Tokyo coastal 3-bed at ¥172,100,000 and ¥771,000/month — does the yield hold up?

There is also a tension between vacancy and rent. You can often reduce one by accepting the other. I would model a quicker letting at a lower rent rather than assuming both ¥771,000 and minimal downtime.
 
Ask who is responsible for garden, exterior and any equipment supplied with the home under the intended lease. For a detached or house-style rental, those responsibilities can affect both tenant appeal and the owner’s maintenance budget.
 
Nina’s point suggests a useful sensitivity table: achieved rent across the top, vacant months down the side, with net cash flow in each cell. Then repeat it with the larger repair occurring. That will show whether the deal has a broad safe range or one narrow winning scenario.
 
I would add a cash-timing column to that table. Property tax, insurance, repairs and leasing costs do not arrive evenly each month. Even if the annual result remains positive, the reserve needed to carry a vacant high-rent home may be substantial.
 
Be careful not to double-count. If the management quote already includes leasing or turnover work, don’t add it again; if the repair reserve includes routine replacements, separate maintenance may overlap. Request an itemised scope for every allowance.
 
The exit case matters because a future buyer may not value the property on rental yield alone. A coastal 3-bed home could appeal differently to owner-occupiers and investors. I would avoid assuming the resale price simply rises in line with rent.
 
Agreed, although I would assign no appreciation in the base case rather than trying to forecast that buyer mix. If the operating return is unattractive without capital growth, the decision is really a price-growth bet rather than a rental deal.
 
At this stage the missing inputs seem clear: support for ¥771,000, exact intended lease use, address-specific tax and insurance, management scope, turnover costs, coastal maintenance exposure and financing terms. Until those are filled in, debating whether the net yield is adequate is premature.
 
I’d turn that list into conditions before proceeding, not just research topics. Set a maximum all-in cost and minimum stressed cash flow in advance. Otherwise each new expense can look individually small while the original 5.4% quietly erodes.
 
My practical sequence would be: verify achievable long-term rent, inspect specifically for coastal exposure, obtain address-specific tax and insurance figures, read the management and lease assumptions, then rerun vacancy and financing stresses. If the deal fails after one ordinary turnover plus a planned repair, the purchase price needs reconsidering.
 
You must log in or register to reply here.
Back
Top