Buying a condominium may be a once-in-a-lifetime decision. Where should you start? What does the process look like until purchase? How long do the loan procedures take? It is only natural to have many questions. In this article, we explain the condominium purchase process and procedures clearly in four steps.
Condominium Purchase Process: What Are the Four Steps?
As a basic rule, a condominium purchase should move forward step by step, from Step 1 (gathering information) to Step 4 (contract, loan, and move-in). If you understand what needs to be done at each stage, you can proceed without rushing.
Step 1: Gather Information and Clarify Your Ideal Home
Start by gathering information. Use the internet and newspaper inserts to understand the market prices of new and pre-owned condominiums. As you listen to the wishes of your whole family and make your image of “what kind of home is ideal” more concrete, you will improve the accuracy of your next step, the financing plan.
Step 2: Create a Financing Plan
Once you decide, “We are going to buy a condominium,” create a financing plan. Thinking about how much you can pay in addition to your current rent and how to use bonus payments will help you see the approximate amount you can borrow. It is helpful to decide in advance on your base target purchase price and your acceptable upper limit (as a guide, your target price plus 3 million yen) so that property selection becomes smoother.
Step 3: Search for a Property
Look for properties in your preferred area. If the building is already completed, an on-site viewing is standard; if it is still under construction, visiting a model room is the usual approach. It is also important to walk around the surrounding area of the planned construction site in person.
It is not easy to find a property that matches all of your preferences for budget, size, location, and surrounding environment. When setting priorities, remember that “location convenience, such as being close to a station,” is generally valued more highly as an asset than “room size” or “the level of amenities”. If you are also considering a future sale or rental, prioritizing location is a rational decision.
Step 4: Application, Contract, Loan, and Move-In
Submitting a purchase application may require an “application deposit” (about 100,000 yen, refundable if you cancel). A few days later, the seller will provide an explanation of important matters, and if you are satisfied, you will move on to signing the contract and paying a deposit (5 to 10% of the property price). If there is anything unclear, make sure to confirm it before signing the contract. Canceling after the contract is signed will result in a penalty.
After that, you will proceed with the bank loan contract, inspection, and final payment before the property is handed over. Even if the building is already complete, you should expect the period from application to move-in to take about one month.
How Should You Set Priorities? Thinking About Budget, Size, and Location
One of the easiest things to struggle with in a condominium purchase is setting priorities. After understanding how real estate information works, use the following perspectives as a guide.
- If asset value is your priority, put “location (proximity to a station and transportation convenience)” first
- Consider “school district, commercial facilities, and access to your workplace” in line with your family’s daily rhythm
- “Size and amenities” can often be supplemented cost-effectively through renovation of a pre-owned property
Related Reading
- Do “off-market properties” really exist? An expert explains the mechanics of real estate information in depth
- Four essential rules to avoid overpaying in real estate investment: from proper rent evaluation to understanding leasing costs
- What AI real estate appraisal reveals about a home’s fair price: when to sell and how to sell at a higher price
FAQ: Common Questions About the Condominium Purchase Process
Q. How long does the entire condominium purchase procedure take?
Even if the property is already completed, it generally takes at least about one month from application to the completion of your move. For new properties that are not yet completed, it may take several months to more than a year before completion and handover.
Q. How much deposit should I prepare?
In general, 5 to 10% of the property price is a common guideline for the deposit. In addition, some cases require a separate application deposit (about 100,000 yen).
Q. When is the housing loan screening conducted?
In general, the formal screening proceeds after the sales contract has been signed. If you complete a preliminary screening in advance, the process after your purchase application can move more quickly.
Q. What is a reasonable upper budget range?
A common guideline is that your acceptable upper limit is about 3 million yen above your target price. For properties above that range, the monthly repayment burden becomes heavier, so you should review them carefully.
Q. What should I check when visiting a model room?
In addition to the layout, storage, natural light, view, and the quality of shared facilities, make sure to check the monthly management fee, the repair reserve fund, and the track record of the management company.
