Financing a Japan Property Purchase from Abroad

No Japanese mortgage: the purchase is in cash

Start with the most misunderstood point: a non-resident foreign investor cannot obtain a mortgage in Japan. Japanese banks reserve the home loan jutaku loan (jūtaku loan, home loan) for people resident AND salaried in Japan, with a local tax history. Detail in our article on the property loan for foreigners in Japan.

As a result, from abroad you fund in cash. Three possible sources:

• Your savings (accounts, liquidated investments);
• A mortgage in Europe secured on a property you already own;
• A Lombard loan secured on a securities portfolio (you borrow against your financial assets without selling them).

In other words, the loan is taken out in Europe, then the funds are transferred to Japan for a cash payment. Note too that buying property grants no visa — financing and the right to reside are two separate matters.

Transferring funds: SWIFT wire vs Wise

Once the funds are assembled in euros, they must reach Japan in yen. Two main routes:

Channel	Speed	Cost / rate	AML traceability
SWIFT bank wire	1 to 5 business days	Fixed fees + often a wide FX margin	Excellent (bank to bank, documented)
Wise (or equivalent)	Often faster	Transparent fees + near-market rate	Good, but caps and checks

What matters for a property purchase

• For a large sum destined for a judicial scrivener shiho shoshi (shihō shoshi, property-register specialist) or an escrow account, the SWIFT bank wire is often required: it leaves a clear trace of fund origin, essential for anti-money-laundering.
• Wise can be excellent for intermediate amounts and a better rate, but check the caps and the ability to document a seven-figure yen transfer.

Tip: ask the agent and shiho shoshi in advance which channel they accept and the exact beneficiary name, to avoid any rejection on settlement day.

Yen/euro currency risk

Several weeks pass between signing the contract and final settlement. Over that period the yen/euro rate can move and change the real cost of your purchase in euros. A weak yen (as seen in recent years) is favourable to a euro buyer: the same yen-priced property costs fewer euros.

Three ways to manage this risk:

• Convert early: change your euros to yen at signing and hold them in a yen account, to lock the cost (at the price of tying up funds);
• Limit order: via an FX provider, trigger the conversion at a target rate;
• Split it: convert in several tranches to smooth the average rate.

Common mistake

Waiting until the last day and converting everything at the spot rate, suffering both volatility and a wide bank FX margin. Treat the conversion as a decision in its own right.

Anti-money-laundering (AML) paperwork and KYC

Japan applies strict anti-money-laundering AML (anti-money-laundering) and know-your-customer KYC rules. Expect to have to prove the origin of funds at several levels:

• Your home bank: for a large international wire, it will ask the purpose and documents (contract, invoice, source of savings);
• The receiving Japanese bank and the shiho shoshi: traceability of the wire, consistency between sender and registered buyer;
• Identity documents: passport, proof of address, sometimes a residence certificate or notarised deed.

Practical tips:

• route the funds from an account in your name (the registered buyer), not a third party's;
• keep the proof of origin (statements, deed of sale of a liquidated asset, tax notice);
• avoid suspicious split transfers, which trigger checks.

Our support coordinates these exchanges with the shiho shoshi and agency to smooth settlement.

A Japanese account, the payment timeline and costs

Do you need a bank account in Japan?

Not always for the purchase itself: settlement can go through the shiho shoshi or an escrow account. But to operate the property afterwards (collect rent, pay property tax and charges), a Japanese account or local agent becomes very useful — see our article on remote rental management.

The payment timeline

A Japanese purchase follows a precise rhythm:

1. Deposit tetsuke-kin (tetsuke-kin, 手付金, reservation deposit) at contract signing: often 5 to 10% of the price, paid to secure the property;
2. Balance at final settlement kessai (kessai, settlement/closing), with transfer of ownership and handover of keys.

So you transfer the funds in two stages: first the deposit, then the balance — each with its own wire delay and FX window.

The costs

The property purchase costs in Japan stay contained (≤ 6% of the price), plus international transfer fees and the FX margin. Budget them from the start.

Conclusion

Financing a Japan purchase from abroad means orchestrating three things: assembling the cash (savings or a European loan), choosing the right transfer channel (SWIFT for large traced amounts, Wise for efficiency), and managing FX and AML paperwork. With a historically weak yen, the window stays favourable to a euro buyer. Prepare each step in advance; we coordinate settlement through our support and help you target the right properties in our listings.

Frequently asked questions

Can you borrow in Japan to buy from abroad?

No for a non-resident: a Japanese mortgage is reserved for people resident and salaried in Japan. From abroad you fund in cash, mobilising savings or a mortgage/Lombard loan obtained in Europe, then transferring the funds to Japan for a cash payment.

Is it better to transfer funds by SWIFT wire or Wise?

For a large sum destined for a shiho shoshi or escrow account, the SWIFT bank wire is often required because it ensures a clear trace of fund origin. Wise offers a better rate and transparent fees for intermediate amounts, but check the caps and the ability to document the operation.

How do you manage yen/euro currency risk on a purchase?

Between contract and settlement, the yen/euro rate can move. You can convert early and hold yen to lock the cost, place a limit FX order, or split the conversion to smooth the average rate. A weak yen is favourable to a euro buyer.

What anti-money-laundering documents are required in Japan?

You will need to prove the origin of funds at several levels: your home bank for the wire, the receiving Japanese bank and the shiho shoshi for traceability, plus identity documents. Route the funds from an account in your name and keep proof of origin (statements, deed of sale, tax notice).

Do you pay a deposit before the balance in Japan?

Yes. At contract signing you pay a deposit tetsuke-kin, often 5 to 10% of the price, to secure the property. The balance is paid at closing kessai, with transfer of ownership. So you transfer the funds in two stages, each with its own delay and FX window.