The recent sauna boom has gone beyond mere health consciousness to create new value in the real estate market.
Sauna-equipped real estate is attracting attention as an innovative property that significantly changes the conventional concept of residential facilities and has the potential to both improve the quality of life for residents and increase profitability for investors.
In this article, we will provide a detailed explanation of real estate with sauna from a professional perspective, from basic knowledge to investment value, based on our many years of experience in the real estate industry as INA & Associates, Inc.
We will strive to provide useful information for those who are considering real estate with sauna, those who are interested in real estate with sauna as an investment target, and those who are searching for a new form of home.
Real estate with sauna refers to real estate that is equipped with sauna facilities in residences and investment properties.
These properties provide an environment where residents can enjoy a sauna experience in their own homes by installing a dedicated sauna room or sauna box in addition to conventional bathroom facilities.
The characteristics of sauna-equipped real estate include relaxation in a private space, contribution to health promotion, and the creation of added value by differentiating the property.
Demand for properties with saunas in the real estate market is showing a marked increase from 2023 onward.
The number of inquiries on portal sites specializing in saunas has increased 2.5-fold over the past two years, a figure that truly demonstrates the high level of interest in the market.
Behind the increase in demand are an increase in home time due to the Corona disaster, heightened health awareness, and changing consumer needs for healing in a private space.
In particular, the potential need for properties with saunas is expected to continue to grow due to the expansion of a segment of sauna enthusiasts (sauners).
Sauna properties can be categorized according to their form as follows
For single-family homes, sauna rooms may be incorporated into the design from the time of new construction, or saunas may be added to existing homes through renovations.
In condominiums, there are two types of sauna facilities: sauna boxes in private areas and sauna facilities in common areas.
In the case of rental properties, sauna facilities are increasingly being installed as a differentiation strategy to increase rent and occupancy rates.
As for investment properties, properties that aim to increase profitability by utilizing the added value of sauna facilities are attracting attention.
The primary advantage of choosing a single-family home with a sauna or a condominium with a sauna for residential use is the realization of a sauna experience in a private space.
Having a sauna in your home allows you to enjoy it whenever you want, without the need to leave the house.
This not only saves you the time and expense of commuting to a sauna facility, but also allows you to fully enjoy your sauna experience in a completely relaxed state, without having to worry about other users.
The health benefits are also not to be overlooked.
Regular sauna use can be expected to promote blood circulation, reduce stress, and improve sleep quality, making it a very effective means of managing health at home in today's world of telecommuting.
In addition, an environment where one can rest immediately after a sauna is an ideal condition for taking full advantage of the sauna's benefits.
On the other hand, there are some disadvantages to real estate with residential saunas that should be noted.
The most significant issue is the high initial cost.
Sauna installation costs range from 500,000 to 1.5 million yen for a simple sauna box, while construction of a full-scale sauna room requires an investment of 2 to 3 million yen or more.
Securing installation space is another important consideration.
Sauna facilities require a certain amount of space, which may be difficult to install depending on the layout and structure of the house.
In addition, sauna operation incurs ongoing electricity and maintenance costs, and these running costs must also be considered.
Furthermore, sauna facilities may be subject to legal regulations such as the Building Standard Law and the Fire Service Law, and sufficient legal confirmation is required before installation.
When operating a property as a sauna investment property, the biggest advantage is the effect of increased rent.
According to a market survey, a 10-20% increase in rent can be expected with the installation of a sauna facility, and more than 30% of prospective tenants are willing to accept a rent increase of 20,000 yen or more, especially if the sauna is in the private area.
Increased occupancy is another important benefit.
Properties with saunas are rare and have strong appeal as a differentiating factor.
This can be expected to shorten vacancy periods and provide stable rental management.
In addition, because of its strong appeal to a specific target group of sauna enthusiasts, it tends to lead to long-term occupancy.
The main disadvantage of investment properties is the long payback period for the initial investment.
The initial cost of installing sauna equipment is high, and even taking into account the effect of increased rent, it may take several years to a decade to recover the investment.
Maintenance costs are also an ongoing burden.
Because sauna equipment is used in a hot and humid environment, regular inspections and parts replacement are required, and these costs can drive up property operating costs.
In addition, the risk of a breakdown or malfunction of the sauna equipment should also be considered, as the property's attractiveness may be significantly reduced during the repair period.
Price quotes for single-family homes with saunas vary widely between new and used homes.
In new construction, sauna rooms can be incorporated from the design stage to ensure efficient placement and optimal equipment specifications.
The cost of installing a sauna in a new single-family home tends to be more cost-effective than a stand-alone installation because it is incorporated into the overall building design.
In a sauna renovation of an existing single-family home, a sauna space is created while utilizing the existing floor plan and structure.
In this case, design flexibility is more limited than with new construction due to structural constraints and the need to coordinate with existing facilities, but the total investment cost, including property acquisition costs, may be lower.
There are two approaches to sauna condominiums: installation in private areas and installation in common areas.
For installation in private areas, sauna box type facilities are the most common type of equipment.
These facilities can be installed in existing bathrooms and Western-style rooms, and can be installed in a relatively short period of time.
Prices range from 500,000 yen to 1.5 million yen, and vary widely depending on the installation area and functions.
When sauna facilities are installed in common areas, it is possible to add value to the entire condominium.
In this case, consensus building by the management association and large-scale construction work are required, but the appealing effect to all units is very high.
Sauna rental properties are attracting attention as a differentiation strategy in the rental market.
Sauna installation in rental properties is primarily an investment decision by owners to both increase rent and occupancy rates.
The cost of installing a sauna in a rental property is approximately 2 million yen per unit, and for this investment, a rent increase of approximately 20,000 yen per month can be expected.
The payback period for this investment is about 8 to 10 years, but if the effect of improved occupancy rate is included, payback can be achieved in a shorter period of time.
| Property Type | Installation cost | Expected Effect | Payback period |
|---|---|---|---|
| New single-family home | 1.5 million yen to 3 million yen | Increase in property value | -1.5 million yen |
| Used single-family home | 1,000,000 - 2,500,000 yen | Improvement of occupant satisfaction | -Residential |
| Condominium private area | 500,000 - 1.5 million yen | Quality of life improvement | -Rental properties |
| Rental property | Approximately 2,000,000 yen | 20,000 yen increase in rent | 8-10 years |
| Investment property | 2 million yen to 3 million yen | Yield increase | 10-15 years |
The most important indicator in evaluating the investment value of real estate with sauna is the effect of rent increase.
According to market research data, the introduction of sauna facilities can be expected to increase rents by 10% to 20% over conventional rents.
This effect tends to be more pronounced in high-end rental markets, especially in urban areas.
As a specific example, if sauna facilities are installed in a property with a monthly rent of 100,000 yen, the rent can be set at 120,000 to 140,000 yen.
This is a very attractive figure as an investment effect.
However, this effect varies greatly depending on the location, property grade, and target demographic, so individual market analysis is important.
Properties with saunas tend to maintain high occupancy rates due to their rarity.
While the average vacancy rate for a typical rental property ranges from 5% to 15% depending on the area, properties with saunas have the potential to significantly reduce vacancy rates.
This is due to their strong appeal to a specific target demographic: sauna enthusiasts.
In addition, residents who move in for sauna facilities tend to want to stay longer, thereby reducing tenant turnover costs.
Long-term occupancy provides the owner with the dual benefits of securing stable income and reducing management costs.
The decision to invest in sauna real estate requires a comprehensive evaluation of the initial investment, expected return, and payback period.
In the standard investment model, assuming a monthly rent increase of 20,000 yen (240,000 yen per year) for a sauna facility installation cost of 2 million yen, a simple calculation yields an investment payback period of approximately 8.3 years.
However, in actual investment decisions, it is necessary to take into account the effect of improved occupancy rates, reduced management costs due to long-term occupancy, and increased property value.
Including these secondary effects, the actual payback period may be reduced to 6 to 7 years.
In addition, sauna facilities provide a long-term competitive advantage as a property differentiator, and can be expected to increase the value of the property at the time of future sale.
There are some unique risk factors associated with investing in real estate with sauna facilities.
Repair costs due to equipment breakdowns and aging tend to be higher than for regular residential facilities.
Because sauna facilities are used in hot and humid environments, regular maintenance is essential, and these costs must be factored into the plan in advance.
Careful consideration must also be given to the sustainability of the sauna boom.
It is uncertain whether the current high demand will continue into the future, and there is a risk that changes in market conditions will reduce the return on investment.
Countermeasures against these risks include selecting highly reliable equipment, entering into regular maintenance contracts, and combining multiple differentiators.
Real estate with saunas offers a noteworthy investment opportunity in the current real estate market.
Demand for this sector is expected to continue to grow in the future due to increasing health consciousness and changing consumer needs for healing in a private space.
As an investment target, attractive profitability can be realized through proper market analysis and prudent investment decisions.
In particular, with the right location and target demographics, the performance of this sector can be expected to outperform traditional real estate investments.
The following factors are critical to success in real estate with saunas.
First, a detailed analysis of the target market should be conducted to accurately determine the quality and quantity of demand.
Second, in selecting equipment, carefully consider the balance between initial costs and running costs, and make decisions with an emphasis on long-term profitability.
It is also essential to ensure stable operation by appropriately complying with legal regulations and establishing a regular maintenance system.
If you are considering real estate with a sauna, we recommend that you begin by setting specific investment goals and a budget.
It is then important to conduct a professional market analysis and property evaluation to objectively verify the appropriateness of the investment.
INA&Associates K.K. offers professional sauna real estate consulting services and can assist you in selecting the property and developing an investment strategy that best fits your investment goals.
We are committed to helping our clients achieve both asset building and quality of life through the new investment opportunity of sauna real estate.
A1: The need for a building permit application for the installation of a sauna facility depends on the size of the installation and its intended use.
In the case of a sauna for home use, a building permit is basically not required if the additional area is less than 10 m2, but an application may be required if structural changes are involved or if the sauna is used for business purposes.
We recommend that you consult with an architect or government office before installation.
A2: Maintenance costs for sauna equipment vary widely depending on the type of equipment and frequency of use.
In general, you should expect to spend between 100,000 yen and 300,000 yen per year for maintenance.
This includes the cost of periodic inspections, replacement of consumable parts, and electricity.
Proper maintenance can extend the life of the equipment and control long-term costs.
A3: The tenants of properties with saunas tend to be health-conscious and have relatively high incomes.
The age range is mainly from 30s to 50s, and it is particularly popular among telecommuters, freelancers, and other professionals who spend a lot of time at home.
Demand is also very high among sauna enthusiasts (saunas), and these people tend to prefer long-term tenants.
A4: Yields on properties with saunas for investment vary greatly depending on the location and grade of the property.
Generally speaking, a sauna installation can increase the yield by 1% to 3% compared to conventional yields.
In the high-end rental market in urban areas, higher yields may be expected.
However, since the initial investment is high, it is important to make investment decisions from a long-term perspective.
A5: The asset value of a property with a sauna at the time of sale depends on market demand trends.
As long as the current sauna boom continues, a certain amount of added value can be expected as a differentiating factor.
However, future values may fluctuate as equipment ages and market trends change.
When considering selling, it is important to set an appropriate price based on market trends.