When renting a property, you are always required to sign a lease agreement.　Even though many people have heard of this term, you may still wonder:　
“What exactly does it include?”
“What types of lease agreements are there?”
A lease agreement is an important contract between the tenant (lessee) and the landlord or real estate company (lessor) that sets out the terms and conditions of the rental arrangement. Failing to fully understand its contents may lead to unexpected problems later on.

In this article, we will clearly explain the basics of lease agreements, the different types, the signing process, and required documents — even for first-time renters.
If you are planning to rent a property or want to review your current lease terms, read on until the end.

What Is a Lease Agreement?

A lease agreement is a contract in which the lessor (landlord) allows the lessee (tenant) to use the property in exchange for payment (usually monthly rent). Lease agreements are commonly used for housing, stores, parking spaces, and other real estate. Legally speaking, however, this type of agreement can also apply to the rental of other assets or items.

Legal Definition and Status of Lease Agreements

Lease agreements are defined under Article 601 of Japan’s Civil Code.
The article states "The lessor agrees to allow the lessee to use and benefit from the property, and the lessee agrees to pay rent as compensation." In short, it’s a simple but important agreement: “I let you use my property, and in return, you pay me.”

In addition, when real estate such as land or buildings is involved, Japan's Act on Land and Building Leases (Shakuchi-Shakuyaho) also applies to protect the tenant’s rights.

Difference Between Lease Agreements and Gratuitous Use Agreements

Lease agreements are often confused with gratuitous use agreements. A gratuitous use agreement allows someone to use a property without paying rent.
For example: A parent allowing their child to live in a vacant house rent-free.

Lease Agreement (賃貸借契約)：Rental contract involving payment of rent
Gratuitous Use Agreement (使用貸借契約)：Loan for use without rent (no payment required)

Since the contents and legal implications of each contract are different, it’s important to choose the correct contract type depending on your situation.

Difference Between Building Lease Agreements and Land Lease Agreements

There are two main types of lease agreements: building lease agreements and land lease agreements. Since the applicable laws and contract terms differ for each, it’s important to clearly distinguish between them.

• Building Lease Agreement: This applies when renting a building, such as an apartment or condominium. Japan’s Act on Land and Building Leases (Shakuchi-Shakuyaho) applies, providing relatively strong protection for the tenant’s rights.
• Land Lease Agreement: This applies when leasing land. If the lease involves constructing a building on the land, it is treated as a land lease right (shakuchi-ken), and the contract period and renewal conditions may differ.

As you can see, the applicable contract depends on the type of property involved, so it’s important to pay close attention to which type of lease you’re entering into.

Main Types of Lease Agreements

There are several types of lease agreements, and depending on the contract type, the contract period, renewal conditions, and termination rules may vary.
Below is a simple explanation of the most common types.

Ordinary Lease Agreement (Standard Lease)

The most common form of lease is the Ordinary Lease Agreement. Most rental housing contracts in Japan fall under this category.
The typical contract term is two years, and the contract is generally expected to be renewed upon expiration.

• The contract can usually be automatically renewed after the initial term.
• The landlord cannot easily terminate the contract without justifiable reason.
• Tenant rights are strongly protected.

Because of this, the ordinary lease agreement is well-suited for those planning to live in the property long-term.

Fixed-Term Lease Agreement

A Fixed-Term Lease Agreement specifies in advance how long the lease will last, and the contract automatically terminates at the end of the period.
Unlike ordinary leases, there is no automatic renewal — a new contract must be signed if both parties agree to continue.

• The lease automatically ends upon expiration.
• Renewal requires mutual consent.
• The landlord must provide written explanation at the time of contract signing stating that it is a fixed-term lease.

This type of contract is often used in cases such as temporary relocation for work or when the landlord plans to use the property again in the future.

Sublease Agreement (Master Lease)

In a Sublease Agreement, a property management company or real estate agency rents the property in bulk from the owner, and then subleases it to tenants.
In this case, tenants sign the lease not with the property owner but with the sublease company.

• The tenant’s contract is with the property management company, not the owner.
• Rent amounts and renewal terms may differ from ordinary rental contracts.
• In case of any issues, the sublease company serves as the point of contact.

While convenient in some respects, sublease contracts can lead to disputes if the contract terms are not carefully reviewed, so caution is necessary.

Lease Agreement Process: Step-by-Step Guide to Signing a Rental Contract

What steps are involved when actually renting a property?
Below is a step-by-step explanation of the general process leading up to the signing of a lease agreement.

Step 1: Clarify Your Requirements & Search for Properties

First, clearly define your requirements — such as location, rent, floor plan, and amenities — before beginning your property search.
Gather information by consulting real estate agents and browsing rental listing websites.

Step 2: Property Viewing (On-Site Inspection)

Once you find a property that interests you, schedule an on-site viewing.
Check carefully for aspects that may not be visible in photos, such as natural lighting, neighborhood environment, and the condition of the facilities.

Step 3: Application & Tenant Screening

If you wish to rent the property, submit a rental application form to express your intent.
The landlord or real estate company will then conduct a tenant screening, reviewing factors such as your income, employment status, and whether you have a guarantor.

Step 4: Review of Lease Terms & Explanation of Important Matters

After passing the screening, a licensed real estate agent ( Real Estate Transaction Specialist) will conduct an Explanation of Important Matters.
The agent will explain the contract details, property information, and important points, so be sure to ask any questions at this stage.

Step 5: Signing the Lease Agreement & Submitting Required Documents

Once you fully agree to the terms, you will sign and seal the lease agreement.
At this time, you must also submit the necessary documents, such as proof of identity, income verification, and documents related to your guarantor.

Step 6: Payment of Initial Costs & Key Handover

After signing the contract, you will pay the initial costs, which typically include security deposit, non-refundable move-in fee (reikin), first month's rent, and agency fee. Once payment is confirmed, you will receive the keys and can officially move in.

Required Documents for Lease Agreement

When signing a lease agreement, it's not just about reviewing the contract terms — you’ll also need to submit specific documents.
Missing documents can delay the process, so be sure to prepare everything in advance.

Personal Identification Documents

These are required to verify the identity of the applicant. Common examples include:

• Driver’s License
• Health Insurance Card
• My Number Card
• Passport
• Residence Card (for foreign nationals)

※Some real estate companies may request multiple forms of identification.

Proof of Income

To verify your ability to pay rent, you must provide documentation of your income:

• Recent payslips (1–3 months)
• Withholding tax statement
• Copy of tax return (for self-employed individuals)
• Certificate of tax payment

Demonstrating a stable income can improve your chances of passing the tenant screening.

Personal Seal (Hanko)

A seal (either a standard or registered seal) may be required for signing the lease.
Recently, some contracts can be completed with a signature only, but some landlords still require a registered seal. Check in advance.

Guarantor Documents (If Required)

If a joint guarantor is needed, the following documents may be requested:

• Written consent of the guarantor
• ID documents of the guarantor
• Proof of income of the guarantor

Even if a guarantor company is used, a personal guarantor may still be required in some cases.

Other Documents (As Needed)

Depending on the property and contract terms, you may need to submit additional documents:

• Student ID (if you're a student)
• Certificate of Employment
• Proof of insurance (such as fire insurance)

Check with your real estate agent in advance to ensure you’ve prepared everything.

Key Points to Check in the Lease Agreement

To avoid future disputes, it’s important to carefully check the lease agreement.　Make sure to review the following points and sign only after fully understanding the terms.

Contract Term & Renewal Conditions

Whether the contract is a Standard Lease or a Fixed-Term Lease affects the end conditions and renewal eligibility.
Be sure to confirm whether there's a renewal fee and when and how renewal procedures take place.

Breakdown of Monthly and Miscellaneous Costs

Review the total amount you’ll be paying each month and understand what’s included:

• Monthly Rent
• Common Area/Management Fees
• Parking Fees
• Renewal Fees or Contract Update Charges
• Bank Transfer/Payment Processing Fees

Check the fine print to avoid unexpected costs.

Conditions for Restoration and Move-Out Fees

Disputes often arise over how much restoration is needed upon move-out.
Be sure to check:

• Special clauses related to restoration
• Method of security deposit settlement
• Whether you’ll be charged for cleaning or repairs (e.g., wallpaper, flooring)

You can also refer to the Ministry of Land, Infrastructure, Transport and Tourism's "Restoration Guideline".

Prohibited Activities and House Rules

• Pet restrictions
• Rules regarding musical instruments
• Prohibition of subleasing or using the property for short-term rentals (Airbnb, etc.)
• Garbage disposal rules

These rules affect daily living, so make sure you understand them clearly.

Terms for Mid-Term Termination

In the event you need to move out before the end of the lease term, make sure to check the applicable rules in advance.

• Required notice period for termination (usually 1–2 months in advance)
• Whether any penalty fees apply
• Penalties for early termination (e.g., moving out within 6 months)

To avoid future disputes, it’s important to confirm that these conditions are clearly stated in writing.

Important Points to Note After Signing the Lease　

Even after signing the lease, there are some important things to keep in mind to ensure a smooth living experience. To prevent problems later on, be sure to follow these guidelines.

Inspect and Document the Property Upon Move-In

When you move in, carefully inspect the condition of the property and document any existing damage with photos and notes.
This helps avoid disputes over restoration costs when moving out.

• Check for any damage or stains on walls, floors, or ceilings
• Test built-in appliances (e.g., air conditioning, lighting, stove)
• Inspect plumbing and wet areas for mold or leaks

If any issues are found, report them promptly to the property manager or landlord.

Manage Rent Payments

Late rent payments can damage your credibility. Be aware of your payment due date and method (e.g., automatic bank withdrawal), and make sure not to miss a payment.
It’s also helpful to confirm whether reprocessing is possible if a payment fails, and whether late fees will be applied.

Follow Rules and Etiquette

Be sure to follow the rules outlined in the lease agreement or provided by the landlord.

• Proper sorting and disposal of garbage
• Avoiding noise and neighbor disputes
• Proper use of shared spaces like hallways and entrances

Being considerate of others helps maintain a pleasant living environment.

Know Who to Contact in Case of Trouble

Make sure you have quick access to the contact information of your landlord or property manager in case of issues such as equipment malfunctions or neighbor problems.
Having a clear emergency contact system in place ensures prompt responses.　

Summary｜ Understand the Basics of Lease Agreements for a Safe and Smooth Experience

A lease agreement involves multiple steps, from finding a property to signing the contract and managing life after move-in.
By fully understanding the lease terms, required documents, and key points, you can avoid unexpected problems and enjoy peace of mind in your new home.

Pay particular attention to the type of lease (ordinary or fixed-term) and carefully review the contract details.　
Even after moving in, following the rules and being prepared for any issues will help you handle challenges calmly.　

Having the right knowledge and preparation is the first step toward a comfortable and trouble-free rental experience.