Useful Informatmion of Administrative & specialized procedures in Japan

Following the previous articles of this series (Nov. 24, 2024 and Jan. 17, 2025), this month's article will focus on the handling of real estate in the post-death procedures of parents living in Japan. Specifically, we will discuss (1) Things to keep in mind immediately after death, (2) Real estate registration procedures for inheritance, and (3) how to dispose of real estate for the future.

1. Things to keep in mind immediately after death - Your place of residence until the inheritance procedures are completed.

When a erson dies, various procedures occur. Starting with notification to the city hall, funeral arrangements, contacting related parties, administrative procedures, notification to financial institutions (account closure), inheritance (taxes, division of property), and organization and disposal of real estate and belongings are all involved. When a parent living in Japan passes away and you are responsible for these procedures, they will not be completed in a short period of time. Depending on the circumstances, it may take several months to a year, and if you need to return to your country of residence (the U.S.) for work or other reasons, you may need to repeat your visit to Japan several times. At this time, you will continue to work and stay in the house where your parents lived, so be careful not to stop electricity, water, gas, etc. contracts after their death because they are useless. The same also applies to telecommunication-related (Internet line, TV, telephone, etc.) contracts that your parents had subscribed to. If you cancel the contract because the monthly fee is useless, it is inconvenient for you to stay, and it may be better to continue the contract because information on your financial assets may be stored on your computer or smartphone. Note that once these contracts are cancelled, it is not possible to re-enroll in them since the person has already died. 

2. Real Estate Registration Procedures

1) Inheritance registration is required.

First of all, real estate registration is explained in the Ministry of Justice's website,

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The Rregistry is a public record of the location and area of land and buildings, which are important assets, as well as the name and address of the owner, and is made available to the public so that everyone can understand the status of rights and relations, thereby facilitating safe and smooth transactions.
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If the house your parents lived in was a private home, meaning they were the owners, then the home is also part of their assets and ownership is transferred to the heirs through inheritance.  Therefore, it is necessary to change the owner's name to that of the heirs. This is called "Inheritance Registration. 

2) Procedures

Follow the steps below to proceed.

● Where to apply?
The Legal Affairs Bureau with jurisdiction over the area where the family home (real estate) is located.

● Due date - When?
Inheritance registration was required to be done as soon as possible after the occurrence of inheritance, but until now there was no particular penalty for neglecting to do so. However, as of April 2024, penalties will be applied if the inheritance is not registered within three years from "the date on which the heirs become aware that they can acquire real estate through inheritance" or "the date on which the division of the estate is approved".  Specifically, a fine of up to 100,000 yen will be applied if the obligation is violated without justifiable reason.

● Applicant for registration - Who?
The representative of the heirs will perform the procedure, but procedures can also be completed by a representative (Power of Attorney required). If you wish to pay a specialist to process the application on your behalf, you can ask a Lawyer or Judicial Scrivener to do so. The heirs can apply by themselves after receiving instructions at the Legal Affairs Bureau on how to fill out the necessary documents and application forms, but if this is difficult, it is better to ask a specialist to proceed smoothly. 

3) Use of Inheritance Division Agreement

If there is more than one heir, the decedent's property is distributed in the proportions set forth as the legal inheritance. For example, the spouse will receive one-half of the estate, the remaining one-half will be divided equally among the children, and so on. This division is made on a cash or real estate basis. However, since real estate is a thing, it cannot be divided equally among the heirs as easily as cash. Once ownership of the real estate is registered as co-ownership among all the heirs. However, if the property is registered as co-owned property, it is troublesome to require written agreements from all the owners when disposing of the property, such as sale or demolition, afterwards. Therefore, when dividing the estate, it is possible to designate that one of the heirs shall acquire the real estate. In this case, it is convenient to make good use of the inheritance registration by one owner by obtaining the agreement of all heirs and preparing an inheritance division agreement.

3. How to dispose of it for the future - What to do with the inherited real estate? 

1) If the house is in habitable condition

If the inherited real estate consists of land and building or building (house with leasehold interest) and it is still habitable, there are three options: A) The heirs or relatives continue to live in the property, B) Sell the property, C) Rent the property, etc.  For A), if there is a person who wishes to live in the property, it is no problem if it is agreed with the other heirs.  For B), C) if there is no one who wishes to purchase or rent the property, it is common to ask a real estate broker to do so. 

2) If the house is uninhabitable

On the other hand, if it is difficult to continue to live in the property because the building is old and dilapidated or damaged by natural disasters, there is an option to demolish the property, clear the land, and then build a new house or sell or lease it as vacant land. Demolition is done by a demolition company, but in the case of land and building, a real estate agent may be able to purchase the property including the demolition work.

4. Precautions for Overseas Residents

This is true not only for overseas residents but also for heirs residing in Japan, but we will introduce this as a problem that overseas residents, who have little contact with Japanese laws and systems, are particularly prone to.

1) Inheritance registration should be done as soon as possible.

Many people file and pay inheritance taxes and dispose of family property as part of what should be done at the time of inheritance, but inheritance registration is a tedious process and is often put off. However, we recommend that you complete the procedure as soon as possible.　As mentioned above, penalties may apply due to legal revisions, but if left unattended, the registration itself will remain unchanged, but when inheritance shifts from the children's generation to the grandchildren's generation, ownership of the real estate will automatically be passed on to the grandchildren's generation as per legal inheritance. If this happens, the number of owners may increase, and some of them may have relatives whose contact information is unknown, making the registration procedure difficult.

2) Understanding of identification documents.

Since registration determines the ownership of real estate, an official certificate (official document) is required to prove that the heir is the heir himself/herself. If you are a resident of Japan, you can use your certificate of residence or seal registration certificate to complete the registration procedure. However, non-residents do not have such certificates, so you will need a certificate of residence or a signature certificate. In addition, since only Japanese nationals can obtain such certificates at Japanese embassies and consulates, foreign nationals should check with the Legal Affairs Bureau or a specialist before applying for them.