“Zoning Districts”: Essential Knowledge for Anyone Starting a Vacation Rental

“Zoning districts” are essential knowledge when running a vacation rental. You’ve probably heard the term before, but many people aren’t quite sure what it actually means. In this article, we’ll take a detailed look at which zoning districts allow vacation rental operations, along with the different types and key points to watch out for.

What Exactly Are Zoning Districts?

Zoning districts are rules established under the City Planning Act that define how land can be used and what types of buildings can be constructed on it. They exist to promote appropriate land use and protect the living environment and urban functions.

When considering starting a vacation rental, you need to check which zoning district your property falls under. Since vacation rental operations are restricted in certain areas, it’s essential to select a property in an appropriate zoning district.

Which Zoning Districts Are Relevant to Vacation Rentals?

Under the City Planning Act, zoning districts are divided into the following 13 categories. Of these, vacation rental operations are permitted in all 12 categories except Exclusive Industrial Districts.

• Category I Exclusively Low-story Residential Zone
• Category II Exclusively Low-story Residential Zone
• Category I Exclusively Medium-to-high-story Residential Zone
• Category II Exclusively Medium-to-high-story Residential Zone
• Category I Residential Zone
• Category II Residential Zone
• Rural Residential Zone
• Quasi-Residential Zone
• Neighborhood Commercial Zone
• Commercial Zone
• Quasi-Industrial Zone
• Industrial Zone
• Exclusive Industrial Zone (vacation rentals not permitted)

In theory, vacation rental operations are possible in every zoning district except exclusive industrial zones. However, the actual scope of what’s allowed varies depending on your operating method and local government ordinances. This means it’s crucial to check in advance which zoning district suits your intended operation plan.

3 Operating Methods Where Zoning Districts Matter

As explained above, vacation rentals are generally permitted in all zoning districts except exclusive industrial zones out of the 13 categories. However, this can also vary depending on your operating method. Specifically, there are three main approaches:

1. Under the Minpaku Act (Private Lodging Business Act)
2. Under the Hotel Business Act
3. Under the National Strategic Special Zone system

Since the setup process differs for each, refer to the article below if you’d like more details.

[Related Article] How to Start a Vacation Rental: Steps, Tips for Success, and Pitfalls to Avoid

1. Operating Under the Minpaku Act (Private Lodging Business Act)

The following zoning districts allow operation under the Minpaku Act (Private Lodging Business Act):

• Category I Exclusively Low-story Residential Zone
• Category II Exclusively Low-story Residential Zone
• Category I Exclusively Medium-to-high-story Residential Zone
• Category II Exclusively Medium-to-high-story Residential Zone
• Category I Residential Zone
• Category II Residential Zone
• Rural Residential Zone
• Quasi-Residential Zone
• Neighborhood Commercial Zone
• Commercial Zone
• Quasi-Industrial Zone

The Minpaku Act was established to promote lodging businesses that make use of existing residential properties. Vacation rental operations are permitted in every zoning district except exclusive industrial zones. That said, the property must serve a residential purpose. Specifically, the following building types qualify:

• Detached houses
• Apartment buildings
• Dormitories
• Row houses

Benefits and Cautions of the Minpaku Act

The main benefit of the Minpaku Act is that it allows vacation rental operations in nearly every zoning district. However, local governments each have their own ordinances, which can place additional restrictions on operations. For example, some areas may prohibit operations entirely, while others may limit the number of operating days per year.

This makes it essential to check the zoning district of your property in advance. You can look up the zoning district for your area, or any area you’re considering, using online search services.

[External Site] Zoning District Map

2. Operating Under the Hotel Business Act

“Simple lodging-style” vacation rentals under the Hotel Business Act are permitted only in the following zoning districts:

• Category I Residential Zone (3,000㎡ or less)
• Category II Residential Zone
• Quasi-Residential Zone
• Neighborhood Commercial Zone
• Commercial Zone
• Quasi-Industrial Zone

Requirements and Features of the Hotel Business Act

If you operate under the Hotel Business Act, you’ll need to change the building’s designated use to “hotel” or “ryokan (Japanese inn).” This means going through a use-change procedure for the property, which typically requires the help of a specialist such as a gyoseishoshi (administrative scrivener).

The advantage of operating under the Hotel Business Act is that you can operate 365 days a year, making it easier to generate revenue. The downside is that the procedures are more complex and the eligible zoning districts are more limited. Since the benefits are considerably greater, if your property is in an eligible zoning district, it’s well worth pushing through the more complex procedures.

3. Operating Under the National Strategic Special Zone System

Special zone vacation rentals (tokku minpaku) are a style of operation permitted only in areas designated as National Strategic Special Zones. The following local governments currently permit this type of operation:

• Ota Ward, Tokyo
• Osaka Prefecture
• Osaka City
• Kitakyushu City, Fukuoka Prefecture
• Niigata City, Niigata Prefecture
• Chiba City, Chiba Prefecture

Features and Operating Conditions of Special Zone Vacation Rentals

Special zone vacation rentals can operate 365 days a year, under rules similar to those of the Hotel Business Act. However, the eligible areas are limited, and nationwide, only a handful of locations qualify.

Even in Zoning Districts That Allow Vacation Rentals, Check Local Ordinances Carefully

Even in zoning districts where vacation rentals are officially permitted, local ordinances may still impose additional restrictions on operations. Since some areas or time periods may prohibit vacation rentals altogether, it’s important to check in advance.

Example: Shibuya Ward

In Shibuya Ward, Tokyo, vacation rental operations are prohibited in exclusively residential zones and educational districts during the following periods:

• April 6 – July 20
• August 29 – the Wednesday of the week before the second Monday of October
• The Saturday of the week before the second Monday of October – December 25
• January 7 – March 25

[Reference] Shibuya Ward – About the Private Lodging Business (Minpaku)

These restrictions are aimed at preserving the living environment and ensuring children can feel safe in their surroundings. Some local governments even prohibit vacation rental operations within 100 meters of schools or nursery schools.

Since vacation rental ordinances differ from one local government to another, be sure to carefully check the regulations for your intended operating area before submitting your application. We recommend checking local ordinances online, since many are available to browse there.

Even in Areas Where Vacation Rentals Are Prohibited, “Special Use Districts” May Allow Exceptions

Even in areas where vacation rentals are not normally permitted, operation may become possible if the area is designated as a “special use district.”

What Is a Special Use District?

A “special use district” is a designation that municipalities can apply, under their city planning authority, to either strengthen or relax the standard rules of a zoning district. Even in areas where vacation rentals are generally prohibited, local ordinances may still permit them within a special use district.

Areas with high tourism demand, or those included as part of tourism promotion initiatives, are sometimes designated as special use districts. In such cases, vacation rental operations may be permitted beyond the usual restrictions of the standard zoning district.

How to Check the Zoning District of a Property

To find out whether a property is located in an area where vacation rentals are permitted, try one of the following methods:

1. Check the local government’s official website for zoning district information.
2. Contact a real estate agent to confirm whether a property is eligible for vacation rental operations.
3. Consult a vacation rental management company for proper, expert advice.

2 Ways to Check the Zoning District of a Vacation Rental Property

Some of you may be wondering, “How do I actually go about checking a zoning district?” Here are two effective methods for finding out the zoning district of a vacation rental property.

1. Ask Your Local Government

The simplest way to get zoning district information is to contact your local government directly. Here’s roughly what the process looks like after you reach out.

Search “[Municipality Name] + Zoning District”

For example, searching “Ota Ward, Tokyo zoning district” will show you that the “Building Inspection Section, Building Guidance Division” is the department in charge.

Contact the Relevant Department

Once you’ve identified the relevant department, reach out via their contact form or by phone and provide the property’s address or lot number. The local government representative will then check whether the property falls within a zoning district where vacation rentals are permitted.

2. Use a Zoning District Map or Local Government Map

If contacting your local government feels like too much hassle, you can instead use an online “Zoning District Map” or a “Local Government Map.”

・Zoning District Map
This lets you easily check zoning districts anywhere in the country. Even if you’re considering a vacation rental in a distant area, you can check the zoning district of your target location online.

・Local Government Map
By using the maps published on municipal or prefectural government websites, you can pinpoint the zoning district of a specific area.

Both tools are free to use, making it easy and convenient to carry out your research.

Zoning District Map
Local Government Map

[In Closing] Talk to Stay Buddy for Everything from Zoning District Checks to Full Vacation Rental Management

Having a solid grasp of zoning district rules and local ordinances can significantly boost your chances of success as a vacation rental host. Be sure to gather this essential information thoroughly, whether by contacting your local government directly or by using a zoning district map.

If you need support navigating complex procedures or legal matters, we also recommend working with an experienced gyoseishoshi (administrative scrivener), who can help you start your vacation rental business with greater peace of mind. At Stay Buddy Inc., we offer comprehensive support, from checking zoning districts all the way through to full-scale vacation rental management. If you’re interested, please feel free to reach out to us for a consultation.