Startup Costs

Costs before opening

Amounts vary greatly by property and area, so this section lists the items. Always get quotes for each property.

• Property: Purchase price, or rent, security deposit, key money, etc. When renting, the landlord may attach conditions to consenting to minpaku
• Safety measures and fire safety equipment: Emergency lighting, automatic fire alarm systems, exit signs, flame-retardant curtains, etc. (whether they are needed depends on the property's conditions) → Facilities and Fire Safety
• Furniture, appliances and supplies: Bedding, towels, cooking utensils, consumables, etc.
• Interior: Repairs or redecoration as needed
• Photos and listing preparation: Photos for booking sites, descriptions and a house manual
• Procedures: Costs of obtaining documents and, if you hire a professional, their fees. A hotel business license requires an application fee (for example, 11,000 yen for a kan'i shukusho in Minato City)
• Building procedures: For a kan'i shukusho, if the floor area subject to a change of use exceeds 200㎡, you must apply for building confirmation

Operating costs

• Booking site fees
• Cleaning and linen costs
• Restocking consumables
• Utilities and internet/phone costs
• Fees for a registered minpaku management company or other contractor (if you outsource)
• Insurance premiums
• Waste disposal costs (many local governments require disposal as business waste)
• Taxes (income tax, resident tax and, in some cases, consumption tax) → Taxes and Filing

The accommodation tax is borne by guests, but the operator collects and pays it. In Tokyo, minpaku will also be subject to it for stays from April 1, 2027.

Think about profitability from the "days you can sell"

Minpaku revenue is roughly "revenue per night × number of days with guests." The number of days with guests cannot exceed the legal 180 days a year or the limits set by ward and city ordinances.

1. Check how many days a year you can operate in the property's area
2. Of those days, make a conservative estimate of how many will actually be booked
3. Subtract per-night costs such as cleaning and fees from the revenue per night
4. Subtract monthly costs such as rent and management fees

In an area where you can operate only 63 days a year and an area where you can operate 180 days a year, the same property will have completely different profitability. It is also useful to compare with a kan'i shukusho (simple lodging), which has no cap on days. → Minpaku vs. Kan'i Shukusho vs. Special Zone Minpaku

Financing

A kan'i shukusho licensed under the Hotel Business Act is eligible for sanitation business loans (生活衛生貸付) from the Japan Finance Corporation (日本政策金融公庫). Minpaku under the Private Lodging Business Act is not eligible.