AirBnB or Bust?

A common concept in Japan is known as mottainai, which essentially means that things should not be wasted whenever possible. You might be thinking the same if you own a vacation property in Japan, but don’t spend enough time there. Perhaps you’d been throwing around the idea of renting it out on AirBNB or another online listing site. Especially with the border restrictions set in place due to the COVID-19 pandemic, some have not been able to travel in and out of the country, and may be wishing to instead use their properties for lodgers in the meantime. 

Is it possible and if so, how?

With the new Private Lodging Business Act that went into effect in June of 2018, short term rentals of under one month without a tenancy lease, also known as minpaku, became much more strictly regulated. This legislation means that hosts of these minpaku short term rentals need to register and publicly display a private lodging notification number for their listings online with sites like AirBnB. For hosts, an arguably more important rule of the minpaku law is that a host must hire a designated and minpaku-licensed property manager to be responsible for the property, unless the owner lives on site (or very, very close at least). Local municipalities are also able to regulate minpaku regulations on their own terms and can be stricter than the national legislative framework. So what may be true for one area is usually entirely different in a neighboring ward of the same city. Research and investigation of specific ward or city requirements will be required (which can be outsourced as part of our services).

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Why was this law enacted? 

It can be attributed to a number of reasons, one being that the Japanese culture tends to try avoiding confrontation when possible. If there are tourists or short term lodgers frequenting a town, not all are guaranteed to respect the property or people, resulting in difficulties and potential confrontations for the residents. Some such inconveniences that arise involve the strict trash separation laws in the country that tourists sometimes unawarely disobey, leaving the residents literally picking up after them. Another is that lodgers may be a bit more noisy or go in and out of the property late hours of the night, causing general disturbances for the residents that live there. 

In areas where it’s allowed, how can I host?

If you’ve prepared yourself to operate a private lodging under the minpaku law, you’ll have to get registered with the prefectural governor or similar entity with the intention for business. 

To do so, you’ll need to prepare documents including but not limited to: 

  • An identification certificate proving no current status of bankruptcy
  • Proof of ownership of the land or permission from the landlord to engage in minpaku activities
  • Floor plans of the property
  • A letter of approval from the owner union in case of a co-owned building
  • A minpaku notification form 
  • A certificate of consultation from the local fire department
  • Notification document for the nearby residents of a private lodging business intention
  • An agreement with the private lodging administrator if not living on-site

With these and other necessary prepared documents, application for the registration number can be done through the Minpaku portal website, although this is only currently available in Japanese. General information can be obtained from the website in English, however, and should be utilized in preparation of hosting. 

What other options do I have?

Japan105Although the minpaku law can be strict and troublesome at times, the good news is that there are other ways to offer short-term rentals in Japan. 

The Inns and Hotels Act allows for a Small Hotels Business Permit to be obtained, which allows a property to be operated and rented out 365 days of the year. With this permit, you do not need to complete the minpaku lodgers’ reporting process that is usually done with the minpaku Lodgers’ Registry Book.

Another option is known as Tokku Minpaku, or Special Zone Private Lodging, where the government designates particular areas related to tourism. With this license, more than 180 days are available for lodging but the minimum stay is 2 nights and the maximum is 9 nights. 

Where to go from here?

If you have any questions, feel free to drop us a line by email or on any of our social media accounts.

We’d be happy to hear from you as you take the first steps on your journey of private lodging operations. Happy hosting!

References

Keycafe Team. (2019, June 14). Understanding Japan’s short-term rental regulations. Medium. Retrieved from https://medium.com/@keycafe

Japan Real Estate. (2018, June 6). The New AirBnB & Short Term Stay Legislation (No. 29) [Audio podcast episode]. In Japan Real Estate. https://open.spotify.com/show/3CBbtuMMsrU6rekqM3oxKj

Japan_Real_Estate. (2022). AirBnb VS Monthly Rentals in Japan and How to Run an AirBnb Business in Japan?. [Youtube Videos]. Retrieved from https://www.youtube.com/c/JapanRealEstate

Japan Tourism Agency. (2022). Private Lodging Business: Portal website for private lodgingminpaku」. Minpaku Portal. Retrieved from https://www.mlit.go.jp/kankocho/minpaku/index_en.html

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