Foreign Real Estate Ownership to Be Unified Management, Government Plans to Begin Operation in FY 2027

The Japanese government is advancing the construction of a unified management database for foreign real estate ownership, planned to begin operation in FY 2027. This database will centrally manage real estate information held by foreign nationals through real estate registration, nationality registration, and other means.

The government will use the "Real Estate Basic Registry" being constructed by the Digital Agency to build this database. The Cabinet Secretariat, Ministry of Justice and other relevant departments are advancing discussions, with the goal of beginning operation in FY 2027.

The database's registration targets include real estate registration such as apartments, forests, agricultural land, large-scale land transactions based on the National Land Utilization Planning Law, and important land such as border islands and areas around defense-related facilities.

Currently, agricultural land requires registration of the acquirer's nationality, but real estate registration such as apartments does not, showing differences in systems for different real estate types. The government plans to unify declaration conditions as an opportunity from this database initiative.

For cases of acquiring real estate through foreign funds and establishing corporations in Japan, it will also be possible to grasp purchase situations. For forests and large-scale important land transactions, it is planned to require declaration of the nationality of major shareholders and directors of corporations.

For real estate acquisition by foreign nationals residing abroad, currently under the Foreign Exchange Law, there is a declaration obligation only for investment purposes and other cases, but it is expected to expand the target scope.

The background for promoting ownership transparency is that there are voices of concern among the public such as "foreigners are buying Japanese land" and "water source land is being acquired and groundwater is being extracted". There are also opinions pointing out that speculative purchases by foreigners have pushed up apartment prices.

Once nationality registration and management mechanisms are improved, it may be possible to set differences in real estate-related tax rates for Japanese and foreigners, or set regulatory conditions for acquisition itself. The government plans to summarize regulatory direction in the basic policy on foreign national policy to be formulated by January next year.

Data source: Yahoo! News, Yomiuri Shimbun Online