For owners and management companies that operate and manage rental properties in Tokyo, understanding the Rental Housing Dispute Prevention Ordinance (Tokyo Rule) is essential. Disputes over cost allocation at move-out are common in Tokyo, and a precise understanding of this ordinance can significantly reduce the risk of trouble.
What Is the Tokyo Rule (Rental Housing Dispute Prevention Ordinance)?
The Rental Housing Dispute Prevention Ordinance is an ordinance enacted by the Tokyo Metropolitan Government in 2004 to prevent disputes over restoring a property to its original condition at move-out. The background to its enactment was that about 40% of residents in Tokyo live in rental housing, and consultations and complaints regarding restoration at move-out had become frequent.
Under this ordinance, real estate brokers are required to provide tenants with a written explanation of the "Tokyo Rule" before entering into a lease contract, separately from the important matters explanation.
What Are the Main Points of the Tokyo Rule?
Rules for Cost Allocation at Move-Out
Age-related deterioration and wear from ordinary use: landlord's responsibility
The landlord is responsible for dirt and deterioration caused by the passage of time or normal use, such as wallpaper fading from sunlight or electrical burn marks.
Damage caused by intent, negligence, or use beyond ordinary wear: tenant's responsibility
Damage caused by the tenant's actions, such as torn wallpaper from pets, scratches from moving furniture, or corrosion caused by leaving water leaks unattended, is the tenant's responsibility.
Repair Costs for Equipment During Occupancy
Failure of essential equipment: landlord's responsibility
The landlord is responsible for repair costs for air conditioners, water heaters, and rain leaks that were installed when the tenant moved in. Because a tenant's self-arranged repair can lead to disputes, contacting the management company first is essential.
Damage caused by the tenant's intent or negligence: tenant's responsibility
Breakdowns such as water heater failure caused by dry firing, or damage to glass and mirrors caused by impact with objects, are the tenant's responsibility.
What Conditions Trigger the Tokyo Rule?
It applies when all three of the following conditions are met.
- Residential rental housing located in Tokyo (tenants, offices, and other non-residential uses are excluded)
- New lease contracts concluded on or after October 1, 2004 (renewals and existing contracts are excluded)
- Contracts concluded through brokerage or agency by a licensed real estate broker (private contracts between individuals are excluded)
Also, if the property is located in Tokyo, the obligation to explain the Tokyo Rule applies even when the brokerage is handled by a real estate broker outside Tokyo.
What to Do If a Dispute Occurs
Tokyo has the following consultation services in place.
- Real Estate Business Division, Bureau of Urban Development (Rental Hotline)：Move-out restoration issues and problems during occupancy
- Special Real Estate Transaction Consultation Office：Legal consultation with an attorney
If consultation and discussion do not resolve the issue, judicial procedures such as civil mediation, small claims litigation, and payment orders are available. Civil mediation typically takes about three months to reach a resolution.
Frequently Asked Questions (FAQ)
Q. Does the Tokyo Rule apply to all rental properties in Tokyo?
A. No. It applies only to residential rental housing under new contracts brokered or handled by a licensed real estate broker. Private contracts between individuals, offices, tenant spaces, and renewals of existing contracts are excluded.
Q. What happens if the owner does not provide the Tokyo Rule document?
A. The obligation to provide the document falls on the licensed real estate broker. If the rule is violated, the broker may be subject to administrative guidance or penalties. In contracts handled through a management company, the management company provides the document.
Q. Who bears the cost of wallpaper damage caused by pets?
A. The tenant bears the cost because it is damage caused by the tenant's actions. It is not considered age-related deterioration, but rather "damage beyond ordinary use."
Q. I was charged high repair costs at move-out. What should I do?
A. We recommend first consulting Tokyo's Rental Hotline or the Special Real Estate Transaction Consultation Office. You should also refer to the Ministry of Land, Infrastructure, Transport and Tourism's guidelines on disputes over restoration to original condition.
Q. Does the Tokyo Rule apply to properties outside Tokyo?
A. No. It is limited to properties located in Tokyo. For properties outside Tokyo, the ordinances of each prefecture and the national ministry's guidelines apply.
