The best of 2018 quarter 1 property in Japan.

If you haven’t joined us on LinkedIn yet, please do.  The LinkedIn group is called Japanese Investment Properties and every day we post the best investment property we can find.  Our criteria are very simple, high returns, great location and already tenanted for instant cash flow.

Coming up to the last week in March, the last week of the first quarter in 2018, we review the best three properties we found.  Join us on LinkedIn Japanese Investment Properties to access daily deals like these.

Property Number One

8% net return in Kobe!!!

This is a great investment property. Recently renovated, 4 minutes from the station and returning 8.2% net!!! This will not stay on the market for long. Built in 1977, 21 square meters, on the 2nd of 4 floors. One of 32 south facing bright 1 room apartments. Annual income is ¥540,000, low monthly charges of ¥8,455 and annual land taxes of ¥24,300. All for an asking price of ¥5 million.

Property Number Two

Brand new building in Tokyo

A brand new building, just completed in November 2017. A wood frame building built on a corner plot in Tokyo with 10 apartments. 8 minutes walk to the nearest station, a must for Japanese tenants. The ground floor has five 17 square meter apartments and the second floor has five 17 square meter apartments with 5 square meter loft space. The building already has 9 apartments filled and the last one is under offer. With an asking price of ¥114 million yen and an annual income of ¥7.4 million, who ever purchases this apartment will enjoy 6.5% returns and limited maintenance due to the high construction standards in Japan.

Property Number Three

Bargain property in Fukuoka

Once in a while, they come along. This one is in Fukuoka and the asking price is a mere ¥2,800,000 or US$26,000 according to! Built in 1987, this top floor apartment, the 7th floor has an annual income of ¥344,400 and monthly charges of ¥10,650 giving a gross ROI of 12.3% and a net of 6.9%.

Let us know how we can help you, single lets or buildings in Tokyo, Kobe, Osaka, Fukuoka, Sapporo or anywhere in Japan.  Contact JPI today.

Japan is booming!

Japan is booming!

Japan on the up.

The stock market is up.  Next year is the Rugby World cup.  And of course, everyone is gearing up for the Olympics in 2020.

Local train company going Global.

In the past twenty years, there has never been a better time to invest in Japan.  We see it here every day but forget that most of our investors live overseas.  We came across an article from Deal Street Asia which highlights Japan’s resurgence perfectly. JR Kyushu, or Japan Railways Kyushu, are using some of their profits. Entering the Thai real estate market with a deal to purchase 429 apartments in Bangkok.  The deal will cost JR Kyushu US$90 million with a further $100 million going into refurbishment, no small deal.

Bumper profits make deep pockets.

Keep in mind that JR Kyushu is merely a railway company in the south of Japan. The benefits of inbound tourism across the country have been enormous.  Companies like JR Kyushu have benefited from bumper profits as 29 million tourists flood the country.  Spending within Japan has jumped significantly in the past 5 years.  Japanese companies with full wallets and are going shopping for bargains overseas.

History repeating itself.

This could be a throwback to the bubble days.  Days when Japanese companies bought foreign assets like they were going out of fashion.  Growing up in Britain in the 80s Japanese companies bought the local golf course, hotels, and shopping centers.  It seems like history is repeating itself.

Stable investments.

We have a different view than the Japanese companies.  At JPI we prefer to invest IN Japan where returns are good, tenants respectful and investments stable.  We wish JR Kyushu well in their foreign mission. Hopefully, they purchase more and more overseas properties, leaving the Japanese ones to us here at Japan Property Investments.

Japan’s JR Kyushu buys Bangkok apartment complex for $90m


Locating cash flow properties and capital growth properties

Locating cash flow properties and capital growth properties

You are now in the position to look for a unit or house but what determines whether a property would be a good cash flow property or a capital growth property.
Below are some of the key points you should be looking for in your search.

Locating Cash flow properties
  • Look in high yielding suburbs
  • Buying properties 20 – 40% below the median price for the suburb.
  • Buying in regional areas or targeting student accommodation.
  • Renovating and adding value to increase rents.
  • Managing interest rates and fixing when we think the current interest rate is at the bottom of its cycle.
Locating capital growth properties
  • Strong economic growth and low levels of development
  • Close to schools, shops and public transport
  • Close to a capital city
  • Older properties rather than new ones
  • Properties that have rental appeal
  • Purchase in countries where there has been a history of growth
Cash flow properties and Capital growth

Cash flow properties and Capital growth

Let’s be honest here “The Perfect property does not exist”

To find a property that has positive cash flow and has capital growth especially in the short term is very difficult to find. The better strategy is to have a balance between capital growth and cash flow properties in your foundation portfolio. Over time a cash flow negative property may become positive.
It is also possible to improve a property through renovations that could lead to positive cash flow and also increase capital growth

Therefore what’s the better option, capital growth or cash flow?

This all depends on your current circumstances, but there are a few considerations to take into account to know what might fit you best.

Do you want to increase your personal wealth, or do you want a source of income?

If you want to grow your personal wealth, then you should choose a capital growth strategy. As a general rule of thumb, capital growth is best for investors aged between 20 and 60, who are still accumulating their wealth. Buying high growth properties will allow investors to benefit from compound growth as their properties rise in value and amass significant personal wealth.

As you near retirement, you should‘ve created the wealth required to live the type of lifestyle you want. However, you’ll also require a source of income if you’re no longer working.

This is when a cash flow strategy is necessary as investors can utilise the rental returns as a means of passive income.

Whatever is your preferred strategy is essential to purchase in line with your goals and financial position, while also buying each property in the right order.

Cash flow vs capital growth

Cash flow vs capital growth

What will make you richer faster? Is chasing positive cash flow the best way, or is a capital growth strategy the better option to suit your situation? Before deciding on your preferred option, you need to look at some of the pros and cons of cash flow and growth property investments.

Cash flow strategy


– Using a cash flow strategy means investors are getting a weekly income and realising the value of their investment over the short term.
– Investors have more cash in their pocket to cover regular property expenses and unforeseen property expenses.- Extra cash can be used to pay down loan creating equity.

– In a residential property scenario where a property has a high rental yield and cash flow, it generally has very negligible or no capital growth.
– Since investors are earning a positive income, they can’t take advantage of a negative gearing tax benefit and instead have to pay tax on their rental profits.

Capital growth strategy

– Increased value of the property over the long term more than outweighs the cash flow benefits in the short term.
– Investors are more likely to make a loss with a capital growth strategy and can take advantage of a negative gearing tax benefit.
– LVRs are generally more generous, because banks are typically more comfortable lending for properties in desirable growth areas, often big cities.

– Cash flow is negative, meaning investors with a capital growth strategy need to dip into their own pockets to cover property-related expenses, such as mortgage repayments and council rates.

Why not contact us at and we can explain more about investing in Japanese Real Estate.

Capital growth strategy

Capital growth strategy

A capital growth investment strategy is where a property is purchased that is expected to produce above-average increases in property value over time.

These properties often have a higher purchase price and lower rental yield. This is referred to as negatively geared, which means the annual cost of your investment is more than the investment property rate of return.

This strategy has 2 advantages:

In some countries tax benefits or deductions may be claimed for some of the out-of-pocket expenses or losses. Some countries, such as the UK has stopped allowing this and other may follow

The other advantage is that as your investment property value increases you may be able to draw out equity or borrow against it to expand your investment property portfolio.

These properties are typically found in capital cities, major regional centers or areas under development. They often come at a premium and require you to dip into your savings to cover mortgage costs.

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