Why Tokyo and Osaka Differ on Short-Term Rentals: Policy Goals, Enforcement,...

The difference in homestay policies between Tokyo and Osaka is not simply a matter of 'strict vs. lenient,' but rather a long-standing divergence in the urban positioning of the two cities:

• Tokyo: A Megacity with High Population Density
  Tokyo's core governance pressure stems from high residential density, high demands for community stability, and high sensitivity to neighborhood complaints, leading to regulations that lean more towards controlling nuisance and residential safety risks.

• Osaka: A City with Active Tourism and Commerce
  Osaka has long viewed tourism as one of its urban growth drivers, showing greater acceptance of flexibility in accommodation supply, with policy designs emphasizing the accommodation of tourists and urban vitality.

In simple terms: Tokyo is more concerned about 'homestays affecting residents' lives,' while Osaka focuses more on 'whether homestays promote tourism economy.'

Tokyo's Regulatory Logic: Reducing Nuisance Risks Through Detailed Restrictions

Multiple wards and prefectures in Tokyo employ more refined time and area restrictions, for example:

• Limiting weekday operations in some residential areas, allowing openings only on weekends or holidays.
• Imposing higher requirements on the distance of operation managers, complaint handling capabilities, and guest guidance.

The core of Tokyo's policy is: ==Allowing homestays to exist, but prioritizing the stability of residential communities==.

Osaka's Regulatory Logic: Allowing Development, but Increasing Non-compliance Costs

Osaka generally provides more space for homestays to exist, but regulatory focus is on:

• Implementation of registration and licensing systems
• Penalties for illegal operations and unlicensed businesses
• Accountability for neighborhood complaints and operational responsibilities

The core of Osaka's policy is: ==Allowing homestays to become part of the city's tourism supply, but they must be compliant and subject to regulation==.

Tokyo's Implementation Characteristics

• Emphasis on pre-operation rules
• Management regulations and local ordinances have a significant impact
• In some areas, even with legal registration, operational revenue may be reduced due to time restrictions

Osaka's Implementation Characteristics

• Operational space is relatively clearer after compliance registration
• Enforcement focuses more on illegal operations
• Relatively stable for legal operators

Summary from an investment perspective:
Tokyo's risk lies in 'revenue caps,' while Osaka's risk lies in 'compliance thresholds and enforcement risks.'

Tokyo Homestay Investment Structure

• Homestay cash flow is usually just an added value
• Assets are closer to long-term residence or long-term rental logic
• Homestay operational capability relies more on "special areas" and "scarce permits"

Core of Tokyo investment:
==Property long-term preservation ability > homestay income ability==

Osaka Homestay Investment Structure

• Homestay cash flow has a greater impact on asset value
• Short-term rental income model is more mature
• Homestay operational capability directly affects asset return rate

Core of Osaka investment:
==Operational capability and compliance ability = important components of asset value==

Tokyo Market Characteristics

• Homestay supply is limited, short-term rentals have less impact on the overall rental market
• Long-term rental market is more stable
• Housing prices are mainly driven by employment population and international financial demand

Osaka Market Characteristics

• Homestay supply is highly correlated with tourism cycles
• Short-term rental income fluctuates significantly during tourist seasons
• Changes in homestay policies may quickly affect housing prices in specific areas

Summary:
Tokyo housing prices are more like "driven by urban fundamentals," while Osaka housing prices are more easily affected by "tourism economic cycles + homestay policies."