“Reikin” (meaning the dreaded “Key Money”) is a different matter altogether. Key Money is a throwback from the end of World War II where Tokyo was still in the rebuilding phase and living quarters were scarce. People then would pay “Reikin” as a separate gift to the owner for allowing the tenants to live in the owner’s apartment. Despite the fact that Tokyo has since rebuilt and there are many number of locations to live, “Key Money” still exists. That said, there are several ways one can get around paying Key Money which are listed below;

1) If an apartment is listed at 2 months “Key Money”, a prospective tenant might be able to lower the Key Money by offering to pay a higher rent. If you were to try this tactic, then expect to pay between ￥20,000 – ￥30,000 / month in higher rent to reduce the key money to 0. This on the surface looks like the same amount of money coming out of your pocket but if you think you might only stay in the apartment for a year and a half say, then paying higher rent is best rather than paying 2 months key money upfront at the contract signing (as the remaining 6 months you are not living in the apartment you are not paying for at all). Success rate for this tactic is somewhere between 50 – 70% depending on the time of the year and property managers / owners.

2) Outright Elimination of Key Money without Higher Rent – This is an ultimatum to the property manager and owner from the get – go and has little chance of working. Everyone knows a (notice the singular pronoun) friend that got a great deal on slashing the key money on their great apartment and most people assume this is the best way to go about reducing key money. What most people do not realize is that for every one person that successfully negotiated out key money by outright refusing to pay it, there are fifty others who have tried and had their applications outright refused and did not get their dream apartment. Success Rate – 5-10%

3) Watching, watching, watching – This is probably the most successful way to eliminate key money but the most time consuming. Once you have located the building you really want to live in then keep an eye on it for campaign pricing. Usually when a building has a “campaign” that means the first thing to go is key money as the unit has been empty for a couple of months and the owner just wants it filled. Warning though, once your targeted apartment reaches the point of slashing key money to find tenants, be quick to apply as foreign and especially Japanese people alike jump on these apartments very quickly. Success rate – 100% (but takes months to do)

4) Be flexible with your location – Due to the volume of buildings in Tokyo generally, there is at any given time a number of buildings advertising campaigns of 0 Key money. If you do not mind spreading your property search over various wards of Tokyo rather than just limiting yourself to one specific station or area, than your chances of finding a 0 key money apartment increase greatly without having to wait months like option 3 above. Success rate – 100% (no waiting)

Adam is the Director of Operations at TokyoApartment.com.

First, let’s cement up some things you have probably heard about the Agency fee. Yes, it is a non-refundable expense you pay in order to get an apartment. Yes, it is basically for the realtor’s time spent searching for prospective apartments for you, taking you to see them, negotiating the terms and securing the lease for you on the apartment you have chosen. Yes, it is usually equal to 1 month’s rent based on the apartment you choose. No, it is not the same as key money.

Sure there are places out there that offer no agency fee deals in the ￥70,000 – ￥100,000 price range. These locations tend to be furnished but small apartments though if you are looking for a short term stay (anything less than 6 months) then this is the way to go. Outside of this budget, if you are not willing to pay an agency fee then your options become severely limited in terms of selection you have available as 90% f apartments in Tokyo require this expense.

Who gets the agency fee? The answer is your real estate agent. That person who sorted through hundreds of available floor plans looking for apartments to try to suit your needs. That person who then called around and organized the keys for each apartment you wish to see and then taking you to see it, along the way telling you about the area you happen to be in at that time. That person who then negotiated the procurement of the lease for the apartment you chose. The agency fee is payment for a professional service that helps you secure the most fundamental aspect of your life wherever you are…the four walls around you.

However, the above is a very rosy picture. The reality in Tokyo is that there are very few real estate agencies out there that can offer foreign people a truly professional level of service and very often paying an agency fee can leave a bitter taste in one’s mouth given the lower-than-expected level of service clients sometimes receive.

Common places for disappointment when looking at apartments is the quality of places foreign people are shown. Many times people see apartments that are nowhere near their ideal floor plan or location. Many times people are shown apartments that are too expensive. Many times people have initiated an application process only to find that no foreign people are allowed (more on this one to be discussed in a later blog so stay tuned). These are all examples of an agent who was not listening properly to your needs and desires and in the case of “no foreign people” this is an example of the agent not performing any due diligence.

If your agent is showing you apartments that are within your budget, space and locations needs, then that is a very big sign that the agent listened properly when you initially told them what you wanted. This kind of agent deserves your trust at this point because if within a week of contacting that particular agent, if you have 2 or 3 apartments all within the specs that you can choose from, that means that agent has worked his tail off to source these places for you and will do their best to get you into the apartment you choose. This kind of agent truly deserves your agency fee.

Key money can easily be considered money down the toilet but the agency fee, paid only after all the hard work is done and you are about to get your keys is fair to pay as long as you, the client, find an apartment that you are looking for that satisfies your needs and desires.

Adam is the Director of Operations at TokyoApartment.com.