Pulse Rate: ‘Free rent’ pricing aims to fill up empty apartments

June 12th, 2010 by Daniel Morales

Summer heat doesn’t just slow down pedestrians in Japan – it also stifles the real estate industry. Most of this is due to the Japanese employment/academic calendar, which begins in April every year and ends the following March. Between February and April, students move closer to the schools where they will matriculate, and new company employees move out of the house and start life as a shakaijin (社会人, working adult).

As covered on the June 11 broadcast of “Gacchiri Academy,” a weekly info-variety program on TBS about saving money, once everyone gets settled, real estate agents have to scramble to fill the empty rooms. They can’t lower rents because that causes current tenants to complain and also reduces the value of the property. In the absolute worst cases, rooms that don’t find tenants by the end of April remain empty for a full calendar year. In response, some real estate agents have started offering “free rent” (フリーレント) deals on certain rooms.

No, “free rent” does not imply totally free, but it does mean that the first two months are free. Additionally, many of these have no “key money” payment to the landlord, which can be as much as two months rent, and no introduction fee to the agency. The only thing required is a month’s rent for deposit. The goal of the “free rent” discount is to get bodies into the room so that the landlord can stop taking losses.

Shortly after the broadcast, the term “free rent” skyrocketed to the top of the Google Trends keyword searches. Clearly, there is a near-constant hunt for bargain living spaces in Japan. Japan Pulse has previously covered the boom in room sharing. Yen for Living has also covered room sharing as well as discounts on rooms where people have died. Gacchiri Academy suggested that a little negotiation might be a previously unconsidered tactic – real estate agents and landlords might be willing to offer the free rent policy for rooms that were previously not discounted.

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4 Responses

  1. I would be interested in leasing a room under these conditions, cheap fee, as i foreign student and tourist could i access to this kind of discounts too?
    From Mexico, greetings!!

  2. Unfortunately with most of these deals you have to sign a two year lease, so it isn’t ideal for tourists. It might work for a foreign student if you plan to be around for a while. Thanks for the comment!

  3. Hello Daniel,

    I thank you a lot for those very precious informations directly from Japan.

    I made a very short translation in french of your article, with a direct link to your original post.
    Visible at the following url : http://j.mp/9UFno9

    In case you don’t like or you don’t want this translation, I can delete my post.

    Best regards.

  4. Patrice – Thanks for the link and the translation! I wonder if this will happen in France and the US. I’m not too sure we’ll be lucky enough to get discounts.

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