Japan expat rental scene: When your apartment is always defined as a hotel!

Anyone who’s tried to land an apartment in Japan might appreciate this.

It’s been written about for years how Japanese are leery to rent to gaikokujin (foreigners). Usually, the stories go that the landlord makes any excuse, simply becomes unavailable, or flatly says “sorry”.

However, there are groups of landlords who are more than willing to rent to foreigners. This is because something is going on, unexplained, about what they are going to try to say that they are actually doing.

Debito.org, the website for basically any non-Japanese civil right issue in Japan, ran a piece about it in April. One that I am, um, familiar with. “Tokyo Reader” on odd rental contracts for apartments: “lease” vs. “loan for use”? Plus Kyoutaku escrow for disputes (Debito website, April 27, 2009)

To paraphrase, contracts to lease an apartment are governed under a special law called (in English), “Land and House Lease Law” (“LHLL”). The LHLL contains numerous protections for the renter, seeing as how the landlord ordinarily has the disproportionate power. Plus, this being a nation of renters, the renters do have some political pull.

There are protections like notice of eviction, a 6-month grace period before you can be evicted, the ability to challenge the rental price you are paying if you find out that your unit is overpriced compared to the market.

A leasehold is even defined as a contract whose initial term exceeds one month. Where there is no definition, the assumption is that it’s a lease under the law.

Useful protections.

So, going with this week’s theme: a Japan that’s a fair dealer or a Japan that’s sleazy and corrupt, what do you think happens when the situation involves foreigners?

Yes, that’s right. Figure out ways to make a lease sound like it’s not a lease.

The most common way to do this is to assert that what the landlord is actually leasing are “monthly apartments”. LeoPalace 21 is probably the best-known for this.

What the “monthly apartments” or “monthly mansion” meme seeks to do is to turn a leasehold interest into, basically, something like a hotel room. These are governed under an entirely different set of Japanese Law, the Civil Code, Article 593 (“Loan for Use” contracts).

LeoPalace is pretty specific about the contract wording and what they’re trying to do up front. So they look to be able to sell apartments for a three-month or even one-year stretch as if they were prepaid, extended-stay hotel rooms. I don’t know if anyone among the Japanese has poked at those contracts at all yet.

With “loan for use”, usually the prices are substantially higher. And you’re also being charged extra for each and every utility or service that is coming into the unit.

“Loan for use” is also very specific: if you do anything to go outside the rule or do something that puts yourself into LHLL, you are in LHLL.

The Leos and Chintais manage to do everything correctly– or are big enough to get off if they don’t. (I don’t know.) But in the local markets, with smaller landlords and agencies, everything gets very sloppy.

For instance, you may be offered a three-month renewable lease — it says “lease” right on the top of the contract, in English — with a 30-day notice provision, while your neighbor was offered a two-year lease with a 30-day notice provision. (Notice that in each case, the lease ends when you let the landlord know, 30 days ahead of time, that you want out.) The three-month lease is priced much higher (upwards of 50%) than the two-year lease. Why? They are both under LHLL, right?

Well, the reason is simple, isn’t it? This is dealings with foreigners, which is much different than if you are dealing with the Japanese community. For one thing, the foreigner isn’t even supposed to know what the real law is. Then, when things have been nicely confused, well, there are all those Japanese shades of gray that are tried to be worked into every situation for advantage.

And fixing a situation involves, then, a what? A fight. Which makes it look like the gaijin “just can’t fit into Japanese society and always look to make trouble.” See? This is all a big game for them.

“Oh boo hoo! Oh boo hoo! We explained evvvvvvvvvverything in the beginnnnnning! Boo hoo! Why did we havvvvvvvvvvvve to put the contract in English, it would have been better if we could have just used our own native language of Japanese!!!” (which, it’s left out, would never have been signed to begin with!) “Oh no! First, our humiliating defeat in that bad War, and our humiliating occupation by the GHQ . . .

And now . . . this!

(And “this” is simply pointing out that the landlord and/or agent is royally screwing somebody, because they figure people don’t know the rules.)