What are the changes to the Real Estate Brokerage Business Act in 2025?

The Real Estate Transaction Business Act, which pertains to the buying and selling of vacant houses, was revised in April 2025. The main points of this revision are the "mandatory pre-inspection" and "strengthening buyer protection" for the buying and selling of vacant houses.

Due to the declining birthrate and aging population, the number of vacant houses is steadily increasing nationwide. While the real estate market is calling for the promotion of the circulation of vacant houses, there are frequent problems due to the risk of dilapidated properties and lack of information. It can be said that we have entered an era in which real estate agents are required to conduct business more responsibly than ever before.

Background of the legal reform and measures against vacant houses

The Ministry of Land, Infrastructure, Transport and Tourism is deeply concerned about the recent increase in vacant houses. It is estimated that there will be over 2023 million vacant houses nationwide by 900, meaning that one in seven homes will be vacant, creating a serious situation.

One of the most problematic cases is when trouble arises with the buyer after the sale.
There are many cases where contracts are made without sufficient property inspections or information being provided, such as "the foundation has sunk," "there is a leak," or "the land cannot be rebuilt," which leads to later complaints and claims for damages.

In light of this background, the following two points are given special importance in this legal reform:

Key point of the amendment: Strengthening the "obligation to conduct a prior survey" of vacant houses

Until now, property inspections required of real estate agents were treated as a "duty of best efforts," but from April 2025, pre-inspections will become "effectively mandatory" when dealing with vacant houses. Examples of inspection items are as follows:

• Condition of the building's foundation, roof, and exterior walls(Tilt, decay, leaks)
• Status of lifeline connections such as water supply, drainage, and electricity
• Compliance with road access requirements and feasibility of rebuilding
• Risk of uncertain land shape, ground conditions, and boundaries

Regarding these items, you may be required not only to visually inspect and interview, but also to attach an expert investigation report if necessary.

Point of amendment ② "Buyer protection" measures when buying and selling vacant houses

- Clarification of notification obligations -

With regard to the "scope of disclosure," which was previously left to the discretion of real estate agents and sellers, such as psychological defects and past uses, this amendment is expected to clarify the following:

-Past incidents and accidents(Suicide, dying alone, etc.)
-Troubles with neighbours(Noise, bad smells, presence of anti-social elements)
-Special usage history(share house, simple lodging, etc.)

These are risks that you would not have purchased if you had known about them, and they can become a source of trouble. In the future, it will be necessary to collect information from sellers and provide appropriate notices.

-Relationship with liability for non-compliance with contract-

Even if the property is sold as is, there is still a possibility that it may be subject to liability for non-conformity with the contract (formerly known as warranty liability).

For example, in cases where "important defects were not explained intentionally" or "the seller did not have an expert investigate," there is a high risk that the buyer will seek damages or terminate the contract. Important explanations and special provisions in contracts also require substantive risk explanations, not formalities.

What impact will this have on important explanations and how are real estate agents expected to respond?

Reporting of investigation results and their impact on important matters explanation documents

There will be an increasing number of cases where investigation results will be required to be included in important matters explanation documents (important matters explanation documents).

・Parts suspected to have structural defects
・Areas where lifelines are underdeveloped
・History of guidance and recommendations from specific administrative agencies, etc.

Up until now, things have been handled by "delivery as is," but there will now be situations where failure to provide accountability regarding the items listed above could result in violation of the business law.

Actions that real estate agents should take

As a real estate agent, you need to take the following steps immediately:

✅Property survey items
✅ Expansion of items to be asked of sellers
✅ Revised template for Important Information Explanation Document

In particular, businesses that handle a lot of vacant house sales and purchases need to create a system of accountability ``immediately.''

My Feelings, Then and Now

The 2025 amendment to the Real Estate Brokerage Act aims to ensure healthy circulation in the vacant house market, but real estate agents will be required to conduct "more thorough investigations and explanations."

The legal reform also represents an opportunity for real estate agents.
The key to becoming a company that customers choose is to be honest and prevent problems before they occur.

(This article was written by Yamamoto)

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