[999] My Personal Investment Property No.1: Shinjuku One Room Apartment

Property Number: 001

Property Type: Apartment

Property Location: Kabukicho, Shinjuku-ku, Tokyo

Closest Subway Station: Higashi-Shinjuku Station

Property Size: 19㎡

Time of Purchase: August 2013

Purchase price: 8.5 million yen = 56,000 U.S. dollars

Current Status: Sold in 2020 for 15 million yen = 99,000 U.S. dollars

In May 2013, I first started to purchase real estate in Japan.

I have always had business income in Japan. Until then, all I did was put my income in the bank account and I had no intention of remitting it back to Taiwan and exchanging it for Taiwan dollars.

Buying a house in Japan for the first time was not so much an investment.

Simply, how should I put it…simply because I realized…

Why the hell was housing in Tokyo so cheap!!!!!!!!

Compared to Taipei or Shanghai, real estate in Tokyo is such a bargain!

With my business income, I was able to buy a property in Tokyo???!!!

Yup, that was my mentality at the time.

I bought my first investment property in Tokyo simply because I could.

At that time, I was unprepared and did not know the Japanese real estate and housing market.

Maybe it was a "compensation mentality" that made me act in a rush.

Even if I can’t afford Taipei and Shanghai, I can still afford Shinjuku!

Looking back, I was definitely rushing into the purchase. The property is located in Shinjuku, the heart of Tokyo.

At the time, location is the only good thing about this property that I know for sure.

I didn’t pay attention to the age of the apartment.

I didn’t pay attention to the investment return rate.

I didn’t calculate the cash flow.

I have no idea what the conditions inside the house were like.

I only found out about everything after buying it…lol

Oh well! What can I say? Live and learn.

At the time, I rarely did any research before investing in things.

Probably that’s why I had several other failed investments lol.

Before buying this property, I didn’t even know how to contact a Japanese real estate agency.

I worked with a Japanese real estate agency that had an office in Taiwan.

The Taiwan office handled all procedures related to the purchase for me.

The property for sale in Shinjuku was posted online to the public.

At that time, I was simply amazed by how cheap it was to the point that I seriously doubted whether the listing was real or not.

Below are some email exchanges between me and the real estate agency. I tried to negotiate the price but had no success.

What the contract looked like:

Part of me still doubted the whole transaction until the moment I received the title paper. Dang! It was real! Properties in Japan are indeed this cheap!

From then on, I put all my business income in Japan into buying real estate. But still, I was more thinking about accumulating properties as “savings” rather than “investments.” BTW, there’s no interest if you put money in your savings account in Japan. I never understood why Japanese people like to keep their money in the bank.

I sold my very first property in 2020 for 15 million Japanese yen.

The transaction was finalized in October 2020, so I held it for about 7 years.

The purchase price was 8.5 million yen.

The market price at the time of sale was approximately 15 million yen.

After deducting sales taxes and expenses, I received 12 million yen.

I made a small fortune from rental income and the differences between purchase and sales prices.

But the most intriguing thing is––

Among all my real estate investments, this apartment in Shinjuku is actually the worst in terms of capitalization rate and net rent yield!!!

When I first bought this Shinjuku apartment. I admit I was a bit all over the place.

I felt awesome about becoming a homeowner! A landlord!

Maybe it’s just my introverted personality, even when was feeling the excitement, I didn’t tell people around me.

And to be honest, this excitement faded within a week.

In the years to come, I only remembered this property as “my first property in Japan.”

Most of the time, all I can think of was––

“When the hell can it sell it!!”

Since its net rent yield is sort of low, I dreamed of selling it quickly so I could buy more properties with a much higher rent yield. Glad I finally sold it in 2020.

That is all the memory I have left of my first investment property in Japan. Did not lose money. Did not make much either given the changes in the value of yen.

My next purchase would be another apartment. Buying that property was the first time I began to think of properties in Japan as a great investment option.