Three years ago I was paying a management company 5 percent of collected rent across 4 of my 9 properties. On those units that came to about 34,000 yen a month, 408,000 yen a year, for a service I was quietly unhappy with. I renegotiated it down to a partial contract at 3.5 percent by taking back two specific jobs myself. The savings work out to about 122,000 yen a year, and the extra work landed at roughly 3 hours a month. Here is exactly what I kept, what I gave up, and how to have that conversation with a company that would rather keep the full fee.
What a Full Management Contract Actually Bundles
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A standard ippan kanri full contract in Japan usually rolls up six jobs into one percentage:
- Rent collection and transfer to the owner, the shukin daiko piece
- Chasing late payers and coordinating with the guarantor company
- First-response to tenant problems and complaints, day to day
- Arranging and supervising repairs, usually with a markup on the contractor
- Lease renewals and the paperwork around them
- Move-out inspections and deposit settlement
Tenant placement, finding the next renter, is almost always a separate fee of one month’s rent, even under a full contract. So you are paying the monthly percentage for the ongoing operational load, not the leasing.
The Two Jobs I Took Back
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I kept the company on for repairs coordination, renewals and move-out settlement, because those are episodic, need local presence during business hours, and are where a company genuinely saves me time. I took back rent collection and first-response.
Rent collection is barely work now. All my tenants are on bank auto-transfer or a rent guarantee company that pays me directly whether or not the tenant pays on time. I log deposits against a spreadsheet on the 28th of each month. That is about 40 minutes. If a payment is short, the guarantee company covers it and pursues the tenant, so the chasing is not mine either.
First-response I route through a 24-hour dispatch service that costs about 1,100 yen per unit per month. A tenant with a broken lock or no hot water calls that line, a technician is sent, and I get a summary. For non-urgent things, tenants message me directly and I usually reply the same evening. Across 4 properties this is maybe 2 hours in a normal month.
The Fee Math, Itemized
When I pushed the company to break down the 5 percent, they eventually gave me a rough internal split:
- Rent collection and remittance: about 1.0 percent
- Delinquency handling: about 0.5 percent
- First-response and tenant contact: about 1.5 percent
- Repair coordination: about 1.0 percent
- Renewals and move-out settlement: about 1.0 percent
By taking rent collection, delinquency and first-response, I was removing 3.0 percent of value in their own numbers. They would not drop the fee by the full 3 percent, because the remaining jobs still carry fixed overhead, but 5 percent to 3.5 percent was a fair landing spot, and I have seen other landlords get to 3 percent for collection-only.
How the Conversation Went
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Companies do not advertise partial contracts, and the first answer was that they only offer the full package. What changed it:
- I came with specifics: I named the exact clauses I wanted removed and proposed the new percentage myself
- I made clear the alternative was moving all 4 properties to another company, and I had actually gotten two competing quotes
- I offered something in return: a 2-year commitment and prepayment of the annual fee in one transfer, which reduced their admin
- I let them keep the leasing fee at a full month’s rent, which is where they make real money anyway
- I put the new scope in writing as an amended contract, not a verbal understanding, so there is no drift back to doing less
It took two meetings and about a month. The branch manager had to approve it because it was off their standard sheet.
When Partial Is the Wrong Choice
This only works if the jobs you take back are genuinely low-effort for your situation. Partial management is a bad idea if:
- Your tenants pay by cash or manual transfer and you would be doing real collection work
- You do not have a rent guarantee company in place, so delinquency lands on you
- You live far enough away that first-response means a 2-hour drive for a running toilet
- You have several older properties where something breaks most months
- You travel often and cannot be a reliable contact point
On the 5 properties I still fully self-manage, I do all of this anyway. The 4 that had a company were the ones I picked up later, in an area where I had no contractor relationships yet, which is why I keep the company for the repair piece specifically.
What the 3 Hours a Month Really Buys
Beyond the 122,000 yen a year, taking back first-response changed something I did not expect. I now hear about small problems directly from tenants instead of through a monthly report, which means I catch patterns earlier, a repeated drainage complaint, a tenant hinting they might not renew. On one unit that early signal let me start marketing 6 weeks before the tenant gave notice, and I turned it over with 4 days of vacancy instead of a month. That one save covered several years of the fee difference.
Full management is the right call when a property is far away, old, or full of manual processes. But if your rent collection is already automated and your first-response is a phone number plus a same-day reply, you are very likely paying 1.5 to 3 percent for work you have already eliminated. Ask for the itemized split, then ask why you are paying for the lines that no longer apply. That is the approach I now use across all 9 of my properties.
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Developed after switching management companies twice. Saves you from costly mistakes that took me years to learn.
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