Once you acquire real estate in Japan, one of the key decisions in the operational phase is whether to delegate property management to a professional firm or handle it yourself. Each approach has its own pros and cons, and the optimal choice depends on the property type and your investment goals. This article breaks down practical decision points, costs, and service coverage differences.

⸻

1. Overview of Delegated Management and Cost Estimates

By outsourcing to a management company, you can delegate

・Tenant recruitment (advertising, viewings)

・Lease contracts, renewals, and cancellations

・Rent collection and delinquency follow-ups

・Repairs and emergency response

・Move-out inspections and restoration

Typical cost is 3–5% of monthly rent, with an initial contracting fee equal to one month’s rent often charged.

⸻

2. Benefits and Risks of Self-Management

・Managing on your own can reduce management costs

・Give you direct oversight of tenant and property conditions

However, it comes with risks

・Time and effort needed for emergency or legal matters

・Risk of mishandling disputes or repairs

Self-management is especially unsuitable for those living far from the property.

⸻

3. Practical Decision Factors

Consider the following factors

・Is the property within 30 minutes by car from your residence?

・Is it a studio for single tenants or a family-size unit (which needs more complex support)?

・Do you own multiple units? (Outsourcing becomes more efficient with scale)

・Do you have another job or full-time occupation?

Short-term rentals like vacation lets or monthly leases usually require specialist support, making outsourced management strongly recommended.

⸻

Case Study

An owner of a 10-unit, 20-year-old 1K apartment in Chiba initially self-managed. But after struggling with site visits, rent tracking, and move-out inspections, they switched to a management firm in the second year. Though this added ¥400,000 annually in management fees, vacancy periods decreased, improving net return.

⸻

Takeaway

Whether to self-manage or delegate depends on factors like location, unit count, operational style, and available personal time. For remote or multi-unit properties, hiring a professional manager can lead to greater stability and optimized returns, making a cost-performance analysis a wise next step.