As sales of Japan’s temples and shrines soar, crackdown on bad-faith buyers By Reuters

By Mariko Katsumura

SANBAGAWA, Japan (Reuters) – The dilapidated 420-year-old temple of Benmou Suzuki, located deep in the forest near a small Japanese mountain village, shows almost no real estate of value.

However, the monk was recently approached by two men who said they were real estate brokers and wanted to know if he was interested in selling.

He suspects they weren’t really interested in the ornate building at the top of a sacred mountain, but in the special tax status that comes with managing a religious property.

“There are people there who want a temple, even a mountain temple like this. In fact, given the value of the religious corporation status, this temple could bring quite a lot of money,” said Suzuki, 52. years.

As Japan’s population shrinks and interest in religion wanes, fewer people contribute to the upkeep of the country’s many temples and shrines. Suzuki’s Mikaboyama Temple, for example, is located in Sanbagawa—an area three hours’ drive from Tokyo with just 500 residents that also has three other Buddhist temples, a Shinto shrine, and a church.

An increase in the number of religious properties being put up for sale has caused Japanese authorities to worry that potential buyers are not interested in them for heavenly purposes. Rather, they fear that many want to avoid taxes or possibly even launder money.

“It’s already a sense of crisis for us and the religious community,” said an official at Japan’s Cultural Affairs Agency, which oversees religious sites.

Instances where temple or shrine properties were widely reused sparked public outrage. In Osaka, a temple sold in 2020 was later destroyed and dozens of graves moved to make way for a real estate development. In Kyoto, a case of a temple that was demolished and turned into a parking lot made headlines this year.

Owning a temple, shrine or church recognized as a religious corporation in Japan can offer considerable tax advantages. Businesses within such corporations that provide religious services, such as funerals, do not have to pay taxes, while other non-religious businesses also enjoy preferential tax rates. A wide range of businesses are allowed, from restaurants to hair salons to hotels.

Japan had about 180,000 religious websites with corporate status at the end of 2023, according to agency data. The number of so-called inactive corporations – such as those that have not held religious events for more than a year – rose by a third to more than 4,400.

When monks or priests die without a successor, the overseeing religious group will usually appoint someone to take over or voluntarily renounce the site’s corporate status.

However, there are about 7,000 religious sites that operate independently of these groups and are considered easy to acquire, according to the agency and specialist brokers.

The cultural affairs agency said it had stepped up efforts to dissolve the corporate status of inactive religious sites to prevent them from being targeted by dodgy buyers.

And when large earthquakes strike, which often damage temples and shrines, agency officials visit religious groups in those areas, warning them that they will fall prey to such buyers.

Last year, 17 religious corporations were voluntarily dissolved and six were ordered to dissolve. The agency said the number will increase this year and next as it increases scrutiny.

It might seem easier for Japan to change its laws to more tightly control the criteria for buying religious sites. But the agency said the government is wary of changing religion-related laws because it could be seen as an encroachment on religious freedom, which is guaranteed by Japan’s constitution.

Reuters checks of six websites specializing in brokering the sale of religious properties showed hundreds on the market. Most are described online only obliquely, with brokers saying sellers prefer to conduct sales as privately as possible.

Osaka-based broker Takao Yamamoto told Reuters interest was growing. A religious corporation license alone can fetch 30 million yen ($210,000), he adds. Some religious sites, especially those with profitable cemeteries, are advertised for millions of dollars.

“Anyone can buy independent sites as long as you have money… even foreigners can buy them. Recently, many Chinese are trying to buy them,” Yamamoto said.

For his part, Suzuki says he has no intention of selling the Mikaboyama temple and is working on ideas to raise funds to maintain it. “Temples are places where local people can gather and bond. We just can’t get rid of them,” he said.