Japan homebuyers rethink mortgage plans as interest rates rise

More than three-quarters of prospective Japanese mortgage borrowers reported changing their financing plans in response to Bank of Japan (BOJ) interest-rate increases, according to survey findings released by the Japan Housing Finance Agency (JHF) on November 6, 2026.

The findings, based on a survey conducted between June 22 and July 3, show prospective buyers reconsidering borrowing amounts, mortgage-rate types and purchase timing.

How higher interest rates are changing borrowing decisions

The JHF survey found that 76.9% of respondents planning to purchase homes with mortgages within five years reported changes to their mortgage choices following BOJ policy-rate increases since March 2024.

Photo by Beatriz Cattel on Unsplash

Reducing the planned borrowing amount was the most common response, selected by 31.4% of respondents. Another 17.4% were considering switching from variable to fixed interest rates, while shortening repayment periods was also among the leading adjustments.

The responses suggest that prospective borrowers are reassessing both the size and structure of their financing commitments.

The questionnaire permitted multiple answers, meaning respondents could report more than one adjustment. Although participants reported changes to their mortgage choices, the specific responses largely describe decisions under consideration rather than completed borrowing transactions.

The findings also reflect conditions when the survey was conducted, not subsequent BOJ decisions in September or October.

Homebuyers face competing financial pressures

Interest-rate increases are also influencing when prospective purchasers intend to enter the housing market.

In a separate question, 72.0% reported changes to their home purchase plans following BOJ policy-rate increases. Among all respondents, 21.4% were considering bringing forward their purchases, while 20.1% were considering postponement.

The opposing responses illustrate how higher interest rates can accompany different purchasing decisions. Some prospective buyers are considering accelerating their plans, while others are reassessing their schedules.

Housing prices create another pressure. Among respondents who considered the coming year a favorable time to buy, expectations of rising property prices were among the leading reasons, alongside anticipated mortgage-rate increases.

Conversely, high property prices were the most cited reason among respondents who considered it an unfavorable time to purchase.

These findings come from separate questions and do not establish how individual households ultimately balanced borrowing costs against property acquisition costs.

Meanwhile, variable-rate mortgages remained prevalent among a separate group of recent borrowers. Variable-rate loans accounted for 66.9% of mortgages obtained by those respondents, even though 71.3% expected mortgage rates to rise over the following year.

The survey used an online respondent panel rather than a representative sample of all mortgage transactions. JHF also changed its survey contractor, respondent pool and portions of its questionnaire in 2026, limiting direct comparisons with earlier results.

The findings illustrate how prospective homebuyers are reconsidering borrowing amounts, financing structures and purchase schedules as interest rates and housing prices shape different aspects of their decisions.

Further Reading:

Japan Housing Finance Agency - Mortgage Borrower Survey Results, November 6, 2026 Press Release (Japanese only) 

Japan Housing Finance Agency - Prospective Mortgage Borrower Survey, June 2026, Detailed Results (Japanese only)

Japan Housing Finance Agency - Mortgage Borrower Survey Archive (Japanese only)