Japanese properties are built using four main structural types, and the government assigns each one a statutory useful-life value for depreciation purposes (“the legally defined service life,” 法定耐用年数). This figure is easily misread as meaning a building must be demolished and rebuilt once it passes a certain age. In practice, that is not the case — Japan’s statutory service life is purely a tax concept and has no necessary connection to how long a building can actually be used. This article breaks down the structural types used in Japanese buildings and how they affect value.
Structural Types Used in Japan
Wood Construction (W)
Wood construction uses timber as the main building material. It is common in detached houses, has a lower construction cost, resists dampness well, and allows good air circulation. Its drawbacks are weaker soundproofing and fire resistance. Statutory service life for wood-frame or synthetic-resin residential buildings is 22 years — the two materials share one NTA category; 20 years applies to restaurant-use buildings in the same category, not to residential use.
Steel Frame Construction (S)
Steel frame construction uses steel as the main beam and column framework, with walls and floors built from other materials such as wood panelling — hence “steel frame,” using steel for the skeleton. It is further divided into light-gauge and heavy-gauge steel: light-gauge steel refers to frames with a thickness of less than 6mm, and heavy-gauge steel refers to frames with a thickness of 6mm or more. Compared with wood construction, it is sturdier and offers better fire resistance, though its drawback is that exposed steel, despite protective coatings, remains vulnerable to environmental corrosion.
Statutory service life for steel-frame residential buildings:
| Steel Thickness | Statutory Service Life |
|---|---|
| 3mm or less | 19 years |
| Between 3mm and 4mm | 27 years |
| 4mm or more | 34 years |
Reinforced Concrete Construction (RC)
Reinforced concrete construction embeds steel reinforcing bars (rebar of 1cm thickness or more) within concrete. The combination brings together the advantages of both materials, improving the building’s earthquake resistance, fire resistance and soundproofing. Steel rebar has strong tensile strength, and concrete performs well under compression; encasing the rebar in concrete also protects it from oxidation while giving the structure good tensile capacity, helping it withstand earthquakes and typhoons. The trade-off is a higher cost, and lower density can make it more prone to mould growth. The statutory service life for reinforced concrete residential buildings is 47 years.
Steel-Reinforced Concrete Construction (SRC)
Steel-reinforced concrete construction combines steel framing with rebar, with concrete poured into the gaps between them. It is common in high-rise structures such as towers. In Japan, SRC is generally considered to offer better earthquake and fire resistance than RC, and because its beams and columns take up less cross-sectional area, it leaves more usable interior space. The statutory service life for steel-reinforced concrete residential buildings is also 47 years.
Source: National Tax Agency, Statutory Service Life
https://www.tax.metro.tokyo.lg.jp/shisan/info/hyo01_02.pdf
How Statutory Service Life Affects Value
As noted earlier, Japan’s statutory service life is purely a tax concept used to calculate a building’s depreciation rate, which in turn affects the government’s valuation of the property and, through that, the “fixed asset tax assessed value” — so it indirectly affects taxes such as the fixed asset tax and city planning tax as well. In practice, however, this does not mean a building becomes unusable once it passes its statutory service life. That said, a building beyond its statutory service life may find it harder to secure a bank mortgage, and this can make it harder to sell to a buyer relying on a mortgage in future. At the same time, a building’s structural type has no necessary relationship to its earthquake resistance standard — what matters is whether it meets the earthquake resistance standard currently in force. We recommend using compliance with the current earthquake resistance standard, rather than structural type alone, as the deciding factor before investing in Japanese property.
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