In Japan's aging society, renting properties to elderly tenants presents both risks and opportunities. While only 5% of rental properties are said to accept applicants aged 65 and older, elderly tenants offer the advantage of long-term occupancy. This article covers everything from countermeasures against solitary death, dementia, and rent arrears, to how to leverage this as a business opportunity.
The Current Reality: Why Elderly People Struggle to Rent
Approximately one in four elderly people has been turned down for a rental, and surveys show that in the Greater Tokyo area, the rejection rate is about 1.2 times higher than the national average. The main reasons for rejection are age, income, lack of a guarantor, and health condition. Meanwhile, about 60% of younger generations are unaware of this housing refugee problem.
Common Issues with Elderly Tenants and How to Address Them
Addressing the Risk of Solitary Death
In Tokyo's 23 wards, the number of people aged 65 and older who died alone at home reached 3,882 (in 2018). Effective countermeasures include regular wellness checks, using monitoring services, and taking out solitary death liability insurance. Some monitoring services are available for just a few hundred yen per month.
Addressing Dementia Risk
It is estimated that by 2025, 20% of people aged 65 and older will have dementia. Given the risks of hoarding, accidental fires, and neighbor disputes, it is important to contact family members and co-signers, share information with the property management company, and consult with local authorities.
Addressing Rent Arrears
Confirming contact details, preparing lease agreements with special clauses, and using a rent guarantee company are effective measures. If one guarantee company's screening is strict, it is advisable to apply to multiple companies.
What Are the Benefits of Accepting Elderly Tenants?
- Long-term occupancy can be expected: Fewer life events mean a lower likelihood of moving out
- Less pressure to lower rent: Low vacancy risk reduces the need for price reductions
- Fewer restoration costs: Lower tenant turnover reduces the frequency of restoration work
Key Points When Accepting Elderly Tenants
- Have a family member serve as a co-signer (if no guarantor is available, use a personal guarantee service)
- Consider taking out solitary death insurance (two types: "landlord-type" and "tenant-type")
- Make use of monitoring services (contact-based, non-contact, and in-person types)
- Research rent arrears consultation resources in advance
What Are Serviced Housing for the Elderly (Sakou-ju)?
Sakou-ju refers to barrier-free housing for the elderly that comes with safety confirmation and daily living consultation services. Units are generally 25㎡ or larger and equipped with a kitchen, flush toilet, and bathroom, with care-certified staff on-site during the day. For those who want to actively accommodate elderly tenants, operating a sakou-ju facility is one option to consider.
Frequently Asked Questions (FAQ)
Q. Is it illegal to turn down elderly applicants?
A. Under current law, there is no legislation that directly prohibits refusing tenancy on the basis of age; however, systems such as the registered housing program under the Housing Safety Net Act have been established to support housing access for the elderly.
Q. How much does solitary death insurance cost?
A. It varies by product, but landlord-type policies typically cost a few hundred to a few thousand yen per unit per month. Compare coverage details before enrolling.
Q. Can barrier-free renovation costs be deducted as expenses?
A. Yes. Barrier-free renovation costs for rental properties can be recorded as repair expenses.
