How to buy a car in Japan as a foreigner: Complete guide

Japan’s known to be a place where everything just works. The trains run on time, public transport is incredibly efficient, and cities are squeaky clean. So the question naturally arises: Do you even need a car here?

Simple answer? Yes. But only if you’re living outside major cities, planning long stays, or want the freedom to explore beyond train lines. And the good news is that buying a car in Japan as a foreigner is possible. The catch? It’s not as simple as walking into a dealership and walking out with a car. There’s a whole lot of paperwork that can feel very… Japanese. You know? Meticulous and organized.

So, we created this guide to prepare you for the whole car buying process. Let’s get right to it.

Identity & legal requirements

What identity documents do you need?

Let’s start with the basics. To buy a car in Japan, you need:

• A valid residence card (Zairyu Card).
• Your Seal Registration certificate (Inkan Shoumeisho). 
• A Certificate of Residence (Juminhyo). 
• Parking Space Certificate (Shako Shoumei) from the local police station.
• A Japanese driver’s license.

Dealerships and registration authorities want proof that you’re actually living in Japan and not just visiting.

Address requirements

As mentioned above, to buy a car in Japan, you must have:

• A registered local address.
• A residence certificate (Juminhyo) from your city office.

And no, a hotel address won’t work. You’ll need either a rental agreement, OR proof of company-provided housing, OR owned property.

You also need to prove you have a legal parking space. This is called a parking certificate (Shako Shoumeisho), and it’s issued by the local police station.

To get a Shako Shoumeisho, you’ll need:

• A parking lease agreement (if renting a spot).
• Or proof that you own the parking space.

Payment and financials

The most common payment options include:

• Cash.
• Bank transfer (preferred by dealerships).
• Auto loans (available but limited for foreigners).

Credit cards are rarely accepted for full payments.

Can foreigners get a car loan?

Yes. To qualify, you need:

• A long-term visa.
• A stable job in Japan.
• A Japanese bank account.
• Some form of credit history in Japan.

Some dealerships offer in-house financing, but the terms may not be ideal.

You can also pay from a foreign bank account, but it’s not practical because international transfers can delay the process, add fees, and complicate the paperwork.

Registration and Insurance

This is where Japan gets very strict. Every car must be registered.

The process includes:

• Ownership transfer paperwork.
• Parking certificate submission.
• Vehicle inspection records.
• Registration at the local transport office.

The good part is that your dealer handles all of this.

So you won’t have to do much except provide all the necessary documents. 

Is insurance mandatory?

Yes. There are two types of insurance:

1. Compulsory insurance (Jibaiseki)

• Required by law.
• Covers basic third-party liability.
• Included in registration.

2. Optional insurance (Nini Hoken)

Highly recommended since it covers your own car, theft, and natural disasters. Most drivers take both.

And in case if you’re wondering, no, foreigners cannot use international insurance. Japan requires locally valid insurance policies.

Also note that short-term insurance is rare for car ownership. Policies are usually annual, renewable, and linked to your residency status.

Key considerations for foreign owners

Here’s what you should know before buying a car in Japan as a foreigner:

1. Parking is not optional, and not cheap. In big cities, monthly parking fees can cost as much as your rent.
2. Every car must pass a vehicle inspection (Shaken). The first inspection is after 3 years. Then every 2 years.
3. You’ll be paying road taxes and maintenance. These include annual road tax, and weight-based tax.
4. Used cars are popular in Japan because they’re well-maintained and the owners often sell them early.
5. You might face a language barrier since not all dealerships speak English. If you don’t already know Japanese, we suggest bringing a Japanese-speaking friend to make things easier.
6. Driving in Japan is on the left side of the road, and vehicles are right-hand drive.

Is buying a car worth it?

Buying a car in Japan makes sense if:

• You live in rural areas or suburbs.
• You travel frequently outside major cities.
• You have family needs like kids’ schools, grocery runs, and going on weekend drives.
• You’re staying long-term (1+ years)

But, you don’t need a car if:

• You live in cities like Tokyo or Osaka.
• You rely on trains, which are excellent anyway.
• You’re staying short-term.

And if you’re in town for a short duration, consider renting a car. It’s the easier option and you can skip the paperwork, and can get on the road quickly. 

Plans that may interest you

eSIM Canada

eSIM Australia

Niyati Shinde

Freelance writer

Read full bio

Related reading