You land in Tokyo. You start looking at condos. Two paths appear quickly: a glossy new tower (新築マンション) at ¥150 million, or a 1995 unit in the same ward at ¥65 million plus renovation. The price gap looks obvious. The actual math is not.
Most foreign buyers we see at RE : public underestimate the used-plus-renovation path — or overestimate it. Both errors come from missing line items. This article walks through what those line items are, what the numbers tend to look like, and where the risk sits.
The headline price is not the comparison
A new condo in central Tokyo sold by a major developer carries a premium. According to the Real Estate Economic Institute (不動産経済研究所), the average new condo price in the 23 wards crossed ¥100 million in 2023 and stayed there. Used condos in the same wards sit roughly 30–45% below that, depending on age and station distance.
But you are not comparing two prices. You are comparing two total cost of ownership stacks over your expected holding period. Here is what each stack actually contains.
New build stack
- Sticker price (developer margin baked in: typically 20–30%)
- Registration and acquisition tax (登録免許税・不動産取得税)
- Agent fee — often zero when buying directly from the developer
- Reserve fund initial lump sum (修繕積立基金), usually ¥300,000–¥800,000
- Monthly management fee + reserve fund (low at year 1, scheduled to rise)
- Property tax (固定資産税) — reduced for new builds for the first 5 years
- Furniture, curtains, AC units in some rooms
Used + renovation stack
- Sticker price (closer to land + structure value, less margin)
- Agent fee: 3% + ¥60,000 + consumption tax (the standard cap)
- Registration and acquisition tax (higher effective rate than new in some cases)
- Renovation cost (full scope: ¥150,000–¥250,000 per m² is a common range for a mid-spec interior rebuild; ¥300,000+ per m² for high-spec)
- Renovation loan or higher mortgage principal
- Monthly management fee + reserve fund (often already at the higher mature rate)
- Property tax (no new-build reduction)
- Temporary housing during construction (2–4 months typical)
When you line these up honestly, the gap narrows. Sometimes it closes. Sometimes used still wins by ¥20–40 million on a comparable floor plan in a comparable location. The point is: you cannot know without building both stacks.
The 1981 line and the 2000 line
Two dates matter more than any other number when you look at used stock in Japan.
1981 (新耐震基準). The seismic code was rewritten after lessons from the 1978 Miyagi earthquake. Buildings whose construction permit was filed on or after June 1, 1981 are built to the "new" standard. Pre-1981 buildings are "old standard" (旧耐震). Most Japanese banks will not lend on old-standard buildings, or will lend only on short tenors with high rates. Resale liquidity is also weaker. This is a hard line.
2000 (住宅性能表示制度 era and revised wood/RC detailing). A second tightening of seismic detailing came in 2000. For reinforced concrete condos the 1981–2000 cohort is generally financeable and insurable, but premiums for earthquake insurance differ, and the Ministry of Land, Infrastructure, Transport and Tourism (国土交通省) data shows measurable damage-rate differences between cohorts.
Practical take:
- Pre-1981: avoid unless you are paying cash and accept resale risk.
- 1981–2000: financeable, but inspect carefully. Reference estimates for renovation should assume some structural surprises.
- Post-2000: closest to new-build risk profile, often at 50–70% of new-build price.
What renovation actually costs in Tokyo (2024–2025 tendency)
Renovation pricing in Japan has moved up materially. Lumber, copper, labor, and logistics all rose. Foreign buyers working from 2018-era blog posts are using stale numbers.
Current reference estimates we see across Tokyo contractors:
- Surface refresh (cloth, flooring, water fixtures kept): ¥80,000–¥120,000 per m²
- Mid-scope rebuild (kitchen, bath, toilet replaced; layout untouched): ¥150,000–¥220,000 per m²
- Full skeleton renovation (スケルトンリフォーム — strip to concrete, redo plumbing, rewire, change layout): ¥250,000–¥400,000 per m²
- High-spec full reno (imported kitchens, custom millwork, underfloor heating): ¥400,000+ per m²
For a 70 m² unit, a full skeleton renovation at the mid-point of the range is roughly ¥21 million. Add design fees (10–15% if you use an architect), temporary housing, moving twice, and consumption tax. Budget ¥25 million realistically for a clean, modern, full-rebuild interior on a 70 m² plan.
Two cost drivers foreign buyers miss:
- Plumbing routing. Older Tokyo condos have concrete slabs without drainage voids underneath the unit (床スラブ直床). Moving a kitchen or bathroom can be physically impossible, or require raising the entire floor 100–150 mm.
- Management association rules (管理規約). Many buildings restrict floor-material acoustic ratings (LL-45 typical), construction hours, elevator protection, and weekend work. These are not negotiable. Read the rules before you design.
The hidden line: monthly fees over 30 years
This is the line foreign buyers miss most often.
A new condo's reserve fund (修繕積立金) starts low. Developers set it low to make the monthly burden look attractive at sale. The long-term repair plan (長期修繕計画) almost always has scheduled increases — often doubling or tripling by year 15.
A used condo from 1998 is already at the mature rate. What you see is what you pay.
Run a 20-year horizon:
- New build, ¥8,000/month reserve fund at year 1, scheduled rises to ¥24,000 by year 20. 20-year total: roughly ¥3.5–4.0 million.
- Used build (1998), ¥18,000/month reserve fund flat. 20-year total: roughly ¥4.3 million.
The new build is not as cheap on this line as it looks at year 1. And if the new building's reserve plan is underfunded — which we see frequently in tower condos with elaborate shared facilities — owners face a special assessment (一時金) later. Always read the long-term repair plan before signing, on either path.
Resale: the depreciation curve foreign buyers misread
Japanese condos depreciate. This is well known. What is less known is the shape of the curve.
Land Institute of Japan (日本不動産研究所) and REINS transaction data show a tendency:
- New-build premium drops 15–20% in the first 5 years.
- Years 5–20 see a gentler decline.
- Around years 20–25 the curve flattens for well-managed buildings in strong locations.
- Pre-1981 stock has a separate, weaker curve due to financing constraints.
What this means: if you buy new and sell at year 5, you eat the steepest part of the curve. If you buy a 20-year-old building and sell at year 30, you ride the flat portion. The renovation value itself is not fully recovered at resale — buyers in Japan typically discount your renovation to 30–50% of its cost, depending on age and taste alignment. Renovate for yourself, not for the next buyer.
Financing: where the two paths diverge
Mortgage availability is the underrated variable.
For foreign buyers without permanent residency, options narrow on both paths, but they narrow harder on used. Major megabanks (メガバンク) prefer:
- New build from a major developer
- Post-2000 construction
- Buyer with PR or spouse with PR, stable income in Japan, 2+ years tax filings
Used + renovation often requires:
- A combined purchase + renovation loan (リフォーム一体型ローン), which fewer banks offer
- Higher down payment (20–30% common vs 10–20% for new)
- Shorter tenor on older buildings (50 years minus building age, capped)
Run your financing before you fall in love with a unit. The interest rate and tenor difference can erase the headline price advantage of the used path.
When used + renovation wins, and when new wins
Based on the cases we review at RE : public, here is the rough tendency.
Used + renovation tends to win when you:
- Plan to hold 10+ years
- Want a specific layout that new builds do not offer (large LDK, home office, open kitchen)
- Are buying in an established central ward where new-build supply is thin and overpriced
- Have flexibility on construction timing and temporary housing
- Have financing lined up, ideally with PR or a Japanese co-borrower
New tends to win when you:
- Plan to hold under 7 years and accept the depreciation hit, or plan to hold 30+ and want zero renovation hassle
- Are time-constrained (relocation, visa-linked move-in date)
- Want developer warranty (10-year structural warranty under 住宅品質確保法) and predictable defects handling
- Are using corporate relocation support that covers new-build closing logistics
- Cannot or do not want to manage a contractor in Japanese
A simple comparison framework
Before you decide, fill in both columns honestly.
- Purchase price
- Acquisition tax + registration tax
- Agent fee
- Renovation cost (used only) — get two written quotes, not estimates from a portal
- Furniture and appliances delta
- 10-year management + reserve fund total (read the long-term plan)
- Expected resale value at year 10 (use REINS comparables, not developer projections)
- Mortgage interest paid over 10 years
- Temporary housing and moving (used only)
Sum each column. Then ask: which path leaves you with more capital, in the home you actually want, given your real holding period?
The answer is rarely the one the developer brochure suggests. It is also rarely "always go used." It depends on the specific unit, the specific building's repair plan, and your specific financing.
What we do at RE : public
We build that comparison for you, on the actual unit you are looking at. We pull the long-term repair plan, the management association minutes (理事会議事録), recent REINS comparables, and a contractor reference estimate for the renovation scope you are considering. The output is an analysis result, not a valuation. It is a second opinion before you sign.
This is not investment advice. The final decision is yours.