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How Should You Decide On The Monthly Rent Budget In Japan?

Updated: Nov 24, 2023

Moving to Japan can be exciting, but it's important to manage your money well, especially when it comes to rent. Here's what you need to know:

Location is Key: The cost of living in Japan varies by city and neighborhood. Urban giants like Tokyo and Osaka typically tend to have higher rents. We suggest tenants research your desired location to compare rent with your budget before making any decision.

The 3x Guideline: Your annual salary should be at least three times your annual rent. For instance, with an annual income of ¥5,000,000, your yearly rent shouldn't surpass approximately ¥1,680,000, or ¥140,000 per month.

Your Monthly Earnings: Ideally, you shouldn't spend more than 30% of your monthly income on rent. Calculate your net income (after taxes) and make sure you can comfortably set aside about 30% for housing.

Lifestyle and Outlays: Your individual lifestyle and monthly expenditures (such as commuting, utilities, groceries, and leisure activities) directly influence your rent budget. Craft a financial plan that encompasses these costs in addition to your rent.

Initial Costs: In Japan, landlords typically insist on upfront payments like security deposits, key money (reikin), and agency fees. Maintain a financial cushion to tackle these expenses without straining your financial stability.

Co-Living Solutions: If rent seems high, consider shared housing like guesthouses or shared houses. They can present a more cost-effective option, enabling you to reduce your rent expenses while still enjoying a comfortable lifestyle.

To decide how much of your income to spend on rent in Japan, you should research your location, calculate your income, consider your expenses and lifestyle, and save for initial costs. Hope that this information helps you in the decision-making process on which apartments you should rent in Japan.


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