Learn how to leverage Japan's building energy efficiency labeling system, which began in 2024, when searching for a rental. This guide covers how to read energy efficiency ratings, their impact on utility costs, and key points to check during property viewings.
Reviewed by: Nobuyuki MoriPresident, M-Assets Co., Ltd. / Licensed Real Estate Transaction Specialist (Miyagi #018212)
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As of April 2024, the "Building Energy Efficiency Performance Labeling System" began on an effort-obligation basis for newly sold or rented buildings. Led by the Ministry of Land, Infrastructure, Transport and Tourism, this system has third-party evaluators assess and certify the energy efficiency performance of residential buildings and structures, then display this information in an easy-to-understand format in real estate advertisements and at the point of sale or lease.
Following legal amendments from 2025 onward, mandatory compliance has been rolling out in phases. As of 2026, new rental property listings increasingly display "energy efficiency labels." However, many prospective renters remain unaware of how to read these labels and are not taking advantage of the information they provide.
The energy efficiency label typically displays the following information.
Energy Efficiency Standard Achievement Mark (★ Stars)
This indicates whether the building meets the energy efficiency standard (primary energy consumption standards under Japan's Building Energy Efficiency Law). More stars mean higher energy efficiency performance.
Energy Efficiency Rating (ZEH Standard, etc.)
Estimated Annual Utility Costs
The estimated annual utility costs (in units of ¥10,000/year) are listed as a reference for selecting properties. Keep in mind that actual consumption varies depending on usage patterns and household composition, so treat this as a comparative reference only.
Energy efficiency rating differences directly affect not just environmental responsibility, but also your monthly utility bills. Here is a rough estimate of typical costs.
| Energy Efficiency Rating | Annual Utility Costs (Model Case) | Annual Savings (vs. Rating 4) |
|---|---|---|
| Rating 4 (baseline) | Approx. ¥180,000 | Baseline |
| Rating 5 (ZEH standard) | Approx. ¥140,000 | Approx. ¥40,000 |
| Ratings 6 & 7 | Approx. ¥100,000–120,000 | Approx. ¥60,000–80,000 |
*Based on Ministry of Land, Infrastructure, Transport and Tourism model housing calculations (total floor area 120m², 4-person household). Actual rental units (1-room to 2-bedroom apartments) will be proportionally smaller.*
Even so, a difference of one or two rating levels can result in ¥10,000–30,000 in annual utility savings for a studio apartment. When comparing rentals, it is essential to compare the total of "rent + utilities" rather than rent alone.
Energy efficiency standards have become increasingly stringent over the years, resulting in significant performance differences based on the building's construction year.
Older buildings tend to have lower energy efficiency, but there are exceptions: large-scale renovations with insulation upgrades can significantly improve performance. During property viewings, it's helpful to ask about whether insulation work has been done.
Even if an energy efficiency label isn't displayed, you can estimate performance by checking the following during a viewing.
Window Glass and Frames
Ceiling and Wall Insulation
Direct inspection is difficult, but ask the real estate agent for information on insulation specifications or housing performance evaluation reports.
Air Conditioner Efficiency
Request a test run of the air conditioner during the viewing. Check how long it takes to reach the set temperature and observe any cold or warm air leaks near the windows.
Reduced Utility Costs: Savings accumulate over the long term, totaling tens of thousands of yen annually
Comfortable Indoor Environment: High insulation means cooler summers and warmer winters, reducing physical strain on your body
Reduced Condensation and Mold Risk: Proper insulation and ventilation prevent condensation and help suppress mold growth
Environmental Responsibility: Lower CO2 emissions contribute to a more sustainable lifestyle
As the energy efficiency labeling system becomes more widespread, the criteria for selecting rental properties is shifting from "the cheapest rent" to "the lowest total cost." If a property's monthly rent is ¥2,000 higher but utility costs are ¥3,000 lower each month, that's ¥12,000 in annual savings.
When comparing properties, actively check the energy efficiency rating, estimated utility costs, window specifications, and other relevant factors. Adopt a long-term perspective to choose housing that truly offers the best value.
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