Wednesday, March 31, 2010

The Timelime (First Quarter)

As promised here's a time line of the process thus far with regards to land acquisition.

  • Research the fudosan websites and decide on 2 main sites to check daily and subscribe to automated email notification when new land are advertised based on my criteria.
  • Decide on and
  • Reach out to many friends who own or have built a home recently in Kichijoji.
  • Get an introduction to a builder which a friend used to renovate her home.
  • First Meeting with Real Estate Agent and Builder (both from S company). Also present is an Architect from I company. We discuss generally about the area, the market, supply and demand, overall process, my expectations and general time frame.
2/6/2010 :
  • Visit the Real Estate agent and get more information about a proposed lot (Lot A). Who is selling it? How long has it been in the market? Why is the owner selling? Any recent price reductions? Is the owner willing to negotiate? Why is cheaper than the other plots?
2/23/2010 :
  • It turns out Lot A has a Toshi Keikaku Doro. There was been a plan for the past 30 years to build an overhead highway directly next to the lot. The land is not exactly on the planned highway thus it is unsure if there would be compensation if it is ever built.
  • After some careful research, the highway plans have changed from overhead to underground. The air vents and exit and junction points are 8km north and south. Some uncertainty surrounding the land but overall I'm ok with it for a good price.
  • According to real estate agent and preliminary discussions, the owner is willing to accept 5% discount on the land.
2/28/2010 :
  • After a week's work of paperwork, MUFJ pre-approves loan at 90% the amount we requested. No clear answer as to what we could do to bump this up.
  • Land owner after consulting a lawyer restates her intention to sell. The new position is the will only sell at the asking price. Is this a negotiating tactic?
  • Call the owner's bluff and submit formal 5% discounted offer.
  • Mizuho pre-approves loan at 95% of requested funds. The one condition is that I pay my car loan in full first.
3/18/2010 : First offer rejected.

3/29/2010: Second offer @99% of asking price = rejected. Real estate agent comes back with an offer to subsidize the 1% difference. Third offer at full asking price = rejected...????

4/3/2010: After all this effort, I met the real estate agent to find out where things went wrong. Did we push too hard? Do we wait for things to cool down and see what happens? Are they at all serious about selling? His answer was basically that he never had an experience where the asking price was not accepted and he frankly questioned the fact whether the owner was in a good disposition to be conducting business. As there are many details that would need to be discussed and agreed, he suggested we don't pursue this lot anymore to save ourselves the anguish. The owner is just not reliable enough.


  1. Hi,
    Thank you for this blog. it has been a wealth of information. It is also nice to know that there are others out there who have attempted and succeeded in building a house in Japan.

    We have just started our own journey. We found the lot already, now it's just a matter of the owner deciding to sell to us or not.

    I have a few questions regarding your loan and your architect. you mentioned that you didn't have permanent residence when you applied for the loan and still managed to get 95% of the loan approved. Right now HSBC tells us that we could get only 70% of our desired amount because we don't have permanent residency. So if Mizuho can make 95% happen, then it seems worthwhile to switch banks.

    as for the architect, you seem to be happy with yours. I spoke to one who was introduced by a realtor i worked with. he was going to charge 10% of the house cost, but promised to be the one to negotiate the total price of the house down. He seemed like a nice enough guy, but of course the question is can he be trusted. Would you be willing to share your architect? I want to meet several before i decide on who to work with.

    E from Setagaya

  2. Hi E,
    We didn't try to go with foreign financial firms since in general they lend less and have higher rates. MUFJ would give 95%, Mizuho gave 100% of what we asked. But to be clear that covered about 80% of the total cost of land, home, and other associated fees.

    About architects: Yes 10%~15% is not uncommon. Depends on their reputation. And yes, they help to bargain prices down for you. But you should still do cost comparisons on your own as a sanity check.

    We loved him. If you're interested I can introduce you and the builders. email me at and I can help set up something.