SleepWell Data: Japanese Property Foreclosure Data Resource

Foreclosed Property of the Week: Ikebukero

Posted: Thursday, 16th of August 2012

Ikebukero This week i'm liking Case File No. H24K416, a 33m2 apartment, on the 10th floor of an 8 year old building,  11 minutes from one of the most convenient stations in Tokyo, Ikebukero Station. Its appraisal is a mere 9.26Million JPY. Not that you could buy it for that but read on, it gets better!

Being a little close to the expressway if i were going to live there, this fact doesn’t seem to bother the current tenant who is paying 132,000JPY/mth. The building being only 8 years old, as expected, the photos of the interior indicate the tenant keeping a fairly tidy place. He/ she is also enjoying a good layout, though compact, it contains all modern day essentials including a separate toilet, a place for the washing machine, and good size storage. I also like the south facing (opposite the expressway), squarish balcony not that i expect they use it for anymore than clothes drying despite potential being there for a nice outside table and chairs relaxation area. In general I'm not a fan of 1K apartments or smaller because of their abundance and inflexibility but in this case, the excellent location and larger size, 33m2 (or 35m2 in agent terms), i believe makes up for this.

I am recommending this place from an investment perspective and my intention would be to try retain the current tenant if they were also willing to stay. If you were to want them out a waiting period of 6 months will be required. Either way you may wish to add lost rent to your calculations to be conservative before arriving at a bid figure.

I also like the bldg management fee at a moderate 10,420JPY month. The only negative i would say is that the "kitty" money is less than half the management fee. This however, is by no means abnormal for this size property but as a safety down the line, I would also expect but want to confirm, apart from the usual, that the  building had only one elevator.

From an investment potential this place is great. 1.584Mill JPY/ year in rent, 8 year old building in a very popular location this place is also i believe it would be highly financeable. No doubt others will be thinking the same thing so you'll need to be sharp with your bid. Minimal arrears to speak of, allow 200,000JPY for by the time settlement comes around.
Now for my prediction, and looking at past data, i can see my expectations are correct. This will be a highly contested property and it wouldn’t surprise me to receive well over 25 bids and fetch a selling price of 200% Appraisal. Nonetheless i would still want to be in it for the benefits mentioned above and a 8.5% surface ROI with very low upkeep expenses and high depreciation ability of this property. My bid would be in a very competitive but not over the top, early to mid 18MJPY range.

Last Bids to be in 5pm 4th of September and Bid to Win!!
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Disclaimer: SleepWell has not thoroughly investigated this property and accepts no responsibility of loss due to purchase or attempts to purchase this property. It is absolutely imperative that the prospective buyer undertakes his own investigation or requests the assistance of SleepWell Consulting in procuring this property for them.