What Makes Buying Property in Japan Difficult Is Not Finding a Home but the Absence of a True Buyer’s Agent

What many overseas buyers misunderstand at the outset when trying to purchase a home or an investment property in Japan is the assumption that, if they engage a trustworthy brokerage firm, that firm will search the entire market on their behalf and identify the best available property for them.

In reality, the issue in Japan’s residential brokerage market is not the mechanics of property search. The real issue is that the incentive structure of brokerage firms does not align neatly with the buyer’s interests. Our argument is simple. When buying an owner-occupied property in Japan, the greatest obstacle buyers face is not a lack of inventory itself, but rather the way legally permitted dual agency, and the incentive for property hoarding that arises from it, can distort both access to listings and the neutrality of advice.

Put simply, Japanese brokerage firms are not necessarily “your agent”

In Japan, both sellers and buyers are free to ask any real estate company to act as an intermediary. There is also a property-sharing system among real estate firms called REINS, and properties registered there can be searched by other member brokerages. On the surface, the system appears to offer broad access regardless of which company a buyer consults.

In practice, however, that is not how the market works. The reason is straightforward: if a brokerage firm can handle both the seller side and the buyer side of the same transaction, it can earn fees from both sides.

Under this structure, it is institutionally very easy for a brokerage firm to prioritize transactions that are easier to close in-house rather than searching for the objectively best outcome as a dedicated representative of the buyer.

The reality of dual agency at major Japanese brokerage firms

According to research published by Diamond, one of Japan’s major business media groups, the dual-agency ratio at major brokerage firms reaches 30% to 50% at many companies.

Part of this can be explained by the fact that large firms have the advertising power to attract both sellers and buyers on their own. Even so, from a practical market perspective, it is difficult to avoid the conclusion that many of them are clearly prioritizing dual-agency transactions.

Source article: *Property hoarding is rampant at major real estate brokerages?! Sumitomo at 50% and Mitsui at about 40%: Sellers should be cautious of firms with high dual-agency ratios [2026 edition]*

https://diamond-fudosan.jp/articles/-/148998

The core problem is that the more desirable the property, the less likely it is to reach an open market

Japan has three types of brokerage agreements: exclusive exclusive-right agreements, exclusive agreements, and general agreements. Under the first two, registration on REINS is mandatory. Under a general agreement, registration is allowed but not required.

Even where a property is taken under an exclusive agreement, firms may first place it on their own website before registering it on REINS, provide only limited detail even after registration, mark it as though an application has already been submitted, or fail to respond properly when contacted by another brokerage. In practice, these tactics can make it difficult for other firms to broker the property. This is what is commonly referred to as property hoarding.

Another tactic is to structure the engagement intentionally as a general brokerage agreement in order to avoid REINS registration altogether.

As a result, even though the formal system exists, this is not a market in which all listings are fully and continuously open to everyone.

As a consequence, buyers face two problems

First, attractive properties often can only be bought through the listing-side brokerage

In theory, buyers should be able to access market listings through any brokerage of their choice. In practice, however, the more attractive the property, the more likely the listing-side brokerage is to want to find the buyer on its own. That makes outside introductions harder. As a result, buyers often end up having to contact a different listing-side brokerage for each individual property.

Second, the agent function itself becomes weak

Rather than acting solely to maximize the interests of either the seller or the buyer, brokerage firms often operate within a structure of conflicted incentives, where the practical objective is to get one side, or both sides, to compromise enough to complete the transaction and generate a fee.

A truly dedicated buyer’s agent does not really exist under this structure

This is where the difficulty lies for foreign buyers trying to acquire property in Japan.

Ideally, a buyer should be able to explain their acquisition strategy, background, and practical constraints to an agent who works for them and introduces properties accordingly.

In reality, however, the chances that such an agent also happens to control the listing on the property you actually want are extremely low. That means the buyer may ultimately need to purchase directly from the major brokerage that controls the listing. At the same time, the independent agent the buyer would like to rely on receives no success-based brokerage fee at all. That is the structural dilemma.

Our view on what buyers should do

In our view, anyone acquiring an owner-occupied property in Japan should separate two ideas that are too often treated as one: asking a brokerage firm to show properties and securing an adviser who actually represents the buyer’s interests.

The former is about gaining access to inventory. The latter is about improving the quality of decision-making. For that reason, the most realistic solution is to retain a buyer-side adviser on a fixed-fee basis, separate from brokerage commissions, and build a framework in which that adviser can compare and evaluate not only properties circulating under general brokerage arrangements but also properties that the adviser cannot directly broker in-house.

Our firm has particular strength in STR-related assets and also handles many properties directly as the listing-side broker. At the same time, for central Tokyo tower apartments, investment apartments, and other assets where we are not the listing-side broker, we can still participate as an adviser. Please feel free to contact us.