Five-year extension
Japan's Ministry of Land, Infrastructure, Transport and Tourism says the 2026 tax reform extends the mortgage tax credit for another five years. Qualifying homes occupied between January 1, 2026 and December 31, 2030 can fall within the new period. The scheme reduces eligible taxpayers' income-tax burden based on qualifying mortgage balances and other statutory conditions. The revised framework places increased emphasis on making better use of the existing housing stock rather than supporting only newly built homes.
More support for efficient existing homes
For energy-efficient existing homes, the reform increases eligible borrowing limits, provides additional allowances for qualifying families with children and younger married couples, and extends the deduction period to 13 years. The minimum floor-area requirement is generally relaxed to 40 square metres for both new and existing homes. Some taxpayers, including those with total income above ¥10 million and certain households using additional allowances, remain subject to a 50-square-metre threshold.
Not a general tax break for investment property
The mortgage tax credit is principally designed for homes occupied by the taxpayer as a main residence. Other requirements include moving into the home within six months after delivery or completion and generally having a mortgage term of at least ten years. It should therefore not be confused with a tax incentive for overseas investors purchasing rental properties. Foreign residents buying a home for their own use may potentially qualify, but tax residence, income and property conditions must be assessed separately.