Choosing a Property Management Company (kanri gaisha) for Rental Properties: Fees, Contracts, and Red Flags
A guide to choosing a property management company (kanri gaisha) in Japan: comparing fees, kanri itaku vs. sublease contracts, tenant-placement KPIs, and red flags to avoid.
Aug 7, 2026·✍️ olablog·⏱ 13 min read
A guide to choosing a property management company (kanri gaisha) in Japan: comparing fees, kanri itaku vs. sublease contracts, tenant-placement KPIs, and red flags to avoid.
If you own—or are considering investing in—an apartment or house in Japan for rental purposes, managing it yourself (collecting rent, handling repairs, and finding new tenants) is almost an “impossible task” if you are not familiar with the law or have a demanding full-time job. Many Vietnamese people living in Japan who enter the real estate market often fall into the “low fees” trap or place complete trust in promises made by the original real estate agent.
However, choosing the wrong property management company (管理会社 - kanri gaisha) can do more than cause your property to deteriorate quickly—it can also drag down your cash flow. This article from OlaChill breaks down every key aspect, from fees and contract structures to tenant-placement performance standards and the “red flags” (warning signs) you should watch for, so you can deal with Japanese companies with confidence.
1. Why does choosing the right kanri gaisha determine 80% of your success as a landlord?
In Japan’s rental property investment model, the landlord (オーナー - ōnā) mainly provides the capital and makes major decisions. The entire day-to-day operation depends on the property management company (管理会社 - kanri gaisha).
A professional kanri gaisha will help you:
- Maintain a high occupancy rate (入居率 - nyūkyōritsu).
- Control the risk of unpaid rent (家賃滞納 - yachin tainō), as well as noise, garbage, and other problems with neighbors.
- Optimize the cost of restoring the property to its original condition (原状回復 - genjō kaifuku) whenever a tenant moves out.
By contrast, if you choose an underperforming company, your property may remain vacant for months, repair costs may be inflated, and complicated legal disputes may arise when you terminate the contract.
2. Comparing 3 common rental property management models in Japan
Currently, property management companies in Japan offer 3 main types of arrangements. You need to understand the nature of each one clearly so you do not confuse their costs and scope of authority.
2.1. Rent collection services (集金代行 - Shūnō daikō)
This is the most basic form of management. The property management company only collects rent from tenants, reconciles the accounts, and transfers the money to your account each month. Other tasks—such as handling complaints, dealing with plumbing or electrical problems, cleaning common areas, and inspecting the property when a tenant moves out—must be handled by the landlord or paid for separately each time.
2.2. Full management outsourcing (管理委託 - Kanri itaku)
This is the most common model, accounting for more than 80% of individual landlords in Japan. Under this arrangement, the property management company handles almost everything on your behalf: collecting rent, sending payment reminders, dealing with emergencies 24/7, renewing contracts (更新手続き - kōshin tetsuzuki), inspecting the property when tenants move out (退去立会い - taikyo tachiai), and planning repairs.
2.3. Full sublease / Vacancy guarantee (サブリース - Sublease)
Sublease, also known as a full-property re-rental agreement (一括借り上げ - ikkatsu kariage), involves the property management company renting your entire house or apartment from you at approximately 80% - 90% of the market rate, then finding tenants and re-renting it themselves. Whether the property is vacant or a tenant defaults on rent, you still receive a fixed monthly payment. However, this model carries hidden risks, particularly clauses allowing the rent to be reduced periodically over time.
Comparison table of 3 management models (Data updated as of August 2026)
| Criteria | 集金代行 (Shūnō daikō) | 管理委託 (Kanri itaku) | サブリース (Sublease) |
|---|---|---|---|
| Monthly management fee | ~3% of the rent | 3% – 5% (5% + tax is most common) | 10% – 20% discount on the rent |
| Scope of services | Rent collection, bank transfers | Rent collection, tenant placement, emergency response, renewals, move-outs | Guaranteed fixed income, full management handled by the company |
| Vacancy risk (空室リスク) | 100% borne by the landlord | 100% borne by the landlord | Borne by the management company |
| Peace of mind | Low (landlord handles many tasks) | High (professional and transparent) | Moderate (rent-reduction disputes can easily arise) |
| Best suited for | People with plenty of time who live near the property | Most Vietnamese landlords in Japan | Buyers with high loan-to-value financing who fear losing cash flow |
3. Detailed management costs and additional fees (As of August 2026)
Many new landlords focus only on the question, “What percentage is the monthly management fee?” and overlook other additional charges. Here is the full financial picture you need to understand:
Total amount collected from the tenant = Rent (家賃 - yachin) + Common service/management fee (共益費/管理費 - kyōekihi/kanrihi)
3.1. Monthly management fee (管理手数料 - Kanri teshūryō)
- Standard rate: As of August 2026, the standard management fee in the Japanese market remains at 5% of the monthly rent (+ 10% consumption tax 消費税 - shōhizei).
- Specific example: An apartment in Tokyo rented for 100,000 JPY/month (
17.000.000 VND). A 5% management fee is 5,000 JPY + 10% tax (500 JPY) = 5,500 JPY/month (935.000 VND). The landlord receives 94,500 JPY.
3.2. New tenant-placement fee (広告料 - Kōkokuryō / AD fee)
When an apartment becomes vacant, the property management company posts the listing on its systems to find a tenant. This tenant-placement incentive, commonly abbreviated as AD (Advertising Fee), is paid by the landlord to the agent who brings in the tenant.
- Fee: Usually 1 - 2 months’ rent (before tax), depending on the property’s location and how difficult it is to find a tenant.
3.3. Contract renewal processing fee (更新事務手数料 - Kōshin jimu teshūryō)
In Japan, rental contracts generally have a 2-year term. When tenants renew, they commonly pay 1 month’s rent as a renewal fee (更新料 - kōshinryō). The property management company receives 0.5 to 1 month’s rent for handling the renewal paperwork.
3.4. Move-out inspection and restoration planning fee (退去立会い・原状回復)
When a tenant moves out, the kanri gaisha sends a staff member to inspect the property’s condition (退去立会い - taikyo tachiai), calculate the portion the tenant must compensate for, and determine the portion the landlord must cover under the guidelines of Japan’s Ministry of Land, Infrastructure, Transport and Tourism (MLIT). Some companies charge a flat fee of 10,000 – 30,000 JPY (~1,7 – 5,1 triệu VND) for each inspection if it is not included in a full-service package.
4. Core KPIs for evaluating tenant-placement capability (Kyakuzuke)
A management company charging a low 3% fee but leaving your property vacant for 4 months will cost you far more than a company charging 5% but finding a tenant within 2 weeks. When choosing a company, evaluate its tenant-placement capability (客付け力 - kyakuzukeryoku) using these 3 KPIs:
KPI 1: Occupancy rate (入居率 - Nyūkyōritsu)
- Standard: Reputable companies in major cities (Tokyo, Osaka, Nagoya, Fukuoka) consistently maintain occupancy rates above 95% - 98%.
- Note: Ask whether this rate is calculated across the entire company’s portfolio or only for the area where your property is located.
KPI 2: Vacancy period (空室期間 - Kūshitsu kikan)
- Standard: On average, no more than 30 - 45 days from the time the previous tenant moves out until the new tenant moves in, including the restoration period 原状回復 - genjō kaifuku.
KPI 3: Coverage across real estate advertising channels
Does the property management company promise to list your property on the following channels?
- REINS (レインズ): The nationwide real estate information network for property agents.
- Major consumer portals: SUUMO, HOME'S, at home.
- Partner networks supporting foreign residents: If your apartment accepts foreign tenants (外国人可 - gaikokujin ka), does the kanri gaisha work with foreigner-friendly guarantor companies (保証会社 - hoshō gaisha) such as GTN, EPOS, or Casa?
5. Contract termination clauses (Kaiyaku jōken) and legal traps to avoid
Many Vietnamese landlords end up in a “paying dearly for poor service” situation when they want to switch management companies but are tied down by an overly restrictive contract.
Notice period for contract termination (解約予告期間 - Kaiyaku yokoku kikan)
- Under common practice in Japan, the notice period for terminating a management contract (解約予告 - kaiyaku yokoku) is usually 1 to 3 months.
- Red flag to avoid: A contract requiring as much as 6 months to 1 year advance notice, or one that renews automatically (自動更新 - jidō kōshin) without a flexible cancellation window.
Early termination penalty (解約違約金 - Kaiyaku iyakukin)
- Some kanri gaisha insert a clause stating: “If the contract is terminated within the first 1-2 years, the landlord must pay compensation equivalent to 2 - 3 months of management fees.”
- Advice: Negotiate to remove this penalty or reduce it to a maximum of 1 month’s management fee if the company fails to meet its promised KPIs.
6. 5 Red Flags for identifying a low-quality property management company
When speaking with a kanri gaisha and reviewing its contract, if you encounter 1 of the 5 signs below, you should stop immediately:
- Ultra-low management fee (1-2%) but reduced services: You may easily be charged exorbitant additional fees whenever a tenant calls to report a breakdown or minor problem.
- No transparent, regular financial reporting: The company does not send an income-and-expense statement (rent collected, management fees deducted, repair costs) on the agreed date each month.
- The property is listed only on internal channels and not on REINS: The company deliberately “holds” the listing to keep both sides of the commission (known as 囲い込み - kakoikomi), causing your property to remain vacant longer.
- Unusually high repair estimates (リフォーム - rifōmu): The management company inflates the cost of repairs, repainting walls, or replacing bathroom fixtures to 1.5 - 2 times the market price in order to profit from subcontractor markups.
- Slow customer support: When you message or call with a question, you have to wait 2-3 business days for a vague reply.
7. 6 questions to ask a kanri gaisha before signing
Before signing a property management outsourcing agreement (管理委託契約書 - kanri itaku keiyakusho), prepare these 6 questions to “test” how professional the company is:
- “What has the 入居率 (occupancy rate) been in the area around my apartment over the past 6 months?”
- “When the property is vacant, which systems will you list it on (REINS, SUUMO, HOME'S), and how soon after taking on the property?”
- “What is your process for handling emergency problems, such as water leaks or a broken air conditioner, at night and on public holidays?”
- “Which guarantor companies (保証会社 - hoshō gaisha) do you work with to screen applications from foreign tenants?”
- “What is the maximum amount for minor repairs that the company can approve without asking me?” (It is generally advisable to set this below 10,000 – 20,000 JPY).
- “How much advance notice is required under the contract termination clause (解約条件 - kaiyaku jōken), and are there any penalties?”
Frequently Asked Questions
Q. I am Vietnamese and live in Vietnam. Can I purchase a property in Japan in my own name and hire a property management company?
A. Absolutely. Japanese law does not restrict foreigners from purchasing real estate. However, you must have a professional property management company in Japan handle operational procedures on your behalf, and you may need to authorize a tax representative (納税管理人の designation) in Japan.
Q. If the tenant stops paying rent (家賃滞納), will the property management company compensate me?
A. Under a standard Kanri itaku agreement, the property management company is not obligated to compensate you. However, 99% of rental contracts in Japan today require tenants to purchase guarantor insurance (保証会社 - hoshō gaisha). If a tenant falls behind on rent, the guarantor company will pay you 100% of the rent owed.
Q. Can the 5% property management fee be negotiated down?
A. If you own only 1 individual apartment, negotiating a lower fee can be difficult. However, if you own an entire building (一棟 - ittō) with 6-10 units or more, you can certainly negotiate the management fee down to 3% – 4% + tax.
Q. Can I manage the property myself (自主管理 - jishu kanri) to save the 5% fee?
A. You can certainly manage it yourself if you are fluent in Japanese, understand the Act on Land and Building Leases (借地借家法 - Shakuchi shakkyahō), live near the apartment, and have time to handle emergencies 24/7. However, if a breakdown occurs in the middle of the night or a dispute arises when a tenant moves out, not using a professional company will cost you a great deal of time and effort.
Conclusion
Choosing a property management company (kanri gaisha) in Japan is an important decision that determines your actual returns and peace of mind as an investor. Do not focus only on the 3% or 5% monthly management fee. Evaluate the company’s overall tenant-placement capability, the transparency of its financial reporting, and the flexibility of its contract terms.
If you would like to learn more practical tips about life, finances, and housing in Japan, be sure to check out these other useful articles on our website:
- Learn more about daily life and administrative procedures at OlaChill Blog.
- Explore practical guides and daily-life services at OlaChill.
- If you have relatives who have recently moved to Japan and want to relax on a weekend, check out these Day Tours from Tokyo with attentive Vietnamese-speaking guides.
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