Most common 21-35 year rate is 3.46%
The Japan Housing Finance Agency's September 2026 rate table shows that Flat 35 loans with terms of 21 to 35 years and loan-to-value ratios of 90% or less carry rates ranging from 3.460% to 5.690%, with 3.460% the most common rate. For LTV ratios above 90%, the range is 3.570% to 5.800%, with 3.570% most common. Flat 20 loans of up to 20 years have a most common rate of 3.140% at an LTV of 90% or below. Flat 35 fixes the interest rate for the entire loan term, providing payment certainty but making the rate at the time of disbursement highly important.
Higher rates reduce effective purchasing power
Even if a property's selling price is unchanged, a higher mortgage rate increases both monthly payments and total interest costs. When households set a maximum affordable monthly payment, rising rates reduce the property price that can be supported by the same budget. Japanese buyers therefore need to compare not only negotiated purchase prices but also the rate applicable in the month of loan execution, LTV, fees, mortgage insurance and any available rate-reduction programs. Financing has become a larger part of the purchase decision in 2026.
Foreign applicants face separate eligibility rules
Mortgage eligibility for foreign nationals varies by lender and product. Flat 35 also has applicant requirements, and residence status and permanent-residency conditions may need to be examined depending on the case. The product is different from investment-property financing for overseas non-residents, so its 3.46% rate should not be treated as a benchmark for non-resident investment loans. Nevertheless, fixed mortgage costs are an important indicator of domestic purchasing power and can influence both new and existing housing demand.