Disputes over move-out restoration costs are one of the most common headaches for landlords who own rental property in Japan. Even though the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) has published detailed guidelines on the subject, disagreements about whether a particular scuff or stain was "already there when the tenant moved in" or "caused by the tenant during the tenancy" remain a persistent source of friction on the ground. For readers coming from a security-deposit system such as the one used in the United States or the United Kingdom, it helps to know up front that Japan's practice, known as genjo kaifuku (原状回復, literally "restoration to original condition"), is a distinct legal and cultural framework rather than a simple translation of "returning the deposit." The single most effective way to prevent these disputes is to carry out a thorough inspection of the unit before the tenant moves in and to keep careful records of what you find.
In this article, INA&Associates Inc. walks property owners through a concrete pre-move-in checklist for preventing restoration disputes, along with the underlying logic for allocating repair costs between landlord and tenant. Running a rental business successfully means avoiding emotional standoffs and instead relying on objective, well-documented facts. We hope this article helps make your rental operations smoother and more profitable.
Consumer affairs bodies and local consumer centers in Japan continue to receive tens of thousands of complaints every year concerning security-deposit and restoration disputes in rental housing, so this is not a hypothetical risk for any Japanese landlord. Disagreements over move-out repair charges sometimes escalate all the way to small-claims litigation or court-annexed mediation, and the time and emotional toll of that process can be substantial — arguably heavier, in relative terms, than the equivalent small-claims disputes that arise under a US or UK deposit-protection scheme, precisely because Japan's system relies so heavily on documented evidence rather than a fixed, itemized deduction list. Taking the right steps from the very start of the tenancy, before the keys are even handed over, is therefore a genuine business decision with real financial stakes.
The Current State of Restoration Disputes and Their Root Causes
Most restoration disputes arise from a mismatch between the parties' understanding of the unit's condition at move-in and at move-out. This is especially true after a long tenancy, when it becomes difficult to tell whether a mark is ordinary wear from the passage of time or damage caused intentionally or negligently by the tenant. If the condition of the unit was never accurately documented at move-in, it becomes very hard for a landlord to rebut a tenant's claim that "the damage was already there before I moved in."
To avoid this situation, it is essential to record the unit's condition objectively before move-in and to share that record with the incoming tenant. Below, we summarize the areas that most often become flashpoints, along with why they tend to cause disagreement.
Trouble Spots and Their Underlying Causes
| Area | Common Cause of Dispute | Typical Landlord Position | Typical Tenant Position |
|---|---|---|---|
| Wallpaper (cross vinyl wall covering) | Discoloration from sunlight, tobacco tar staining, thumbtack holes, marks left by furniture | Caused by tenant negligence | Ordinary aging or normal wear and tear |
| Flooring | Drag marks from furniture, caster wheel marks, sun discoloration | Caused by tenant carelessness | Pre-existing damage, or normal wear and tear |
| Wet areas (kitchen and bathroom) | Mold, hard-water scale, grease stains | Caused by inadequate everyday cleaning | A structural problem such as poor ventilation |
| Fixtures (doors and screen doors) | Malfunction, tears, scratches | Caused by rough handling by the tenant | A defect caused by ordinary aging |
To prevent these disputes, it is critical to record the unit's condition accurately before move-in and to make that record available to both parties. Leaving behind objective evidence makes the move-out conversation go far more smoothly.
The Pre-Move-In Checklist: Key Points to Verify
A pre-move-in inspection should not be a quick visual glance — it needs to be carried out systematically using a checklist. Below we summarize the key points that a landlord should verify.
1. Overall Interior Inspection
Start by looking over the entire unit for any noticeable scratches or stains. Wallpaper peeling or staining and flooring scratches in particular tend to become sources of dispute after move-in, so inspect these carefully.
Photographic and video documentation is essential. Make sure the date and time are recorded, and photograph both the room as a whole and close-ups of anything that stands out. Shooting in natural light makes scratches and stains easier to see. A smartphone camera is perfectly adequate, but it is worth double-checking that the timestamp metadata setting is turned on so the capture date is preserved.
2. Testing Fixtures and Equipment
Confirm that the air conditioner, water heater, ventilation fans, and other built-in equipment are working properly. Actually powering each unit on and testing it is important, since it prevents a tenant from later claiming "it was already broken when I moved in." Also check that accessories such as instruction manuals and remote controls are present.
Ideally, this equipment check should be carried out with the incoming tenant present. If something is found to be malfunctioning before move-in, either complete the repair before handover or notify the tenant of the defect in writing, so that any later dispute can be avoided.
3. Checking the Condition of Wet Areas
The kitchen, bathroom, and toilet are prone to mold and hard-water buildup, making them common trouble spots. Check for clogged drains, leaks, and worn gasket seals. Storage spaces that are easy to overlook, such as under the sink or under the vanity, should also be checked for signs of past leaks.
When it comes to mold in wet areas, some tenants argue that it appeared "because ventilation was inadequate," while others argue "it's a structural issue with the building." Photographing the pre-move-in condition makes it much easier to prove that any mold found later actually developed during the tenancy.
4. Testing Fixtures and Sashes
Confirm that doors, windows, and screen doors open and close smoothly. If a door or window is sticking, adjusting it before move-in prevents complaints later. Also inspect screen doors for tears and window glass for cracks, and repair these as needed before the tenant moves in.
Pre-Move-In Checklist: Full List of Items to Verify
| Category | Item to Check | Verification Method |
|---|---|---|
| Overall interior | Wallpaper peeling, staining, or scratches | Visual inspection and photographs |
| Overall interior | Flooring scratches, stains, or discoloration | Visual inspection and photographs |
| Overall interior | Ceiling stains or dirt | Visual inspection and photographs |
| Fixtures and equipment | Air conditioner operation (heating and cooling) | Power on and test directly |
| Fixtures and equipment | Water heater operation | Run hot water and confirm |
| Fixtures and equipment | Ventilation fan operation | Power on and test directly |
| Wet areas | Drain clogs or odors | Run water and confirm |
| Wet areas | Leaks (under sink, under vanity) | Visual inspection and photographs |
| Wet areas | Mold and hard-water scale | Visual inspection and photographs |
| Fixtures and sashes | Door open/close operation | Open and close to confirm |
| Fixtures and sashes | Window and sash open/close operation | Open and close to confirm |
| Fixtures and sashes | Screen door tears and operation | Visual inspection and open/close test |
How Cost Allocation Works Under the MLIT Guidelines
Restoration cost allocation in Japan is governed by the standard set out in the MLIT's "Guidelines on Disputes Concerning Restoration to Original Condition." Under these guidelines, repair costs arising from ordinary aging or normal wear and tear are the landlord's responsibility, while repair costs arising from the tenant's intentional acts or negligence are the tenant's responsibility. Readers familiar with the US or UK concept of "normal wear and tear" being excluded from what a landlord can deduct from a security deposit will recognize the underlying logic immediately — the difference is that in Japan this principle is spelled out in a detailed national administrative guideline with reference tables, rather than left mainly to statute, case law, and the practice of individual deposit-protection schemes.
The guidelines were created because move-out restoration disputes had become a genuine social problem in Japan. In particular, cases in which landlords billed tenants for excessive repair costs were seen as a significant issue, and the standard was developed from a tenant-protection perspective — much like the way many US states and UK tenancy-deposit schemes have moved toward requiring landlords to itemize deductions and prove that a charge reflects genuine damage rather than routine upkeep. For a landlord, understanding these guidelines correctly and knowing the proper scope of cost allocation is the foundation of trustworthy rental management.
The Basic Principle of Cost Allocation
| Who Pays | Applicable Situation | Concrete Examples |
|---|---|---|
| Landlord's responsibility | Ordinary aging, normal wear and tear | Sun-discolored wallpaper, a dent in the flooring from furniture placement, natural failure of equipment |
| Tenant's responsibility | Intentional acts, negligence, breach of the duty of care | Tobacco tar stains, pet-caused scratches, mold caused by neglecting routine cleaning |
Useful Life and the Tenant's Share of the Cost
Under the guidelines, a useful life is assigned to each type of fixture or interior finish, and the tenant's share of the repair cost decreases as the length of the tenancy increases. For example, wallpaper is assigned a useful life of six years; if the tenant has lived in the unit for six years or more, even damage caused by the tenant's own negligence is valued at a tenant cost of just one yen (or the item's residual value) — in other words, effectively nothing. This is a striking contrast with a security-deposit system where wear items are typically not assigned a formal depreciation schedule at all; landlords should understand this useful-life logic clearly and take care never to bill a long-term tenant as though the wallpaper were brand new.
| Fixture / Interior Finish | Approximate Useful Life | Approx. Tenant Share After 3 Years | Approx. Tenant Share After 6 Years |
|---|---|---|---|
| Wallpaper (cross vinyl wall covering) | 6 years | About 50% | Nearly 0% (residual value of 1 yen) |
| Carpet / tatami mats | 6 years | About 50% | Nearly 0% (residual value of 1 yen) |
| Flooring (partial repair) | Follows the building's own useful life | Decreases with years elapsed | Decreases with years elapsed |
Concrete Measures for Preventing Disputes
Beyond using a pre-move-in checklist, here are several concrete measures that help prevent restoration disputes.
1. Preparing and Signing a Condition Report
It is worth preparing a "condition report" that summarizes the results of the pre-move-in inspection, reviewing it together with the tenant, and obtaining both parties' signatures and seals. This creates a documented agreement about the unit's condition at move-in, and it can dramatically reduce disputes at move-out. Attaching photos or video data to the condition report makes it an even more reliable piece of evidence — functioning, in effect, as a Japanese analogue to the check-in inventory report used in many UK tenancies.
We recommend preparing your condition report with reference to the "Sample Checklist for Verifying Property Condition and Restoration at Move-In and Move-Out," published by MLIT. This sample provides fields for recording the areas to inspect and whether any wear is present, and it is a practical format that can be used at both move-in and move-out.
2. Recording Special Provisions in the Lease Agreement
If you intend to allocate costs differently from the guideline's default principle, that arrangement must be spelled out as a special provision in the lease agreement. However, for a special provision to be treated as valid, the tenant must have fully understood its content and agreed to it.
For example, if you want to include a special provision stating that "the cost of professional move-out cleaning is the tenant's responsibility," you need to explain this carefully at the time of contracting and obtain the tenant's written consent. A one-sided provision that unfairly disadvantages the tenant, or one that departs significantly from the guidelines, carries a real risk of being ruled invalid in court, so the reasonableness of the content deserves careful consideration.
3. Regular Property Walkthroughs and Communication
Conducting regular walkthroughs during the tenancy, and checking the condition of common areas and tenant conduct, helps nip potential problems in the bud early. Building good communication with tenants is also important, because it encourages them to report equipment problems promptly rather than letting them fester.
Building a relationship of trust ultimately contributes to preventing disputes. Creating an environment where tenants feel comfortable is also an important factor in encouraging longer tenancies, which in turn helps reduce vacancy risk.
Conclusion: Preparation Up Front Determines Success in Rental Management
Restoration disputes place a real time and emotional burden on landlords, and they can also hurt profitability. However, thorough pre-move-in inspection and documentation, combined with appropriate handling based on the guidelines, can prevent these disputes before they ever start.
Below is a summary of the key points covered in this article.
| Measure | Concrete Action | Expected Effect |
|---|---|---|
| Use a pre-move-in checklist | Systematically inspect the overall interior, fixtures, wet areas, and doors/sashes | Objectively understand and document the unit's condition at move-in |
| Document with photos and video | Photograph the whole room and any notable spots with a timestamp | Provides evidence usable at move-out |
| Prepare a condition report | Confirm and sign it together with the tenant | Establishes agreement on the move-in condition |
| Understand the guidelines | Accurately grasp useful-life schedules and cost-sharing ratios | Ensures appropriate billing and prevents unfair charges |
| Spell out special provisions | State them clearly in the contract and explain them to the tenant | Secures the validity of the special provision |
| Conduct regular walkthroughs and communication | Check the property's condition periodically during the tenancy | Enables early detection and prevention of problems |
Rental management is not simply a matter of renting out space — it is a business built on providing tenants with a comfortable place to live. Never neglecting up-front preparation and proper management, and building good relationships with tenants, is the shortest path to stable, long-term operations. We encourage you to put the pre-move-in checklist introduced in this article to use, and to run a smooth rental business free of disputes.
If you have any questions or concerns about property management, we warmly invite you to join INA Network. Members of INA Network who follow our community guidelines can expect an answer to every question they raise. We are committed to supporting your rental business with everything we have.
Frequently Asked Questions (FAQ)
Q1. Is it fine to take the pre-move-in photos with a smartphone?
Yes, a smartphone is completely fine for this purpose. What matters more than image quality is being able to clearly establish "when" and "where" each photo was taken. Make sure your timestamp setting is turned on, and photograph both the room as a whole and close-ups of anything noteworthy. Saving the files to cloud storage is also worthwhile, since it protects you against data loss.
Q2. What should I do if the tenant refuses to sign the condition report?
You cannot force a tenant to sign, but even without a signature, photos and video that the landlord has recorded remain valid evidence. Continue to explain patiently that the condition report exists to prevent disputes for both sides, and try to build the tenant's understanding. It is also worth keeping a record of the fact that the tenant declined to sign.
Q3. Do the MLIT guidelines carry legal force?
The guidelines themselves are not legally binding, but they were compiled based on past court decisions and function in practice as a powerful standard. Because a claim that departs from the guidelines is unlikely to hold up if the matter goes to court, it is important to keep your practice aligned with them.
Q4. What is the difference between ordinary aging and normal wear and tear?
Ordinary aging refers to natural deterioration that occurs simply with the passage of time (for example, sun-discolored wallpaper). Normal wear and tear refers to unavoidable marks or dirt that result from ordinary daily living (for example, a dent in the flooring from furniture placement). In principle, both are the landlord's responsibility. Careful documentation before move-in is essential precisely because it is what allows these categories to be clearly distinguished from damage caused by the tenant's intentional acts or negligence.
Q5. Should a landlord always attend the move-out walkthrough in person?
To prevent disputes, we recommend attending the move-out walkthrough in person whenever possible. Reviewing the unit's condition together with the tenant and reaching agreement on the spot about which items need repair helps avoid later "he-said, she-said" disagreements. During the walkthrough, comparing the current condition against the photos taken before move-in makes it much easier to reach an objective judgment.
