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2026-09-09

The cap on brokerage fees ― the "3% + 60,000 yen" calculation and the special rule for properties of 8,000,000 yen or less

The brokerage fee (仲介手数料) you pay a real estate company on a sale or purchase has a legal ceiling. For a price above 4,000,000 yen, it is "price × 3% + 60,000 yen" plus consumption tax. That is a ceiling, not a fixed price. This article explains the calculation, the amount on a 30,000,000 yen property, the special rule for low-priced properties of 8,000,000 yen or less expanded in July 2024 (up to 300,000 yen), when the fee is paid, what "double-ended" brokerage means, and the reality of negotiating a discount.

About this translation ― This page is an English translation of an article originally written in Japanese by KuraLab's operator, a licensed real-estate transaction specialist (宅地建物取引士) and administrative scrivener (行政書士) in Japan. The Japanese original is the authoritative text; where the two differ, the Japanese version prevails. The article explains Japanese law and procedure in general terms as of the date shown. It is not legal, tax or immigration advice for your situation ― please confirm with a licensed professional in Japan. Japanese terms are kept in parentheses so you can search for them. Read the Japanese original

"Isn't a fee of 300,000 yen too much?" A man in his fifties who was to sell an old rural house he had inherited brought the real estate company's quotation. The asking price was 4,500,000 yen. The house was fifty years old; the price was for the land alone. At 3% of 4,500,000 yen plus 60,000 yen it should be 195,000 yen, but the quotation said 300,000 yen. "Is this a rip-off?" No, I answered. If anything, without that 300,000 yen this house probably would not have sold. This article starts from that reason.

Whether you sell or buy real estate, you pay a brokerage fee to the real estate company. The amount has a ceiling set by law (a notice of the Ministry of Land, Infrastructure, Transport and Tourism under the Real Estate Brokerage Act, 宅地建物取引業法), so the company cannot set it freely. Few people, though, know how it is calculated, and fewer still can explain what "3% + 60,000 yen" means. Let me set it out.

The ceiling is found by dividing the sale price into three bands, applying a rate to each and adding them up. 5% on the portion up to 2,000,000 yen, 4% on the portion above 2,000,000 and up to 4,000,000 yen, and 3% on the portion above 4,000,000 yen. Consumption tax is added. Calculating three bands every time is tedious, so for properties above 4,000,000 yen the shortcut formula "price × 3% + 60,000 yen" is used. The 60,000 yen is the difference between 5% and 3% on the first band (2% × 2,000,000 yen = 40,000 yen) plus the difference between 4% and 3% on the second band (1% × 2,000,000 yen = 20,000 yen). The shortcut therefore gives the same result as the three-band calculation.

For a 30,000,000 yen property, 30,000,000 yen × 3% + 60,000 yen = 960,000 yen, and with 10% consumption tax, 1,056,000 yen. That is the ceiling. The seller and the buyer each pay up to this ceiling to the real estate company they engaged. If one company brokers for both the seller and the buyer, "double-ended" brokerage (両手仲介), that company receives from both sides, over 2,000,000 yen in total.

The ceiling, for sales, excluding tax, as of September 2026: on the portion up to 2,000,000 yen, 5% (2,000,000 yen → 100,000 yen); on the portion above 2,000,000 and up to 4,000,000 yen, 4% (4,000,000 yen → 100,000 + 80,000 = 180,000 yen); on the portion above 4,000,000 yen, 3% (shortcut: price × 3% + 60,000 yen; 30,000,000 yen → 960,000 yen); and for a property of 8,000,000 yen or less under the special rule, up to 300,000 yen from each of the seller and the buyer (5,000,000 yen → up to 300,000 yen where the usual figure would be 210,000 yen).

In July 2024 the special rule for low-priced properties was expanded. Until then, the rule was "up to 180,000 yen from the seller for a property of 4,000,000 yen or less"; it became "up to 300,000 yen (excluding tax) from each of the seller and the buyer for a property of 8,000,000 yen or less." The problem was that for properties traded at a few million yen, such as rural vacant houses or old houses with farmland, the normal calculation gave a fee of only a hundred thousand yen or so, and real estate companies would not move. The situation described in another article on this site, "no company will broker it even if you want to sell," has improved slightly with this rule. Put the other way, if you are told "the fee is 300,000 yen" when selling a 5,000,000 yen property, that is not illegal (it is within the special ceiling). To use the rule, however, the company must explain it to the client and obtain agreement before the brokerage contract is signed.

For a 30,000,000 yen property brokered double-ended, the picture is 960,000 yen from the seller and 960,000 yen from the buyer (excluding tax). If one company brokers both sides, it receives 1,920,000 yen in total (2,112,000 yen including tax); if each side uses a different company, each company receives 960,000 yen.

The timing of payment is not fixed by law; the common practice is half at the sale contract and the other half at closing and handover. Some companies ask for the full amount at contract, but the treatment when a contract is cancelled before closing then tends to cause disputes, so I recommend half and half or a lump sum at closing. The brokerage contract states the timing, so check it before you sign.

Let me also note that it is a "ceiling", not a "list price". The law only sets a maximum; some companies broker for less, and negotiation can bring it down. In practice, though, haggling over the fee on a sale can lower the company's enthusiasm, and I do not recommend it for a property that is hard to sell. For an easy-to-sell property with several companies competing, there is room to negotiate. On the buyer's side, some companies advertise "no brokerage fee" or "half fee"; this works because they take the fee from the seller's side (double-ended), so it is limited to properties that company handles, a constraint you should understand before using it.

Now the consultation. The man's house was twenty minutes by car from the station, and the only buyers would be neighbours or someone wanting a vegetable garden. For the real estate company, going to the site many times before a sale, confirming the boundaries, arranging disposal of the contents left behind, and then receiving 195,000 yen (excluding tax) does not cover the staff cost. In the past, such a property would have been turned away with "we cannot handle it." With the July 2024 rule, a property of 8,000,000 yen or less can earn up to 300,000 yen (excluding tax) from the seller, and this company said, "At 300,000 yen we will take it." I checked with the man whether he had received an explanation of the special rule and agreed. He had been given the explanation before the brokerage contract, and the contract referred to the rule. That made it lawful, and a realistic amount.

The figures side by side. For a 4,500,000 yen property, the normal calculation is 195,000 yen plus consumption tax, 214,500 yen. Under the special rule, 300,000 yen plus consumption tax, 330,000 yen. The difference is 115,500 yen. The man could say "if that difference gets the company moving, it is cheap" because two companies had already turned him down. Fixed asset tax and grass-cutting on an unsellable house drain tens of thousands of yen every year. Leave it two years and the difference in fees is gone.

Double-ended brokerage also came up on the ground. The buyer was a neighbour found by the same company. The company receives a fee from the buyer too. On the buyer's side, with an agreement bringing the special rule into play, up to 300,000 yen (excluding tax, 330,000 yen including tax); without one, the normal calculation gives 195,000 yen (excluding tax, 214,500 yen including tax). Together with the 300,000 yen from the seller, the company earns between 495,000 and 600,000 yen excluding tax (544,500 to 660,000 yen including tax) on the transaction. The man started to say "it is double-ended, so give me a discount," but I stopped him. On a property that is hard to sell, lowering the enthusiasm of the company that is willing to move does not benefit the seller. Fee negotiation is for properties where several companies are saying "let us sell it for you."

Finally, brokerage fees on rentals work differently: the ceiling is one month's rent (excluding tax) for landlord and tenant combined. The official position in the notice is that taking one month's rent from the tenant in principle requires the tenant's consent, but in practice a tenant-paid one month is widespread. Just bear in mind that it is a different calculation from sales.

After closing, the man said, "At first I could not tell whether 300,000 yen was expensive or cheap." That is only natural; people who know the ceiling formula are the minority. The table in this article is there for that reason. When you see a fee quotation, first check whether the property price is 8,000,000 yen or less. If so, up to 300,000 yen is within the special rule; if above, 3% + 60,000 yen is the ceiling. Knowing that much lets you tell "expensive" from "lawful".

Written by: 長澤 湊（licensed real-estate transaction specialist, administrative scrivener, assistant surveyor）　Content checked on: 2026-10-14

This article is a general explanation of Japanese rules and procedures, not advice on an individual case. Figures and rules are as of the date shown. For your own situation, consult a lawyer, judicial scrivener, tax accountant or administrative scrivener in Japan.

Official sources

The rules and figures in this article can be checked against the following official pages (in Japanese).

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