Transcript
Speaker: You're right. That intro is way better, Jerry. I like it better. Okay. We're keeping it. Hey everyone. My name is Taka. You're listening to the buying a house in Japan podcast. Joey and I, we bought a house down in Southern Japan last year, an abandoned house. Since then we've been on this journey and have some exciting updates, hopefully today for you. What's up everybody. What's up Joey. Unfortunately, the last podcast we recorded in person in Santa Cruz.
Speaker: The road caster messed it up. It doesn't sound good. So we're re -recording it, but with updates. Okay. How did it, how did it sound? What was wrong with the quality? Your mic was messed up. It sounded like, I think there was some times where I forgot to speak in the mic for whatever reason. I was like, lean back in the chair, not directed at the mic could have been human error. Okay. Okay. But yeah, anyways, I think this one will be a better and we're becoming better podcasters. I'd say overall rate.
Speaker: Yeah, it's going to be, we'll look back in five years and cringe at our early content. It's okay. I think I, I look back and cringe at everything I did. You think as a kid of like, what the hell?
Speaker: What did we speak about last podcast? Our property, we just put an offer on before jumping into it. I think I made a decision, Joey. I think we make podcasts either 20 minutes or one hour. I feel like we've been jumping between. So I'm going to propose a 20 minute podcast today. Okay. Okay. So since the last time we update you guys, this is going to be another dear diary series. We have put an offer on a property in Tokyo. The air horns out.
Speaker: a little late, but we're excited. Joey, tell us a little bit about the property. You saw it in person two weeks last week. Yeah, I went to go check it out. I checked out two properties while I was in Tokyo. First one had holes in the roof, holes in the walls, like a real barn. So we passed on that one. Uh, second property also in West Tokyo on a different train line, the KO line, this one, the other one was on the Chuo line.
Speaker: Yeah, this property looked really good on the inside. It's immediately livable, is the main thing I would say. And that was my main takeaway there. There are definitely issues that we'll talk about, but very clean on the inside, new tatami upstairs, new floors downstairs, looked like shower was new.
Speaker: The big difference between the first property, the Beppu house and this one is that we could immediately, I would say live in this Tokyo property. Whereas the Beppu one, first thing we did was bed bug killer and that kind of stuff. So yeah, this property doesn't require that type of thing.
Speaker: Yeah, so this property we are buying near our where we went, where we studied abroad. So we studied abroad or I studied abroad for a year. Joey was there for four years at a university called International Christian University. Ironic, not a lot of Christian people go to the university, but it was a, we have fond memories of the spot. And with that, we know the area a little bit better. And I think a lot of people give that real estate advice of invest in your own backyard. And I'd say this is an area where we at least know better than the rest of Tokyo, right?
Speaker: Yeah, although the first, the barn property, the one with the holes in the roof and the walls, we knew that area. It's super, that was like a five minute walk from the university. This one is not quite a five minute walk from the university, but generally the same area. We can take a bus to all the same spots that we used to go to, Kichijoji, et cetera, Kashiura Park.
Speaker: Our bamboo spot is not done yet. So it's still made construction. Of course, construction is going way slower than we hoped. I guess people are probably listening and being like, why, Joey, why are we buying worry? Why are we trying to buy something in Tokyo?
Speaker: Yeah, we were looking to... So a few different reasons, actually. So one of the reasons is office. I think we mentioned this in when we interviewed Rob Arimoto at Shimax Legal. If you're trying to start a business in Tokyo and you eventually want to apply for a business manager visa, your business needs a physical office. So that's one of the reasons we were looking at
Speaker: additional property. And first we started looking in Shizuoka and then we started realizing that, hey, we spent a bunch of time in Tokyo last year, setting things up, seeing friends. We have a ton of business connections in Tokyo. Our Shiho Shoshi is there, our accounting company is there.
Speaker: the J -Rep conference is there. So last year, just in the process of buying the house in Beppu, we spent a significant amount of time in Tokyo doing real mission critical things. So when we started thinking about the business manager visa and, oh, this is going to require an office, we, at first we found a really cool property and she's woke up, but three, six Matsuzaki, rest in peace.
Speaker: Yeah, it was very cool. It was like an abandoned hardware store, but we realized that the real value if we were to get a second property is that being in Tokyo and especially this over the past month when I was in Japan most recently, it's just so the time spent in Tokyo meeting people and meeting the accountants, moving things along there.
Speaker: Was just such a so efficient being there in person. It really makes a lot of sense to have a crash pad in Tokyo. And so we're looking for something cheap and something we can crash. And while we're there, I was stayed in a hotel this time around in first in Kabukicho. That was a really tiny hotel room.
Speaker: and I was sharing it with my friends and it's just not a great experience to be in a hotel room for all that stuff. The biggest reason is that I find is that you don't hang out in the hotel room. You leave in the morning and then you come back in the evening because there's nothing to do in your hotel room and hang out. So when I did get down to Beppu for a little bit to, um,
Speaker: see the house and register a car. It was just nice having space. I had a bunch of work to do when I was down there as well, but having the space in your house and being able to just sit on the couch and relax in the mornings was a great experience. Much more nice to work in that kind of environment. I think at the core of it, we just need a Tokyo home base. And I think Tokyo is more of the big leagues. We've discussed it before on this pod, but Tokyo is one of the few areas in Japan that does not depreciate. So with that, the prices are.
Speaker: I'd say two to three times higher for the same thing in another prefecture. That's a little bit less populated, but totally agree with Joey. I've been to Japan and stayed in Tokyo and Airbnb's friends couches. It's been constantly on the floor once. I was there. I'm gonna call that matches deflated. I wake up and you're literally sleeping on a hardwood floor.
Speaker: Okay. Never again, or hopefully never again. So we have done a friends and family kind of funding round and pulled some money together. So we're going to try to shoot the shot at this spot in Tokyo. We're calling it in, what are we calling it? So the area it's in is in Karasuyama.
Speaker: which is west of Tokyo. I think from door to door, it takes us 40 minutes to get to Shinjuku station or Shibuya station. I forgot which one. So pretty good location, but Joey, tell us a little bit about the area from what you saw.
Speaker: Yeah, the train station's called Chitose Karasu. Literally the characters mean thousand age bird mountain, but the way bird is said is Karasu, which is crow. So thousand year old crow mountain is the literal translation of the train station. Yeah. So we're throwing around some working titles, something around crow mountain, thousand year old crow. We've been calling our property in Eppu.
Speaker: G so G Lux or J Lux just as a short form. So recently when we've been talking about this messaging each other, we've been calling it C Lux, which is like our working short form term for C Lux baby or Crow Lux. Yeah. I actually, maybe Crow Lux is easier to say than C Lux.
Speaker: Yeah, even rewinding further. So Joey and I started this adventure when, so my fiance is from Montenegro. We bought a small investment property there. The building name was called Mazelina Lux. So unfortunately my girlfriend at the time or fiance, she wasn't unable to go do set this Airbnb up. That was the mission. So I was like, Joey needs your help.
Speaker: It all started at Maslina Lux. We're on like the top floor of this empty pool when we're like, let's buy a house in Japan. That's the origin story. Maslina Lux, J. Lux, and now hopefully C. Lux.
Speaker: I think Maslina means Olive in Serbian. Yeah. So Olive Lux, JLux, CrowLux. I also set up an Airbnb in the meantime, somewhere in there in Oahu called Nihau Lux. So give it a look. We're really keeping on the Lux. That was 2020, 2023, right? 2023. Yeah. Okay. We'll come up with the new naming convention soon, but CrowLux.
Speaker: Yeah. I think that's the kind of the updates from the last podcast that we didn't have when we did the last podcast. But the issues are like the big topic me and you have been discussing past few days. Yeah. Let me pull up some of the just basics of it again. It's in this near a train station called.
Speaker: Chitose, Karasiyama, west of Tokyo. It's about a 20 minute walk to the station, I believe. So just hear some details and I'll actually put the listing in our Spotify description. Hopefully by the time we publish this, we either know if we got it or not. But anyways, it's listed at 15 million yen, which roughly translates to $90 ,000 to $100 ,000 US dollar. Let's go yen to dollar exchange rate.
Speaker: This place, most people would consider a piece of shit, I would say, in Tokyo. It's built in 1963, 500 square feet. What is that? Square meters, probably 40 -ish square meters. And it's been renovated once, but it's 60 years old. It has two bedrooms upstairs, one living room slash kitchen downstairs, and a really claustrophobically small shower and bath toilet.
Speaker: But at least that toilet is not a squatty toilet. It is a sitting toilet. Joey saw it. He zoomed me in. Joey first impressions of the inside of the house before we go into the flaws.
Speaker: Yeah, so the inside of the house looked pretty good, better condition than J -Lux down in Bepu, a hundred percent, no question about it. I was scared when I walked into J -Lux that first night. We went back to the hotel that night. I feel like we didn't say much to each other.
Speaker: But Crowlux, very nice on the inside. New floors, new wallpaper, kitchen. Can't remember what was in the kitchen, but oh, like the vent above the stove, new bathroom tiles all looked clean, but didn't look, the bathtub was not a scary one. The J -Lux bathtub staircase was narrow, but everything was dust -free, clean. Upstairs, the tatami mats were newish. They were still that green color and quite a good green color. They weren't starting to turn.
Speaker: uh yellow at all no smells i believe jaylux had a smell this had no smell no grime on the walls everything had been refurnished at some point in the recent past and that's very probably likely the last person living in there was a tenant
Speaker: So the owner passed away, but the owner had a tenant in there up until, I can't remember what it was. It was either like one year or six months ago. And now the new owner either sold it to the real estate company we're trying to buy it from or is trying to sell it himself through this company. But abandoned, I don't remember the specifics talking, maybe remember, but it's either six to 12 months. Yeah, I think it's a little bit, I think our real estate agent got more information. It's actually a little bit longer.
Speaker: maybe two years or something, but it looks very clean, which a little bit of a flag, huh? I think the real estate, the real estate company bought this place or is it still owned by the seller? I wasn't clear. So when we get into the issues, we can talk about why it might be a little bit of a red flag that is so clean in there trying to when I bought my forerunner.
Speaker: Actually, we've been comparing this property a little bit to my old 1994 4Runner, but the guy had a detail. The carpets looked clean. It smelled good on the inside. He had some nice dangly thing from the rear view mirror. And I was, my 4Runner ended up having a ton of problems, still does, but it got suckered in by just how, how clean the 4Runner was. He had got it professionally detailed before he tried to sell it. The same situation might be happening here. What do you think, Take? Jeez. Before we let the 4Runner analogy go, Joey was staying with me in Hawaii for a couple months and
Speaker: I remember you just getting back with a forerunner and your girlfriend at the time was like, it stalled at every light all the way back home. That was bad. I had to kind of my foot on the brake, but also pump the gas to just keep the engine running at like stop sign or red light. Yeah, I got it back though. Yeah. I can talk about the four in a long time. Yeah. I think there's a lot of parallels with the four on here, but when we were on the call, it looked really good.
Speaker: And I remember the real estate agent being like, whoa, this is better than I expected. I was like, okay, this is a, it's priced at under a hundred K in Tokyo. Looks immediately livable. That was like the same. That was a question I asked Joey like 10 times because we're not.
Speaker: I don't want to deal with a G so G Lux abandoned house cleaning situation if I can avoid it. So Joey did say it is livable, right? From what you could perceive a hundred percent. Okay. Fast forwarding other considerations here. It's like a small, really tucked in the entrance way. We weren't sure where we could park bikes, but those were small things. We saw the roof look pretty good. Our intent for this is to use it as like a home base when we live there, maybe Airbnb it, but.
Speaker: Overall, we had decided, let's send it. This looks good. We had let our real estate agent know that let's go ahead and proceed at an offer for actually full price. So 15 million yen. We thought that this was very competitive. It has been on the market for about 12 days to our knowledge. So as the owners of AccuMart, we take a look at this data first, which is a pro tip. If you are a subscriber, take a look at how many views this property had been viewed zero times on AccuMart.
Speaker: We call it a little bit of urgency to like, let's get this offer in there. What happened next, Jerry?
Speaker: We met, everything started, everything was moving very quickly. We were working with ad value real estate agency based in Tokyo, Gotanda. And they moved very quickly, which is very nice. What did happen next? We scheduled, uh, building inspection is the next thing. I was like a full send it like, Joey, let's just get this. And one of the flags actually, when you were there is you guys lifted up the floorboards in Japan. A lot of these first floors are elevated by.
Speaker: couple inches, maybe half a foot. We had a clue. Yeah. And I was like, Joey, let's get it. And I sensed a little hesitancy from you. And what did you say? So, well, we pulled up the flow. Let me talk about the pulling up the floors. So we pulled up the floors, me and a real estate agent and in Japanese homes of this age, there's no concrete slab underneath on the final bottom floor.
Speaker: that the frame rests on. It's built up on these short little pillars that have a small concrete footing, but it's really just a dirt floor underneath the floor that you walk on. So Japanese home in that you step inside the entranceway, the genkan, and then you step up about maybe just under a foot, just under 12 inches up to where the actual floor level is. So the floor level is raised above the surrounding ground outside.
Speaker: And there's usually a little hatch that you can open usually in the kitchen. This house has two, one in the downstairs living room area and one in the kitchen. Those rooms are right next to each other. And both rooms have a little hatch that you can look at that crawl space underneath the floor. So you get about, in Jisogi, we have a little bit more room. It's about two to three feet at Jisogi. In this house, it was about a foot and a half, the crawl space.
Speaker: And so we decided to take a look at the crawl space. I wasn't sure what I was looking for, maybe cracks in cement or in the footings. I guess I was looking for when I first opened it up, so I wasn't quite sure what I was looking for. But as soon as I stuck my head down there, the first thing I realized was it was very moist. Like the humidity was high in that crawl space.
Speaker: Yeah, looked around, didn't see too much in terms of cracked footings or anything like that. But again, humidity was high and I started taking a look at the wooden pillars that the house rests on. So let me just grab it quickly one more time. The floor and the whole frame of the house is supported by these pillars. I don't know how many there are.
Speaker: in underneath the floor in one room. Let's say there's six to eight of them of these little pillars. It's a vertical like four by four piece of wood that rests on sometimes it's really just like a cinder blocky looking concrete footing that's half buried in the ground. And I could see that the bottom four inches of those pillars were soaked in water. So the water had been weeping up the wood.
Speaker: to about four inches in height and yeah, I don't know, we've got pictures, maybe we make that the thumbnail, I'm not sure. But yeah, which makes me think, okay, high moisture in that room, it's weeping up, which is interesting, which means like the dirt is wet. It doesn't make me think that the moisture, there's just a high concentration of moisture where if it wasn't just a high concentration of moisture in the air, I would expect that the wood would be consistently wet everywhere, but really it was weeping up from the ground.
Speaker: into these pillars. So that's where we left it. And I went home and I told you, Taki, I was like, immediately livable kind of thing. Only one concern is the moisture. So my main thought was rot. I, my parents had this cabin in Nova Scotia and one of the walls there.
Speaker: Again, problems with moisture and just rotting a lot of the structure, structural aspects of this one portion of the wall has almost completely rotted away and it needs to be replaced very soon. So that's what I was thinking. These wet wood structural supports rot is this, this could be a real liability. Totally. With that feedback, we decided to hire a home inspection. The home inspection was organized by our real estate agent. This costs us around $800, I think with exchange rates.
Speaker: He actually organized it really fast. Shout out to Yoshisan at added value. He did it during golden week, which is a huge test. This entire Japan is shut down during this weekend. This guy somehow did it. So we got our home inspection yesterday and it was damning to say the least. Perfect timing. We got the home inspection back. So the three big things that were wrong.
Speaker: First, the house was not level. This isn't a huge issue. It sounds like somewhere between 1960 and now they extended the house. So it's a little bit droopy, but he said the home inspector said we could fix this. This isn't insurmountable. The second one is we cannot meme -puck it or Airbnb it. So in the city of Setagaya, you can only Airbnb on
Speaker: Saturday, Sunday to Monday. So two nights or basically weekends, which is less than ideal, but also not a deal breaker. This is supposed to be for our personal, like our personal home base. But the worst part as Joey saw, this could be 11. We got the home inspector to take a look at the pillars. He did like this moisture test and he was like, some pillars were 20 % moisture, which is normal. And then.
Speaker: Some were 90%. So Joe, you nailed it with the moisture. He also found that there are termites, there's rot, there is mold and we're like, okay. Yeah. All symptoms of moi. I did a little bit of reading online and ter - termites, mold, rot, all symptoms of moisture and even worse bed bugs or like the tatami bed bugs that Danny also attracted to wet wood.
Speaker: So a whole host of problems can come from the moisture. We were looking at like, where is this moisture coming from? And there's actually, he found that there is a well under our house. So we don't know if that well is leaking, but we suspect that this is where it's coming from. Other people on Facebook, we follow a group called building a house in Japan or building in Japan. It's really helpful. They suggested that maybe our gutters weren't draining correctly, which
Speaker: Actually, Joey, I'm literally looking at a photo of the house right now and our gutter goes directly into the ground. I don't see it. Really? Yeah. Actually, so our real estate agent, sorry if I call him Yoshi, but that's a real estate agent. Right, Joey. Yoshi's son. Yeah. So Yoshi's son, in one of his messages, he said that the billing inspector took a look at the gutters and they said they were fine.
Speaker: Okay. So I don't know, but he did. That was part of his message to us after the building inspection. You're seeing them go directly into the ground. I'll take a closer look later. It looks like a good, maybe it's like bear. I could see how the water would somehow get to where it is, but we looked at the water tables. We, everything is a little bit of a mystery. So a lot of diddle back and forth with me and Jerry yesterday, we talked for maybe two or three hours. We're like, what are we doing? Are we offering full price, 15 million yen for this?
Speaker: potential lemon. I brought the analogy of Joey's forerunners. Like Joey, would you buy your forerunner again, knowing it was a lemon? Were you walking into a lemon situation here? No, you wouldn't know. I learned a lot. There was a good experience, but reflecting back on the time that I had with the forerunner, I needed something a slightly more reliable. I did have to lean. I did have to lean on friends cars more than I hoped to during that time. I hope that isn't isn't our harbinger of what's to come with the house.
Speaker: Okay. I'm on the flip side where Joey and I, we were planning on any way to get rid of the floor and do a concrete floor. Like I love polished concrete floors and think they look rad. And I think making the ceilings higher. So that was one of the feature improvements we were going to do either way. And I say, Joey, we're in the game of buying abandoned homes. We're not buying perfect houses. This is part of the adventure. Although I'll be, it might be costly, but I don't think this is insurmountable was my attitude.
Speaker: And I think I convinced you a little bit, Joey, about your feeling about it now.
Speaker: Yeah, it's true. We did want to drop the floor. We've seen it done before where you, instead of stepping up from the Gen Con, you just make that straight floor and then you gain the extra foot of space between the floor and the ceiling makes the ceiling seem higher. We did want to do that. We like the concrete look. It does, it does force us to make that happen and tackle the floor. I guess like I'm still thinking in my head, so one of the, I can't remember if we mentioned this, but the well is not.
Speaker: The well is under the living room. The pillars with the highest moisture content were in the kitchen. So that's a little bit of a head scratcher as well. It's waking up from the ground. So it's the ground that's moist. There's got to be a leak somewhere. I really have no idea how hard it is to track down plumbing leaks with city pipes. Maybe it's a city leak. Maybe it's house plumbing.
Speaker: Yeah, and the thing with the real estate transaction, it seems like the seller needs an answer quickly. So we ultimately settled on a low ball offer. Sorry, I know we're tired kicking here, but it's just going to cost a lot of money to fix this. So we dropped our price down to 10 million yen. We are still awaiting a response right now. 10 million yen is $65 ,000. So I hope the next time we record, we can say we bought a house in Tokyo for $65 ,000.
Speaker: Not too optimistic. I would say we got a 50 50 chance, Joey. What's your gut tell you? So it's interesting. So what we learned, our real estate agent, Yoshi son, when we got the building inspection done, he told us that the seller's agent doesn't want to hear the results of the building inspection. Close the ears, close the ears because.
Speaker: They now have, it must be legal because they were serious about it, but they have a legal responsibility to tell any prospective buyers about the issues that were uncovered in the billing inspection. Say we pull out of the deal, but we share the billing inspection report with them. They have a legal responsibility to tell any other prospective buyers that. So they said, don't tell us the results of the billing inspection. So messed up, huh?
Speaker: Yeah, a little, a little shady. They know this is a problem, I think, right? They either know there was a problem or they knew there could be a problem. So potentially that's why the house looks so good on the inside because they really cleaned it up to try to sell it. But it does seem like they're waiting for a sucker to buy it. Just the fact that they're like, don't tell they're putting their fingers in their ears a little bit. Yeah. When we talked to Yoshi's son about the 10 million offer, as opposed to 15 million yen.
Speaker: He was like, it could be a little bit difficult to negotiate with the seller and the real estate agency because they don't know the issues that we've uncovered. We just, all we can say is that they're bad. They know. So we have a 10 million yen offer out on this house. We'll keep you guys posted. We're hitting that 20 minute point. Joey, we got to run soon. But other than that, I'm bullish. If we don't find this property, I think the gun is loaded. We're ready to go. Tokyo, here we come.
Speaker: all right
