” wall is often less about animus and more about a landlord deciding that, faced with a language barrier they can’t bridge and a legal process that traps them, a blanket “no” feels safer. Understanding that is the first step to getting around it.
What Japanese people know that foreigners don’t
Japanese rentals carry unwritten rules that extend well beyond signing day:
- Renewal fee (koshin-ryo), ~1 month every 2 years. Many leases renew every two years, and you pay a fee to do so. Like reikin, this barely exists abroad, and newcomers are stunned: why pay extra just to keep living where I already live?
- Strict “restoration to original condition” (genjo kaifuku). On move-out, you’re obligated to return the unit to its move-in state. Normal aging (like sun-faded walls) is the landlord’s cost — but cigarette stains, screw holes in the wall, or kitchen grease get deducted from your deposit, often steeply.
- Extreme sensitivity to noise. Japanese wood and light-steel apartments have thin walls and floors. Running a washing machine or vacuum after 10pm, heavy footsteps, loud TV, or friends laughing late will get a warning slip dropped in your mailbox fast.
- Subletting is absolutely forbidden. Letting someone other than the lease-holder live there long-term — even a partner, friend, or relative — let alone running it as an Airbnb, is a serious violation that can mean immediate eviction.
The one piece of advice that matters most
If I could tell a foreigner only one thing about renting in Japan, it would be this:
Before you start hunting for a property, go first to a real estate agency that specializes in foreign tenants — or a foreigner-focused guarantor company.
Here’s why. If you walk into an ordinary neighborhood agency and find a place you love on a listing portal, you’ll often watch the agent phone the landlord and get told, right in front of you, “ah, a foreigner, that’s a bit…” — rejected on the spot, again and again. It’s emotionally exhausting.
Starting instead with a window that has deep experience accepting foreigners, knows how to negotiate with landlords, and partners with multilingual guarantor companies is — by far — the smartest, most certain route. It saves your time, your effort, and your sanity.
Practical next steps
Money is the other half of settling in. Paying that four-to-six-months deposit often means moving funds from abroad, and the difference between a good and bad international transfer method can be substantial on that size of payment. It’s worth sorting out how you’ll move money into Japan before the lease is signed, not after.
Frequently asked questions
What is key money (reikin) and do I have to pay it?
It’s a non-refundable “gift” to the landlord, a historical custom from the postwar housing shortage that has outlived its original purpose. It’s not universal — “no reikin” properties exist — but those often recover the cost elsewhere, through higher cleaning fees or rent.
Can a foreigner rent in Japan without a Japanese guarantor?
Usually yes. Guarantor companies now fill this role in the large majority of rentals. The remaining question is whether a given company will approve a foreign applicant, based on language, residence status, and job stability.
Are “no foreigners” apartments legal in Japan?
They exist and are common, often driven by landlords’ practical fears — communication barriers and the risk of unrecoverable unpaid rent if a tenant leaves the country, made worse by tenant-protective laws that slow eviction. Specialized agencies are the practical way around them.
Why do I have to pay a renewal fee just to stay?
The renewal fee (koshin-ryo), typically a month’s rent every two years, is another custom with little overseas equivalent. It’s a standard cost of many Japanese leases rather than a penalty.
This article reflects the personal experience and observations of the author, a Japanese person who has rented and moved many times in Japan. It is general information; rental practices and costs vary by region and change over time. Verify current terms with a licensed agent.