Considering a move to the land of the rising sun and trying to weigh up costs before you commit?
Japan has a reputation for being expensive. Yet more and more foreigners are choosing to relocate here each year. With almost 3 million foreigners now living in the country, it is a popular expat destination. It must be doable then, right?
With good health service, a world-famous transport system and, of course, amazing food, the quality of life here is high. If you live like a local and aren’t set on living right in the centre of Tokyo, then it can also be affordable.
Here is everything you need to know about the cost of living in Japan to help you decide if you want to pack your bags and make the move to sushi paradise!
Rent in Japan
One of the first things to consider when considering a move abroad is where you will live.
You may have fallen in love with the buzzing streets of Tokyo when you were travelling, but can you really afford to live in the centre of the capital long term?
As a resident in Japan, rent will make up a big chunk of your living costs. Utilities like electricity and water don’t typically come included when you’re renting an apartment either, so you will need to set aside money for this.
Getting your head around the currency may be a challenge when you first move here. To give you an idea: 1 US dollar = around 100 Japanese yen.
Remember that exchange rates are constantly changing, even from one day to the next. Check the current exchange rate before making any big decisions!
The average cost of utilities in Japan for 1 person is just under 10,000 yen (JPY) per month, so the equivalent of around 95 USD.
This works out as roughly:
- 4000 JPY for electricity.
- 3000 JPY for gas.
- 2000 JPY for water.
How Expensive is Tokyo?
Tokyo is one of the most expensive cities in the world. Its cleanliness, sophisticated public transport system and magical festivals make it a very desirable city to live in. There are approximately 551,000 foreigners living here at the time of writing.
However, estimates show that the cost of living in the capital is 10% higher than elsewhere in the country. Data shows that the average monthly rent for a studio apartment in Tokyo is 89,500 JPY (853 USD).
If you want to reduce your outgoings, consider looking for accommodation options in the suburbs. You can save a significant amount of money if you are prepared to commute to work.
The cheapest areas outside the city centre are Edogawa, Katsushika, and Adachi. Edogawa Ward has the lowest average monthly 1k rent (1 bedroom and a kitchen) at 68,300 JPY (651 USD).
Cost of Living Outside of Tokyo
Happy to live outside of Tokyo? It is worth exploring your options as looking further afield can cut down your living costs significantly.
Don’t mind commuting? You could live in the Kanagawa prefecture and work in an office in Tokyo. Many areas of Kanagawa have a direct connection to Tokyo and you will be on the coast too!
Apart from the capital, which cities are considered the best places to live in Japan?
Here are some of them:
- Kyoto – the beautiful ‘city of 10,000 shrines’.
- Yokohama – an international city with both mountains and ocean.
- Osaka – a bustling business hub with history too.
- Fukuoka – balances city convenience and nature.
Kyoto and Osaka are particularly popular with expats and much cheaper than Tokyo. Many international professionals living here rate them as the best cities for foreigners to live.
How Much Does a House Cost in Japan?
Looking to buy a property here? Hope you’ve been saving hard! Tokyo has some of the world’s most expensive land.
You need to have a serious amount of capital if you’re looking to buy real estate in Tokyo.
Whether you have a visa or not is also taken into account when you are looking to buy property here.
In 2020, the average price paid for a new apartment in the greater Tokyo region is approximately 62,160,000 JPY (about 575,000 USD).
The average cost of real estate in other parts of the country can be up to 80% less! Wakayama, for example, is much cheaper if you’re looking to buy.
Average Income in Japan
Looking for work in this growing economic hub? The average annual household income is approximately 5.17 million JPY (more than 49,000 USD).
Bear in mind, however, that average salaries for foreign workers employed in Japan are significantly lower. This is because of a number of factors, including the tendency for salaries to increase with seniority.
Many foreign workers just stay here for a couple of years and then return to their home country.
Whether you plan on staying for a few years or indefinitely, having at least a basic knowledge of the language will increase your chances of getting hired quickly.
If you don’t have a minimum level of Japanese, then teaching English can be a good route to take. It is one of the most popular jobs for foreign workers, and many salary packages even include flights and accommodation.
How Much Does an English Teacher Earn in Japan?
ESL teachers working here can earn anything between 200,000 and 600,000 JPY (1,700 – 5,000 USD) per month. You can also earn additional cash by teaching private lessons, which are paid at the equivalent of around 30 USD an hour.
If you teach at a university, you can expect to earn significantly more.
Other Jobs for Foreigners in Japan
IT engineers are high in demand. You won’t be held back by the fact you don’t speak the lingo if you speak the universal language of programming!
The average salary for an engineer in Tokyo is 5,671,000 JPY. There are openings for these types of positions across the nation.
There are also opportunities for foreign workers in these sectors in particular:
- Sales and Business Development.
- IT and telecommunications.
- Service staff to work in restaurants.
- Banking and finance.
Ideally, it is best to apply for the job once you are already in the country as this will increase your chances of securing the role.
Many of the jobs on offer for foreigners will be based in Tokyo as this is where many international corporations have their headquarters. If you work outside of the capital, you can expect your earnings to be less; however, your living costs will also be lower.
Taxes in Japan
If you are earning a Japanese salary, you will, of course, be subject to the country’s tax payment system to enjoy the benefits and services of living in the country.
Something to bear in mind is that the percentage of tax you pay may be significantly higher than what you’re used to back home: Taxes can add up to 40% of your income.
However, there are many bonuses of being employed in a Japanese company. These include being able to take advantage of the high/quality healthcare system and living in the country with one of the world’s lowest crime rates.
Cost of Transport in Japan
Japan is famous for having some of the best transport in the world. The high-speed Shinkansen bullet trains wow visitors every time. What is the regular public transport system like though? How do locals get from A to B?
If you have visions of driving to work in Japan, then you will need to know how much you can expect to pay for gas.
Average petrol prices are approximately 130 JPY per litre or 490 JPY per gallon (1.20 and 4.50 USD respectively).
Car Prices in Japan
Planning to buy a car when you move here?
If you go for a Japanese model such as Honda, Nissan or Toyota, then you will find the price to buy a car quite reasonable compared to the price tag elsewhere in the world. There are other costs that car owners must factor in though, such as the obligatory bi-annual inspections (known as shaken).
If you use public transport to get to work, then you can purchase a monthly train pass for unlimited travel. Japanese companies often pay for or partly subsidise their employees’ commuting costs.
Looking for a healthier and more environmentally friendly way to get around? Cycling can be great for your wallet and your physique if you live in the city! You are even allowed to ride on the pavement.
Living Expenses in Japan
Supermarkets in Japan
Worried about the cost of your weekly shop? Japanese supermarkets have a reputation for being expensive. However, it very much depends on what you buy.
Many goods are imported, so indeed the cost of everyday items such as milk might be more than in other countries. Some everyday products might be double or more the price you are used to paying in the US or Europe.
If you stick to local food and buy seasonal ingredients, though, you won’t find the supermarkets to be so expensive. Vegetables, soybean products and even seafood are good value.
Like a bargain? Pre-cooked food is often discounted just before the store closes for the day.
Here is an idea of the food costs in Japan of some everyday items (all costs are approximate):
- How much is a soda in Japan? A can of Coke will cost you approximately 120 JPY.
- The price of milk in Japan – approximately 198 JPY.
- A loaf of bread – 205 JPY.
- 1 kilo of rice – 516 JPY.
- Bottle of water (0.33 litre) – 106 JPY.
- Beer (domestic beer) – 450 JPY.
- Coffee (regular cappuccino) – 395 JPY.
How Much Is A Meal in Japan?
Enjoy eating out? Who doesn’t in this country! Dining out can be very affordable too depending on where you go.
If you are wondering how much it costs to eat out in Japan, well, it varies significantly depending on the type of establishment.
- Famiresu & teishoku
A great budget option for dining with your family or solo. The menu in these family restaurants usually features Japanese dishes like beef donburi as well as more Western alternatives like hamburgers.
These inexpensive dining establishments are usually found in business areas as well as by transport hubs. The price for a meal averages between just 500 to 2,000 JPY (5-20 USD).
Ramen shops are another cheap but delicious option! At lunchtime, many restaurants offer economic set menus (teishoku) for approximately 1000 JPY. Or you can grab a lunch box (bento) to go at a stand or local store.
As another point of reference, a McMeal (or equivalent combo meal) at McDonald’s in Japan will cost you 700 JPY.
Want to splash out on a fancier meal? You’re spoilt for choice in Japan! When it comes to fine dining prices, the sky’s the limit at the luxurious Ryōte restaurants! They feature entertainment from a geisha and normally you can only enjoy this unique dining experience via referral.
Reflections on the Cost of Living in Japan
We hope that you will find all this information useful to help you decide if a move to Japan is financially viable for you. At the end of the day, your living costs will be influenced by your lifestyle. If you want to live in the centre and dine on the finest sushi every day, then you will obviously spend a lot more than someone who cooks at home most days and commutes to work.
Living in Japan is an incredible opportunity to experience a unique culture. The universal health care system, squeaky clean streets, very low crime rate and exquisite buildings keep foreigners coming each year, and there are many opportunities for English speakers to earn good money too. If you decide to make this country your home, you are in for the adventure of a lifetime!