Full numbers from 3 rural minpaku properties: a leased + inn-license property paid back in 17 months on 3.45 million yen upfront — double the yield of a Housing Business Act property

Tetsujiro, who runs rural minpaku (private lodging) properties, has published revenue data for his three properties down to the yen. His note.com post, “Minpaku revenue simulation: the real income of 3 rural minpaku properties [published]” (posted February 11, 2025), links out to a Google Spreadsheet listing the breakdown of upfront investment, annual sales, every cost line, and payback period for each property.

What’s interesting is that despite all three being the same category, an unmanned detached house in a rural area used for minpaku, payback periods split as far apart as 35 months and 17 months. A twofold gap. We trace what created that difference using only the published numbers.

The three properties, side by side

Transcribing the spreadsheet’s figures directly:

The sales breakdown is disclosed too. Tetsujiro’s sales formula is “nights occupied × nightly rate + number of bookings × cleaning fee.” Property A: 15 nights/month at 30,000 yen, 10 bookings/month at 8,000 yen cleaning fee. Property B: 20 nights at 20,000 yen, 15 bookings at 7,000 yen. Property C: 20 nights at 22,000 yen, 15 bookings at 8,000 yen. Annualizing these: A comes to 5.4 million + 0.96 million = 6.36 million yen. B comes to 4.8 million + 1.26 million = 6.06 million yen. C comes to 5.28 million + 1.44 million = 6.72 million yen, all matching the published figures.

The cost side checks out the same way. A totals 4.964 million yen: cleaning 0.96 million, OTA commission 0.954 million (15% of sales), rent 2.16 million, utilities 0.48 million, fire insurance 0.05 million, consumables 0.12 million, contingency 0.24 million. C totals 4.238 million yen: cleaning 1.44 million, OTA 1.008 million, rent 0.9 million, utilities 0.48 million, insurance 0.05 million, consumables 0.12 million, contingency 0.24 million. The numbers close consistently with the table.

Where did the tide turn?

The turning point is clear: switching the model from A (leased, minpaku registration law) to C (leased, inn business license). Tetsujiro himself states his conclusion right up front in the post: “if you’re doing rural minpaku, leased + inn business license is the only way to go.”

The before-and-after numbers: Property A, the first one, has upfront investment of 4.036 million yen, annual profit of 1.396 million yen, a 34.6% yield, and a 35-month payback. Property C, the third one, has upfront investment of 3.4575 million yen, annual profit of 2.482 million yen, a 71.8% yield, and a 17-month payback. Upfront investment dropped by 580,000 yen, annual profit rose by 1.086 million yen, and payback time was cut to less than half. And this despite Property C’s nightly rate (22,000 yen) actually being lower than A’s 30,000 yen. Lower price, more profit.

Property B, purchased under an inn business license, posts the highest monthly profit of the three at 224,375 yen. But its 7.125-million-yen upfront investment weighs it down, keeping yield at 37.8%, barely different from A. “How much lands each month” and “how fast does the invested capital come back” are separate metrics, an obvious point, but one that’s easy to conflate, and it shows up clearly here.

Three structural factors behind the gap

Why is C faster? Breaking the numbers down reveals three distinct factors.

First, the cap on operating days. The minpaku registration law (Housing Business Act) caps annual operating days at 180. Property A’s “180 permitted / 180 actual” figures mean it’s already running at the legal ceiling. There’s no room to grow through higher occupancy, because that room doesn’t exist by law. B and C, both operating under an inn business license, can run 365 days a year and are currently at 240 actual days, still 125 days of headroom. Property A charging the highest nightly rate (30,000 yen) yet coming in lowest on annual sales reflects a regulatory ceiling, not a lack of effort.

Second, rent. Property A’s annual rent is 2.16 million yen, or 180,000 yen a month. In the body text, Tetsujiro writes: “for a rural detached house, market rent is typically around 50,000–100,000 yen a month,” adding, “my Property A’s rent is quite a bit higher than that, and it’s squeezing profit.” Property C’s rent is 900,000 yen a year (75,000 yen a month). The gap is 1.26 million yen a year, nearly identical to Property A’s entire 1.396-million-yen annual profit. If A’s rent matched C’s level, annual profit would climb to an estimated 2.656 million yen, cutting payback to roughly 18 months. Fixed costs, not price or occupancy, are the main reason A pays back slowly.

Third, a smaller denominator. Yield is profit divided by upfront investment, so shrinking the denominator moves the ratio even with the same profit. Property C keeps acquisition-side costs compressed relative to A and B, 457,500 yen in lease setup and 300,000 yen in renovation. Furniture and appliances alone stay close to A’s level (2.7 million yen vs. A’s 3 million yen), meaning the guest-facing experience wasn’t cut. This property’s design philosophy is clear about where to cut and where not to.

What isn’t working, and the risks carried

The article doesn’t hide the less flattering side of these numbers either.

Property B is a 60-year-old building that required 2.5 million yen in renovation. The listed items include “electrical work and repairs to termite-damaged flooring,” handled through a mix of outside contractors and DIY. Tetsujiro reflects: “during the renovation I was covered in dust and grime, thinking ‘when is this going to end,’ feeling like giving up out of loneliness more than once.” That 2.5 million yen was compressed through his own labor, fully outsourced, upfront investment would have run even higher. A payback of 32 months has hours of his own unpaid work baked into it that don’t appear in the spreadsheet.

Property B’s fire insurance also runs 286,000 yen a year, about six times the 50,000 yen for the two leased properties. Owning a property means bearing the cost of protecting your own asset, and that shifts the nature of the fixed costs involved.

For Property A, it reportedly took about six months from signing the lease to opening for minpaku business. “Since it was my first time, everything was trial and error.” Those six months are a period when only rent goes out, and they sit outside the stated 35-month payback window.

Furthermore, all three properties are calculated on the assumption of 180–240 occupied days a year. Rural tourism demand fluctuates heavily by season, and if actual occupancy falls short of projections, sales drop proportionally. The conservative 15% OTA commission assumption also becomes a squeeze if the mix shifts toward higher-fee channels like Booking.com.

How much of this can you copy?

What’s easy to reproduce is the cost-structure design. Keeping rent to 50,000–100,000 yen a month, using secondhand furniture and appliances (Tetsujiro himself writes, “for my next minpaku, even a similarly sized detached house could be done on a 1.5–2 million yen budget”), self-installing fire safety equipment to keep it at 100,000 yen, and handling permit applications yourself to save the 300,000 yen agency fee. These are all matters of judgment and effort, not capital.

Three things are harder to reproduce. One is finding a property where an inn business license is achievable at all. This runs into zoning restrictions and building-structure constraints, and requires a landlord willing to permit inn-business use of a leased property in the first place. Two is an area where demand supports a 20,000–30,000-yen nightly rate. Tetsujiro writes, “in the areas where I run rural minpaku, 20,000–30,000 yen a night is roughly the benchmark”, if that price premise breaks down, the entire calculation needs redoing. Three is an in-house cleaning network. Rural areas rarely have dedicated minpaku cleaning companies, so Tetsujiro directly recruited neighborhood homemakers and contracted with them, permitting them to bring their children along while cleaning to secure workers who’d otherwise struggle to work outside the home. That’s a system built through local roots, not something reproducible remotely.

One more point. The data from these three properties rests on the fact that “the projections I ran for the first property turned out to match actuals almost exactly.” Tetsujiro writes: “in practice, the revenue projection I ran beforehand and the actual revenue ended up remarkably close. Confirming that with the first property meant the projection accuracy kept improving with the second and third.” Fully validating the numbers with property one is what let him confidently change the model for property two onward. The 17-month payback wasn’t a sudden result on property three. It stands on the tuition paid with property A.

Note also that Tetsujiro’s profile states: “launched 3 unmanned minpaku properties in one year. 10 months as a minpaku host, 1.98 million yen in monthly sales, 1.02 million yen in profit,” with Airbnb reviews at 99 five-star ratings out of 101, averaging 4.98. Dividing the three properties’ combined annual sales of 19.14 million yen by 12 gives about 1.595 million yen a month, a different figure from the profile’s stated 1.98 million monthly sales. It’s natural to read the former as an annualized average and the latter as a specific month’s actual result.

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