Most common 21-35 year rate is 3.46%
According to the Japan Housing Finance Agency, Flat 35 loans with terms of 21 to 35 years are offered at 3.46% to 5.69% in September 2026, with 3.46% the most common rate among participating lenders. The most common rate is 3.14% for 15-20 year loans and 3.70% for 36-50 year terms. Flat 35 fixes the borrowing rate for the entire repayment period, protecting borrowers from future rate increases but creating a higher initial cost than during Japan's earlier ultra-low-rate period.
Higher rates reduce purchasing power
When mortgage rates rise while home prices remain elevated, monthly payments and total lifetime interest both increase. Buyers therefore need to calculate affordability from total housing expenses rather than simply setting a maximum property price. Flat 35 also offers point-based rate reductions for qualifying households and properties, including certain energy-efficient homes. The discounted initial rate should be compared with the later rate that applies after any temporary reduction ends.
Not available for investment properties
The Japan Housing Finance Agency explicitly states that Flat 35 cannot be used to finance investment properties. Overseas investors buying rental apartments therefore need different financing products. Foreign residents purchasing a home for their own use may also face lender-specific eligibility requirements involving residence status, income and other underwriting criteria. Borrowers should compare fixed and floating rates, insurance, early repayment terms and fees rather than focusing solely on the advertised headline rate.