Tenant Insurance and Restoration Fees in Japan ? Real Estate ...

Two of the most disputed fees when entering into a rental contract are insurance fees and cleaning fees. These fees are explained during the Explanation of Important Matters session; however, as time goes by, it is always good to review the finer details so you are aware what to look for when you wish to cancel your contract.

Insurance is mandatory by law and all tenants renting anything in Japan must have basic fire insurance. Where a residential rental property is concerned, the insurance cost can be anywhere from ?15,000 ? ?25,000 per each 2-year contract depending on which insurance company the property manager is using. Payment for this insurance is due at the signing of the lease (or lease extension) and is paid directly to the insurance company.

Tenant insurance is always by a third party insurance company and you should have sent to you a copy of the policy along with your signed contracts from the property manager after you move in. ?If this is not the case, then call your property manager to find out why,?as you are entitled to have this policy.

Next is the cleaning and restoration fees. For cleaning, the standard rate for residential locations is usually between ?1,000 to ?1,500 per square meter depending on the cleaning company used. Many times tenants think that if they scrub the apartment before handing back the keys, a cleaning fee won?t be necessary. Unfortunately this is not true and the property manager will order a professional cleaning anyway despite your best efforts. What I usually advise tenants to do is move their belongings out of the apartment but don?t worry too much about dust as the apartment is going to be cleaned anyway. Cleaning fees are usually deducted from your deposits.

The same is true for repairs and restoration. If you break a window in the unit, then the property manager will need to use an owner designated repair company. This is usually a clause in the property management contract between the owner and the company managing the property. When tenants attempt to use their own independent repair company, then usually the property management company will not allow it. However, this clause really depends on the contract between the owner and the property management company, so you should always ask anyway if you can obtain your own estimate for repairs. Who knows, they might approve.

In terms of ?normal? wear and tear, this is usually explained in the contract itself in terms of what is the tenant?s and what is the owner?s responsibility. This is on the page of the contract that indicates a graph sloping downwards over time. The downward slope means that as time goes by, more and more wear and tear becomes the owner?s responsibility and less the tenant?s.

Usually around that graph, there are details explaining what is whose responsibility. During your Explanation of Important Matters session, ask the agent reading the contract to you to explain in detail the contents of this section. If you cannot read Japanese, make sure to take notes during this section to refer to later when you want to cancel the lease. Don?t be afraid to press hard on the issue until you are satisfied with the answers.

These fees are usually a sticky issue depending on how well the details of this section were explained prior to signing the lease. Hopefully, the above sheds some light on the finer details. Be diligent but patient, as the agent is explaining the situation in the best way he can despite the language barrier.

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Source: http://www.realestate.co.jp/2013/03/12/tenant-insurance-and-restoration-fees/

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