It is important to understand all the nitty-gritties while taking an apartment for rent in Japan. These nitty-gritties include the lease renewal also. The fee paid by the tenant to extend the leasing agreement, which is sometimes included in the rental contract in Japan, is known as Lease Renewal Fee.
Usually, a person can take an apartment for rent in Japan for two years after which the tenant has to get the lease agreement renewed. It is important to understand that taking a lease renewal fee is a common practice in Japan, but there is no particular law which makes it mandatory in the rental contract.
However, tenants can negotiate with the landlord in regards with the lease renewal fee removal if he plans to stay in the same apartment for rent in Japan for more than two years.
The reason behind Landlords Charging Lease Renewal Fee
The major reason behind the lease renewal fee is that landlords get a lump sum amount in a one shot which they would get per month as monthly rent. This also helps in keeping the advertised monthly lower by one-twenty fourth.
Is it important to Pay Lease Renewal Fee?
Despite not being a common practice, tenants have to pay the lease renewal fee to the landlord if they have signed the rental contract which has a mention of it. The Supreme Court of Japan has also even issued orders on July 15, 2011, that the landlord is liable to pay the lease renewal fee if it is stated in the rental contract.
The lease renewal fee can be charged by the landlords who are letting their apartment for rent in Japan, but it completely depends on the tenant whether he wishes to sign the contract which has the mention of lease renewal fee or not.
In simple words, if a tenant doesn’t sign the rental contract with the mention of lease renewal fee, then no one can force him to pay that. Apart from this, even if the tenant has signed the contract which states that he has to pay the lease renewal rent he still has an option with him where he can give a month’s notice to the landlord and terminate the lease.
What are other fees besides the renewal fee for renewal of lease?
Insurance- Usually insurances are paid each two years so you will also have to renew the insurance.
Guarantor company fee-Usually guarantor company fee is around 10,000yen per year from second year of the lease.
24 Hours Support-If you paid for 24hours support in the beginning when you moved out, this fee will also be applied.