Short-term accommodation hosts to be hit with 180 day limit

The Japanese government is currently in the process of introducing a new law to govern the rapidly growing market of short-term letting of individual homes and apartments, and will be imposing strict rules on hosts. The maximum number of days that a property can be let out is expected to be capped at 180 days a year, while maximum fines will be lifted from 30,000 Yen to 1,000,000 Yen for hosts found to be violating the new law.

Accommodation listing sites may be obligated to impose checks on hosts and remove listings once a property has reached the 180 day limit. Local governments will also have the power to reduce the annual limit even further, even to 0 days a year.

The proposal for the new law will be submitted to the National Diet on March 10th for a cabinet decision.

A nationwide investigation carried out by the Ministry of Health, Labour and Welfare in late 2016 found that just 1.8% of the listings in Tokyo’s 23 wards and other major cities were operating with correct licenses or permission.

Currently, letting out a property to guests for stays of less than 30 days requires a hotel license. Recent exceptions were introduced in certain zones in Tokyo’s Ota ward and Osaka Prefecture, but the property must still be approved as a ‘simple lodging’ under the Hotel Business Act. Minimum stays were also introduced, which meant nightly stays are currently not permitted without a hotel license.

According to data from Metro Engines, a company that provides research on the minpaku market, only 14% of the 43,000 listings on accommodation sites had been rented out for more than 180 days in 2016. Last year saw a surge in the number of AirBnb-type listings in Japan with the number of listings doubling over the span of 12 months. The increase in supply has caused average occupancy rates to drop for hosts.

Sources:
The Asahi Shimbun, March 4, 2017.
The Nikkei Shimbun, February 23, 2017.
The Nikkei Shimbun, March 3, 2017.

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