If you’ve ever thought about buying a car in Japan, this guide could help you with the essential steps you need to take to get your new set of wheels without hiccups.
Buying a car in Japan
After a few years of taking public transportation and beginning to feel like the 15-minute bike ride to the station was a hassle, our family decided it was time to get a car. We also had other crucial factors that convinced us to buy a car, which, I believe, is the first step to getting a car in Japan.
Owning a car is not so much a need here, compared to other countries where you can only get anywhere with one. Public transportation is efficient, and commuting is the way to go if you don’t often miss the last train, thus forcing you to break the bank by taking a taxi. However, if a cost-benefit analysis shows that getting a car outweighs the cons, read on.
Is it easy to buy a car in Japan?
Let me first explain that it was rather easy for us to get a car because of my Japanese nationality. When my foreigner husband tried to apply for a car loan, he wasn’t approved, mainly because he was currently in between jobs at that time, making financial stability one of the factors that make or break your loan application. Of course, you can also just go in a dealer and pay cash upfront. There are reliable cars for under ¥300,000 if you’re after something that will get you from point A to B and not looking to buy a dream car or something more luxurious.
We have non-Japanese friends who also had no problems buying cars, so the entire process isn’t so complicated as long as you meet the crucial requirements (more on this later).
Other alternatives to owning a car
Although getting our car loan approved was easy, we took quite some time considering all other options. For example, you can choose to rent a long-term car instead of owning one, like Toyota’s Kinto service. It is a car subscription service, putting all the nitty-gritty details on the dealer while you just enjoy having a car, albeit at a more expensive price. What’s more, you don’t actually own the car.
However, if you don’t plan on staying indefinitely in Japan and want to avoid long paperworks, increasing tax and maintenance costs on an old car, then this service is worth considering. Kinto also doesn’t require a downpayment. You simply pay a fixed rate monthly and can return the car or swap for a new one when the contract ends. Check out the process here.
You can also go the rent-a-car route if you only need a vehicle on a sporadic basis, such as going on a day trip to Shizuoka and the like.
Requirements for buying a car
If you’re set on buying a car, whether brand-new or second-hand, the first and probably the most important prerequisite is having parking space. Whether it’s the parking space at your house or apartment or a slot at a nearby parking space, you need to prove, through a certificate (which is processed at your nearest police station), that you have somewhere to park your car. In short, no parking space, no car.
In our case, we have two parking spaces in our house, and the car agent was very thorough in making sure the dimensions could hold the car. A few days later, someone from the police station arrived to inspect said parking space. They are very serious about this step.
As mentioned earlier, financial stability and good credit standing are some of the factors that will affect the success of a car loan application if you plan on going this route. During our first visit to the dealer, our car agent made a call to their credit company and submitted my identification and background details. A few minutes later, my application was approved.
From there, we had to return another day with my registered hanko (jitsu-in), bank hanko (ginko-in), IDs, and other documents for a tiring session of filling out contracts and forms. Fortunately, our car agent handled everything, which is a perk if you go to the dealer directly and not a third-party car company.
We deposited our down payment, and within a month (it took longer because we accessorized the car and did a full protective coating), we picked up the car. Of course, this timeline can be longer if your car has a waiting list because it isn’t mass-manufactured.
Costs of owning a car
Now, let’s talk about the cost of owning a car on top of the amount you pay for the car. The first is shaken, or car inspection, which is required by law. This is paid every two years, with the amount depending on the type and age of the car (the older, the higher the amount). Next is optional insurance. Since shaken only covers injury and death to a third party, you might want to get extra security by an additional insurance. Again, the price of this insurance increases with the amount of coverage and perks. Lastly, you have the parking fees and recurring expenses such as gas and toll (which are relatively higher compared to other countries).
|Shaken (car inspection)||70,000-150,000||Every two years|
|Car insurance||7,000-15,000||Monthly (decreases after the first year if no incidents)|
|Parking (if applicable)||10,000~||Monthly/contract-based|
|Recurring expenses: gas, toll||20,000~||Depends on usage|
Given the additional costs, getting a car in Japan definitely takes more consideration. If you have decided to get a vehicle, hopefully, the guide above helped cover all aspects and even alternatives!