The cost of starting a minpaku / kominka in Toyama
The cost of starting a minpaku in Toyama: look at construction and everything else separately
Our example, a 90-year-old house in Toyama turned into a guesthouse, took 4 months and ¥9 million in construction. Besides construction you pay for bedding, tableware and other furnishings, fire-safety equipment and the running of the guesthouse. Here are the real figures and a guide by part.
Our example, a 90-year-old house in Toyama turned into a guesthouse, took 4 months and ¥9 million in construction.
As a guide by part: insulation ¥2–5 million, a full set of plumbing ¥3–6 million, re-roofing ¥2–4.5 million (construction costs).
On top of construction come bedding, tableware and other furnishings, consumables, fire-safety equipment and booking-site fees.
If we run it for you there is no fixed monthly charge, and no operating fee in a month with no revenue.
A notified minpaku can operate up to 180 days a year. Beyond that you need a hotel business licence, and the construction cost changes.
More people ask us every year about turning a kominka into a guesthouse. We have taken a 90-year-old house in Toyama through the filing under the Private Lodging Business Act (the law that sets the rules for minpaku) and opened it as a minpaku (a house where travellers stay). We handle not only the construction but the filing and the fire-safety requirements with you. After opening, we take on the running of it as a minpaku operation service.
Example: what it cost to turn a 90-year-old house into a guesthouse
Before
→
Opened as a guesthouse
Construction period4 months
Construction cost¥9 million
Main worksInsulation; two new shower rooms, toilets and washbasins; upstairs floors, walls and ceilings; exterior walls
We removed the tatami room's ceiling to expose the beams and made it a stairwell linking the two floors. The weight of the thick beams and log posts is what gives the guesthouse its value. The money went into insulation, plumbing, the floors, walls and ceilings upstairs, and the exterior walls.
Among our projects in Toyama, a two-month living-dining-kitchen renovation also came to ¥9 million. The length of the work and the cost do not rise together; what decides the cost is what you spend the money on. The details of the work are in Project 01.
Construction cost guide by part
Spot repairs (a leak, inner windows, one bathroom)from a few hundred thousand yen
Insulation (inner windows, underfloor, ceiling / whole house)¥2–5 million
Seismic reinforcement (walls, hardware, foundation)¥2.5–7 million
Re-roofing (tiles, snow measures)¥2–4.5 million
Full plumbing set (bathroom, kitchen, toilet)¥3–6 million
Full renovation (130–200 ㎡)¥15–30 million
* All are construction-cost guides from our own projects. They exclude the price of buying the land and house, registration, taxes and other fees, and vary with the condition of the building and the scope of work. Foundations, roofs and termite damage in particular cannot be confirmed until they are opened up, so at the rough-estimate stage we tell you first which items could come in above the quote.
When turning a house into a guesthouse, insulation (keeping outside cold and heat from getting in) comes first. A cold guesthouse gets no winter bookings, and our example had its insulation done first. Roof snow, frozen pipes and the rest of the winter routine are in Running a minpaku through winter, and three projects' costs side by side are in Costs and typical prices.
Costs on top of construction
Bedding, and furnishings such as tableware and furniture. Budget for these as start-up costs
Fire-safety equipment. Our example has exit signs, smoke detectors and fire extinguishers
Consumables and repair materials
Booking-site fees. These are paid to the booking site and are separate from our operating fee
Winter snow clearing and frost protection. Hiring someone to clear the roof is about ¥30,000–80,000 a time
For guesthouses we run, we write down what will be needed before you start. The quote is free, and there is no charge if you decline.
As a way in that avoids booking-site fees, we build the guesthouse its own website and official LINE account, so guests who have stayed once can book directly next time.
The fee for having us run it
We are registered as a private-lodging management operator (a nationally registered business entrusted with running minpaku; Minister of Land, Infrastructure, Transport and Tourism (01) No. F06163), so we can take on the management after the filing, not just the construction. Our operating fee has no fixed monthly charge and is paid only from revenue: we take an agreed percentage of the lodging revenue. In a month with no revenue there is no operating fee.
We do not advertise a flat "X% of revenue", because the work depends on how often the house is cleaned and how much repair is included. The percentage is set for each property after we see it, and put in writing before you start. Details are in Minpaku operating costs (the fee).
Plan a guesthouse without thinking through how it will be run, and you can end up with plenty of guests but no money left over. So we plan with the operation in mind from the start, and decide the layout at the design stage with that in mind.
Minpaku filing or hotel licence: the construction cost changes
Using the Private Lodging Business Act, you can operate a house as lodging while it stays classed as housing. But you're limited to 180 days of operation a year. Get a hotel business licence (the licensing system for operating as a ryokan or hotel) instead and there's no day limit, but the requirements for the building and the construction cost both change. Which way to go is something we decide after looking at the location, your goals, and the occupancy rate you expect. The equipment required also changes with the floor area and with whether it's a host-resident minpaku.
The filing is in the owner's name; the management is in the registered operator's name. Who does what, and in what order, is set out in Filing to start a minpaku in Toyama.
Room rates and a rough payback calculation
A Hokuriku kominka let whole to one group is usually priced at around ¥30,000 to the ¥60,000s a night. Below, using a rough calculation we deliberately kept low, is how long it takes to recover a ¥5 million renovation for each use.
Let as a home (rent ¥50,000 a month)About 8 years
Let as a shop (rent ¥80,000 a month)About 5 years
Whole-house guesthouse (¥30,000 a night × 10 nights a month)About 1.5 years
* This is not a promise of income or of a payback period. It is a rough calculation that ignores expenses, empty nights and seasonal swings. Real results vary widely by property and location. The same calculation is shown as a chart in Putting a vacant house to use without selling.
Where a guesthouse works in Toyama
Is it on the way to Tateyama and Kurobe? Namerikawa, Uozu, Kurobe and Tateyama town pick up passing demand
Is it near a townscape people already visit, such as Gokayama in Nanto or Yamachosuji in Takaoka?
Driving time from the airport and the shinkansen station — overseas visitors mostly travel by rental car
Winter snow. If you operate year-round, snow clearing has to be part of the operating plan
Informing the neighbours. The filing requires consideration for nearby residents
Where no one comes, a guesthouse will not fill. If that is the case, we say so at the first site visit.
Still looking for a house?
Among the houses we have bought there may be one suited to a guesthouse. Before you buy, we check with you whether the layout, road access, water and sewer, and fire requirements can be met. Accompanied viewings are free.
FAQ
How much does it cost to turn a kominka into a minpaku?＋−
In our own example, a 90-year-old house in Toyama took 4 months and ¥9 million in construction. The work covered insulation, two new sets of shower room, toilet and washbasin, the floors, walls and ceilings upstairs, and the exterior walls. As a guide by part: insulation ¥2–5 million, a full set of plumbing ¥3–6 million, re-roofing ¥2–4.5 million. All are construction costs and vary with the condition of the building and the scope of work.
What do I pay for besides construction?＋−
Bedding, tableware, furniture and other furnishings, consumables, fire-safety equipment and booking-site fees. In winter, snow clearing and frost protection are budgeted separately too; hiring someone to clear the roof is about ¥30,000–80,000 a time. For guesthouses we run, we write down what will be needed before you start.
If you run it for me, what do I pay each month?＋−
There is no fixed monthly charge. We take an agreed percentage of the lodging revenue, paid only from revenue, so in a month with no revenue there is no operating fee. The percentage is set for each property after we see it, and put in writing before you start. Actual costs such as bedding, consumables and repair materials are separate.
How many years until the renovation pays for itself?＋−
We cannot promise anything. In a rough calculation we deliberately kept low, a ¥5 million renovation let as a whole house at ¥30,000 a night for 10 nights a month is recovered in about a year and a half. It ignores expenses, empty nights and seasonal swings, and real results vary widely by property and location.
A house guests can stay in
We check whether this house can be a guesthouse.
We start by checking whether the filing can be approved. You don't need to have chosen a house yet.
