Tokyo Portfolio explains why Japanese housing is so cheap @TokyoPortfolio

Executive summary

Alex built Tokyo Portfolio around a gap in Japan’s traditional real-estate market: international clients often need English-language help, access to properties, and service tailored to expectations that mainstream agencies may not address. The business focuses on high-end residential and commercial real estate, with more emphasis on purchases than rentals. Its operating company is Blackship Realty.

The strategy combines a niche client base, a location near embassies and affluent expatriate neighborhoods, and Alex’s professional network. The longer-term ambition is to develop properties specifically suited to international buyers.

Strategy and operations

• Choose a differentiated niche. Alex initially saw unmet demand from people seeking homes in Tokyo’s Nakameguro area who did not speak Japanese. Tokyo Portfolio later concentrated on high-end residential and commercial properties for purchase and rent.
• Prioritize transaction value with a small team. Alex said the company has limited headcount, making higher-value transactions more attractive than handling a larger volume of lower-priced deals.
• Build around a defined customer base. Clients include diplomats and employees of large Japanese and foreign companies, particularly people in finance and other corporate roles. The company also serves international buyers looking for a second home or vacation property.
• Locate close to customers and referral sources. The office is in Hiroo, near Roppongi and several embassies. Alex said his existing embassy relationships helped make the location a natural fit.
• Use content to support the agency brand. Tokyo Portfolio began as a YouTube channel and website about three years before the interview; Blackship Realty was started with a business partner about two years before it. The channel showcases distinctive properties and helps raise the brand’s profile.
• Navigate a relationship-driven, old-school industry. Alex described a market where agents may need established networks to learn about or access properties. He cited routine fax use and said some listings cannot be promoted publicly. In many transactions, buyer and seller communicate through their respective agents rather than directly.
• Adapt service to local expectations and constraints. International clients may expect larger homes, multiple bathrooms, or higher interior specifications than the local market commonly offers. For instance, some embassies require one-bedroom housing of roughly 75–80 sqm, while a “nice” Tokyo one-bedroom may be only 55–60 sqm.

Frameworks and actionable playbooks

Niche-selection playbook

• Identify an underserved customer group—in Alex’s case, people seeking property in Tokyo without Japanese-language access.
• Focus on a segment where specialist knowledge and service can differentiate the agency.
• For a small team, favor higher-value transactions when they offer better returns on limited capacity.

Customer-acquisition and positioning playbook

• Build relationships with organizations that regularly need housing, such as embassies and large employers.
• Place the business near its target customers and referral network.
• Use property-focused content to demonstrate expertise and attract qualified prospects.

Japanese property purchase process, as described by Alex

1. Identify a property and agree on a price.
2. With cash, a buyer may be able to sign, pay, and receive the keys on the same day, provided the relevant checks and rights are handled as agreed.
3. With financing, the process is more paperwork-intensive. Permanent residency generally makes access to lenders easier; without it, the number of potential banks and the available terms may be more limited.
4. Alex advised clients to prepare all documents carefully and follow each bank’s instructions to avoid delays.

Negotiation playbook

• In Tokyo, expect limited room to negotiate: Alex estimated that a reduction of around 5% is often the maximum.
• Make a serious first offer at the amount you are genuinely willing to pay; do not assume the seller will negotiate toward a midpoint.
• Avoid extreme low offers, which sellers may treat as unserious or insulting.
• Alex said negotiation can be more open outside major cities, where sellers may expect a longer time to find a buyer.

Akiya and renovation due diligence

• Do not assume a very cheap or “free” house is a bargain; investigate why it is priced so low.
• Inspect in person or use a trusted local representative to check for leaks, uneven floors, structural issues, and other hidden repair costs.
• Check whether the property can be rebuilt, whether it meets current earthquake standards, and whether a bank will finance it.
• Alex noted that older properties—especially those predating the 1981/1984 earthquake-standard changes referenced in the interview—may be difficult to finance. He also cited access paths narrower than 2 metres as a potential barrier to rebuilding.
• Renovation can make older homes more attractive, but the cost, time, financing, and legal classification of the work need to be assessed before purchase.

Career advice

• Build strong spoken and written Japanese. Alex recommended proficiency around the high end of JLPT N2 to N1, because most communication with industry contacts will be in Japanese even if client-facing work is in English.
• He described immersion—using Japanese at home, school, and in daily life—as the most effective way he learned.

Market and operating metrics mentioned

• Tokyo’s average home size, combining apartments and houses: about 65 sqm (roughly 700 sq. ft.).
• Japan has an estimated 8 million vacant homes, according to the interview.
• Alex said Japanese people account for nearly 98% of the population, helping explain why rental conventions such as key money remain established.
• Tokyo Portfolio’s advertised rents range from roughly ¥200,000–¥400,000 per month to as high as ¥2.5 million per month.
• Alex said foreigner acceptance becomes more difficult in lower-priced rental segments:
  • Below roughly ¥150,000–¥180,000 for some properties—and below ¥200,000 for some two-bedroom homes—rejections become more common.
  • For rentals at ¥80,000 or less, he estimated that about 70% of properties may not accept foreign tenants.
• For buyers without permanent residency, Alex said only around three banks may consider an application, with less favorable loan terms in many cases. He gave 80% loan-to-value at 0.95% interest as an example of a possible pre-approval for an eligible buyer with permanent residency; this was illustrative, not a universal rate or offer.
• Alex estimated top-end construction costs at about US$600–$650 per sq. ft., describing this as the upper end of the Japanese market.
• A typical new-build timeline cited was 8–10 months from planning through handover. The renovation discussed by the host was expected to take about two months.

Product and market observations

• Alex characterized Tokyo as relatively affordable per square metre compared with major global cities, while emphasizing that prices vary substantially by neighborhood and property.
• Japan’s housing market has a surplus of homes rather than a shortage, but that does not mean every home is usable or easy to buy. Vacant homes may have financing, access, condition, or rebuilding limitations.
• He described a growing interest in renovating older properties as new-build prices rise, but said this is still developing in Japan.
• A mismatch exists between international clients’ expectations and common local housing stock: multiple bathrooms, larger bedrooms, stronger insulation, and upgraded kitchens and bathrooms can be hard to find.
• Alex said construction craftsmanship can be excellent while materials and finishes are comparatively modest, especially in less expensive properties. He attributed some of this to local buyers’ historical reluctance to pay more for housing interiors.
• He also noted that Japanese homes often lose value as buildings age, with buyers placing more value on land. This can discourage investment in renovation and preservation.

Growth plans

At the time of the interview, Blackship Realty was preparing to open another location in Hiroo, near a station. Alex also said the company wanted to move further into property development, addressing what he sees as a shortage of suitable homes for international buyers seeking investment properties, second homes, or vacation homes.

Financial performance: The interview did not disclose revenue, margins, customer-acquisition cost, conversion rates, or other company KPIs.

Presenters and source

• Toby — host of Unpacking Japan
• Alex — founder of Blackship Realty and creator of Tokyo Portfolio
• Source: Unpacking Japan interview, “Tokyo Portfolio explains why Japanese housing is so cheap”