"Zero Entry Fee for Elderly Housing in Japan"...Middle-Class Seniors Face Overflowing Options [Senior House]

[11] Japan Has Many Homes for Middle-Class Elderly

Move-in Fee Reduced from 26 Million Won to '0 Won'
Lower Prices and 'Customer Attraction Strategies' Like Trial Stays

Over 3,000 Elderly Homes in Tokyo Alone
Monthly Rent Including Food Costs 1.9 Million Won... Tailored to Middle-Class Pension Levels

Exterior view of Teresa Care Home, a senior housing facility located in Kawasaki City, Kanagawa Prefecture, Japan. Photo by Yujin Park

Kawasaki City, located just 30 minutes by subway from Tokyo, Japan, is home to as many as 508 senior housing facilities clustered together. Kawasaki is a satellite city similar in size to Seongnam City in Gyeonggi Province. ‘Teresa Care Home’ here was opened in 2008 by remodeling an old dormitory formerly used by construction company employees. It has the advantage of being just a 4-minute walk from Shin-Maruko Station, making it easy to reach by subway from central Tokyo. However, this alone was not enough to survive in the fiercely competitive senior housing market in Kawasaki.

"In the past, we charged new residents an entrance fee of 3 million yen (about 26 million KRW). But it seems the elderly found that entrance fee burdensome. The number of vacant rooms gradually increased. At one point, the vacancy rate rose to 40%. Land prices here are cheaper than in central Tokyo. As a result, many similar types of senior housing appeared nearby, and prices gradually dropped. People thought there was no need to pay a high entrance fee to move in." (Subaru Fukumoto, CEO of Teresa Care Home)

Exterior view of Teresa Care Home, a senior housing facility located in Kawasaki City, Kanagawa Prefecture, Japan. Photo by Yujin Park

Six years ago, CEO Subaru (40) who took over this place eliminated the entrance fee. The pamphlet for Teresa Care Home emphasizes ‘0 yen’ in large red letters under the entrance fee section. To attract elderly residents, they introduced a trial stay system. Since there are so many competitors, they encourage people to compare with other homes and choose. The trial stay can last up to two weeks. Residents only need to pay about 8,000 yen (about 70,000 KRW) per night, including meals.

3,400 in Tokyo alone... Many places for the middle class

Senior housing in Japan is currently ‘saturated.’ Not only in outskirts like Kawasaki City but also throughout Tokyo, senior housing is as common as schools or hotels. According to ‘Kaigo Home,’ a website providing information on senior housing in Japan, there are 3,377 senior housing facilities in Tokyo as of the 24th. They are spread throughout every corner of Tokyo’s alleys. The capacity varies widely from a few dozen households to several hundred.

Japan, which entered a super-aged society about 20 years ahead of South Korea, has long established housing infrastructure for ‘middle-class late elderly.’ The representative types are ‘service-provided senior housing’ and ‘paid nursing homes.’

Service-provided senior housing increased explosively after the revision of the Elderly Housing Support Act in 2011. It popularized housing by setting criteria for residents, deposits, and area to make it easy for middle-class elderly to move in. Paid nursing homes are also classified as places where middle-class elderly reside.

Both types selectively provide only the necessary help to the elderly while lowering monthly rent according to their pension income. This allows middle-class late elderly to live without worrying about costs. Among senior housing in Tokyo, 46% (1,552 facilities) fall into these two categories. Nationwide in Japan, there are 25,238 such facilities.

Grandmother Mio Fukumoto (90), living in the elderly care home 'Teresa Care Home' located in Kawasaki City, Kanagawa Prefecture, Japan, is resting in her room. Photo by Yujin Park

In Japan, monthly rent can be paid with pension

Care services are optional, not mandatory. Elderly who want additional care services can apply separately to local governments. Grandma Mio Fukumoto (90), whom we met at Teresa Care Home, said, "It became difficult to bathe alone and I wanted to do rehabilitation exercises, so I applied for services at the city office. Then a care worker came here to help me," adding, "The government covers the cost." In Japan, when elderly residents in senior housing receive external services, costs are covered by insurance according to the ‘kaigo grade,’ which corresponds to Korea’s long-term care grade.

The monthly rent at Teresa Care Home is 183,100 yen (about 1.6 million KRW) per person for a single room, which is not much different from the average pension amount received by Japanese elderly. According to the Ministry of Health, Labour and Welfare data, as of 2022, the average monthly pension amount combining welfare pension (retirement pension) and national pension for Japanese elderly in their 70s is about 150,000 yen (about 1.3 million KRW).

Eating two meals daily at the dining hall costs an additional 33,000 yen (about 300,000 KRW). Compared to South Korea’s top-tier senior welfare housing, where deposits are in the billions of KRW and monthly rent ranges from 3 to 5 million KRW, this is much cheaper. Grandpa Yukio Tanaka (80), who lives here, said, "I can pay rent with the pension I receive every month, so I have no worries," and added, "Above all, since coming here and eating the diet planned by a nutritionist, my diabetes levels have improved."

A dining area at Teresa Care Home, a senior housing facility in Kawasaki City, Kanagawa Prefecture, Japan. On one side of the dining room, robots managing the residents' medications are lined up. Photo by Park Yujin

[11] Japan has many homes for middle-class elderly