Annals of cheap: 5manika.com

December 2nd, 2011 by Philip Brasor & Masako Tsubuku

Redecorate your one-room apartment in retro (read: cramped) style!

“Deflation” continues to be the word on everyone’s lips when they talk about Japan’s economic problems, but so far one area has resisted the price-reduction trend: apartment rents. That may be finally changing. According to a recent article in the Tokyo Shimbun, it is now possible to find a one-room apartment with bath and toilet in the 23 wards of Tokyo for less than ¥50,000 a month. Generally speaking, since the mid-’80s the only units in the center of the city that were less than ¥50,000 were those in old wooden apartment buildings with communal toilets and no bath, meaning you had to patronize the local sento (public bath). Tokyo Shimbun credits the rise of the Internet with the reduction in rent, since more real estate companies are publicizing properties on the net and, as a result, apartment-seekers have more of an opportunity to compare prices. Before the Internet, you had to basically visit every real estate office in the area where you wanted to live, which is a time-consuming endeavor.

One young entrepreneur, Kenji Yoshioka, is already profiting from the trend. A former employee for an investment fund who handled real estate, the 33-year-old set up a company called A Power Home last April and launched a website called Yachin Go-man-en Ika that advertises only apartments which are ¥50,000 a month or less. He was responding to the reality that younger full-time workers were less well off than their predecessors, who had bigger benefit packages, more assured salaries and, most importantly, the use of company housing. Young people wanted cheap apartments near their workplaces but didn’t want to give up basic amenities, like a private toilet and bath. Yoshioka decided to collect this information in one easy-to-navigate website. It was an immediate hit and in October he even set up his own real estate company.

In most cases, the cheap apartments that Yoshioka publicizes are “sleeping,” meaning that they’ve been vacant for some time. Normally when people go to realtors and specifically ask for apartments that are less than ¥50,000, the agents turn them away because the commission isn’t really worth the time and effort. Landlords, however, are desperate to rent such places and many have remodeled them to make them more attractive while keeping prices affordable, adding things like sound-proofing and even elevators. Many attempt to attract women tenants (who make up more than 50 percent of single apartment-seekers looking for cheaper units) by allowing pets. Tokyo Shimbun mentions a one-room apartment with a loft, kitchen, unit bath-with-toilet, and even a window only ten minutes walk from Itabashi Station that costs ¥48,000 a month. There are even some properties listed for as low as ¥30,000 that have baths and toilets.

According to the real estate research company Home’s, the average rent for a one-room apartment in Tokyo has decreased by 5.3 percent in the last year alone. In addition, security deposits on such units have decreased by 8 percent and gift money by 11 percent. Since the vacancy rate for apartments in general in Tokyo is more than 10 percent (undoubtedly higher for cheap one-rooms) it’s not likely that rents will go up in the near future.

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4 Responses

  1. Clever entrepreneur. The downward rent trend, and hopefully so for key-money, can only continue in Japan’s moribund economic and demographic situation. 50000yen for an apartment should be normal in Tokyo, given how poorly built and tiny so many are. After all, a ’1DK’ can be as small as 300 square feet and made of little more than concrete and pasteboard. Kanto needs to get away from two things that keep young renters in their parents’ homes: unreasonable key-money and unrefunded ‘security deposits’. Even those on a lower wage can put more than 50000yen into rent, but trying to save up 250000yen to put down on an apartment is a non-starter for many. Perhaps another clever entrepreneur could convince owners to take no money up-front, but tack an extra 10000yen onto each month. A small risk, but one that would pay itself off in just two years.

  2. Only fools accept the notion of “key-money” and of “non refundable security deposits”. Like so many things that are called tradition in this sometimes ridiculous country, they are nothing but outrages rip-offs.

    One should simply shout at the agent or owner, really insult that crook, make him lose face in front every bystander… and then walk off and seek elsewhere. It works wonderfully.

    I have done it several times and still, on the same day found a flat to rent without being cheated out of my money. If you accept something like this, you deserve to be ripped off.

    IT IS POSSIBLE!!

  3. Here are links to discussions about the key money and security deposit issues.

    http://catforehead.wordpress.com/2011/08/18/backlash/#more-607

    http://www.japantimes.co.jp/text/fs20110802ht.html

  4. The article states: „The COJ sees renewal fees as a bait-and-switch scheme: The landlord sets the monthly rent low in order to attract a tenant, and then makes up for it by demanding a renewal fee later.“

    Which is of course nonsense, as rents do not differ and are NOT cheaper, and:

    “The Supreme Court, however, found that a renewal fee is reasonable “unless it is too high in comparison with rent or rental agreement periods.””

    This is simply nothing but a comment on the obvious “quality” of the legal system in Japan, which we all have lots of opportunities to watch regularly on the TV news. Remembering that Japan still is more a less a relict from feudal times helps understand many things in this country…..

    As I wrote, the simply solution is to tell the landlord what to do with flat, and then search some more…. There ARE any amount of other flats out there.

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