The most common dispute when a tenant moves out of a rental property is who should bear the costs related to “restoration to original condition.” Japan’s Ministry of Land, Infrastructure, Transport and Tourism has published the “Guidelines for Troubles and Restoration to Original Condition,” clarifying the standards for cost allocation between landlords and tenants. Understanding these guidelines directly supports dispute prevention and more stable rental property management.
What Are the Restoration to Original Condition Guidelines?
The “Guidelines for Troubles and Restoration to Original Condition” are guidelines issued by the Housing Bureau of the Ministry of Land, Infrastructure, Transport and Tourism as reference material for lease agreements. They apply to private rental housing with rent at market-equivalent levels and set out reasonable standards for allocating restoration costs based on court precedents and transaction practice. They are commonly referenced when contract clauses are ambiguous or when disputes must be resolved at move-out.
What Is the Basic Concept of Restoration to Original Condition?
The guidelines define restoration to original condition as follows.
“Restoring wear or damage, among the decrease in building value caused by the tenant’s occupancy or use, that results from the tenant’s intentional act, negligence, breach of duty of care, or other use exceeding normal use”
The key point is that restoration to original condition does not mean returning the property to the exact state it was in when it was first rented. As a rule, age-related deterioration and wear from ordinary use are borne by the landlord.
The Difference Between Ordinary Wear and Special Damage
Fading of flooring or tatami caused by sunlight is classified as “ordinary wear,” so the landlord bears the cost. By contrast, scratches, stains, or breakage caused by the tenant’s fault are treated as “special damage” and must be paid for by the tenant.
What Problems Do Landlords Commonly Face?
The most frequent move-out dispute is overcharging the tenant. Problems arise when tenants are billed for ordinary wear or age-related deterioration that should properly be borne by the landlord. Failing to explain why the full security deposit is being withheld also leads to tenant dissatisfaction. Clearly itemizing restoration costs, such as wallpaper replacement, cleaning, and equipment repairs, is the foundation of dispute prevention.
What Practical Steps Help Prevent Disputes?
The guidelines recommend the following practical measures.
Confirm and Record the Property Condition at Move-In
It is important to treat restoration to original condition as a “move-in stage issue.” Before occupancy, confirm the presence or absence of wear through photographs and written records, and keep that record with the tenant present. This process clarifies responsibility at move-out.
Conduct the Move-Out Inspection with the Tenant Present
The move-out inspection should also be carried out with the tenant present. If special damage is found, the restoration obligation should be explained carefully. When both parties understand and accept the basis for cost allocation, the risk of dispute can be reduced significantly.
Alongside restoration procedures, it is also useful to refer to the complete guide to pre-move-in inspections so that consistent risk management can be maintained from move-in through move-out. It is also advisable to understand the rent reduction guidelines together with this topic.
Recommended Reading
- [Essential for Landlords] The Complete Guide to “Pre-Move-In Inspection” That Can Determine the Success of Rental Management
- What Are the Rent Reduction Guidelines? The Impact of the 2020 Civil Code Revision and How Landlords Should Respond
- How to Choose a Rental Property Management Company | 7 Points Landlords Should Prioritize
Frequently Asked Questions (FAQ)
Q. Do the restoration to original condition guidelines have legal binding force?
The guidelines themselves are not legally binding, but they are referenced in judicial decisions as an industry standard grounded in court precedents. Used together with the lease agreement, they can strengthen dispute prevention.
Q. Can you give specific examples of age-related deterioration and ordinary wear?
Sunlight-related discoloration of wallpaper and flooring materials, fading of tatami, and age-related deterioration of equipment are generally treated as ordinary wear and therefore borne by the landlord. In contrast, cigarette tar stains, scratches or odors caused by pets, and holes intentionally made in walls are borne by the tenant.
Q. Is an explanation required when restoration costs are deducted from the security deposit?
Yes, it is. As a rule, the security deposit should be returned, and if any amount is deducted, the basis for the deduction should be clearly stated in writing, including the damaged areas, repair details, and a breakdown of costs. This is fundamental to dispute prevention.
Q. Where can I obtain a move-in checklist?
The official website of the Ministry of Land, Infrastructure, Transport and Tourism publishes a “move-in and move-out checklist.” Even when using a property management company’s form, it is advisable to confirm that it aligns with the ministry’s format.
Q. Did the rules on restoration to original condition change under the old Civil Code and the 2020 Civil Code revision?
Under the revised Civil Code that came into effect in April 2020 (Article 621), the principle that ordinary wear and age-related deterioration are borne by the landlord was expressly codified. Even where special contractual clauses exist, they are limited to a reasonable scope.
