Reikin and Shikikin: What a Japanese Lease Really Costs

Reikin is a sum paid to the landlord when a Japanese lease is signed, for nothing in return and with no refund. Shikikin is the security deposit, returned at the end of the lease minus damage. Both are counted in months of rent, and they sit alongside four or five other line items.

The upshot: moving into a Japanese flat commonly costs four to six months of rent, paid in one go, before the keys change hands.

The bill, item by item#

For a studio at 80,000 yen a month, a typical move-in bill looks like this.

The agency commission is the only capped item: the real estate transaction act limits the total taken by the intermediary to one month's rent plus consumption tax, split between landlord and tenant unless both agree otherwise. Everything else is local custom and negotiation.

Where reikin comes from#

No explanation commands agreement, and the trade offers three.

The first is the 1923 Great Kantō earthquake: Tokyo destroyed, landlords housing the displaced, families saying thank you. The second is the post-war years, when the capital was short of housing and provincial families entrusted a student child to a landlord along with a sum meant to commend them. The third, more prosaic, is simple bargaining power: in a market where demand exceeded supply, whatever could be asked for was.

Regional usage confirms it is custom rather than rule. The Kansai long practised 敷引き (shikibiki) instead, a flat retention on the deposit, known in Osaka and Kyoto under other names still.

Reikin is retreating#

Two forces push it down. Demography first: vacant housing is rising, and a landlord prefers a tenant without gratitude money to an empty flat. Then the listing platforms, where filtering for 礼金なし ("no reikin") takes one second.

Listings known as ゼロゼロ物件 ("zero zero"), with neither reikin nor shikikin, have multiplied in the big cities, usually with a trade-off: a flat cleaning fee charged on the way out, a slightly higher rent, or a penalty for leaving within one or two years.

One landlord avoids all of it: UR賃貸住宅, the rental stock of the public urban renaissance agency, charges no reikin, no agency commission, no guarantor and no renewal fee. The flats are often older and larger than the private market average.

Reikin buys nothing. It is an entry price, and it falls at exactly the rate at which bargaining power changes hands.

Renewal, the other surprise#

A standard Japanese lease runs two years. At the end of it, a good share of Kantō leases provide for a 更新料 (kōshinryō), one month's rent paid to extend for another two.

Its legality was challenged in court on the grounds that it amounted to an unfair term under consumer contract law. The Supreme Court ruled in July 2011: a renewal fee is not void in principle so long as the amount remains reasonable relative to rent and lease duration, and is clearly stipulated in the contract.

Here too usage is regional: kōshinryō is common in Tokyo, rare in Osaka, almost unknown in Hokkaidō.

The guarantor, and what replaced it#

A Japanese lease traditionally requires a 保証人 (hoshōnin), a personal guarantor, in practice a salaried Japanese relative. That requirement effectively excluded students on their own, elderly people without children, and foreign residents.

保証会社 (hoshō gaisha), private guarantor companies, took over from the 2000s: they stand surety in exchange for an initial commission and an annual fee, and pursue the tenant if rent goes unpaid. They are now required in most leases, even where a personal guarantor exists.

Access to housing remains unequal. A survey commissioned by the authorities in 2017 among foreign residents found that a substantial share had been refused explicitly on grounds of nationality. The housing safety net framework (住宅セーフティネット法), revised since, targets precisely the groups the private market pushes aside: the elderly, single-parent families, foreign residents.

The move-out inspection#

Shikikin is refundable, but its amount is the most frequent rental dispute in the country. The legal point is 原状回復 (genjō kaifuku), restoration to original condition.

Guidelines from the Ministry of Land, published in 1998 and revised in 2011, set the principle: ordinary wear from normal use and the ageing of the property are the landlord's cost, not the tenant's. A floor faded by sunlight or wallpaper yellowed by time cannot be deducted from the deposit. A cigarette burn or a hole in a partition can.

The reform of the Japanese Civil Code that took effect in 2020 wrote that rule into statute, ending years of case-by-case assessment.

FAQ#

Is reikin negotiable? Yes, especially off season. March, when job transfers and the academic year saturate the market, is the worst time to bargain; summer and winter are friendlier.

Is shikikin always returned? In principle yes, minus damage attributable to the tenant. Ordinary wear cannot be deducted since the 2020 Civil Code reform.

Can you rent without a guarantor? Rarely without going through a guarantor company, whose fee replaces the personal surety. The public UR stock is the exception and requires neither.

What do move-in costs come to in total? Four to six months of rent in the private market, less for a no-reikin flat, appreciably less in public housing.

Read alsoJapanese Housing: Decoding Mansion, Apāto and the 1K Code

Japanese housing types, from the 1K studio to the concrete "mansion", and what those words actually cover.

Sources and further reading#

• Ministry of Land, Infrastructure, Transport and Tourism (国土交通省), guidelines on restoration of rented dwellings, 1998 and 2011 revision
• Supreme Court of Japan, ruling of 15 July 2011 on lease renewal fees
• Japanese Civil Code, obligations law reform in force since 2020
• Urban Renaissance Agency (UR都市機構), rental terms for UR housing