The Japan Housing Finance Agency (JHF) announced on March 21st that since the launch of its "Flat 35 Childcare Plus" program on February 13, 2024, approximately 63% of all Flat 35 mortgage loans have incorporated the benefit.
By the end of February 2025, 18,830 of the 29,996 executed Flat 35 loans included the Childcare Plus interest rate reduction.
Interest Rate Reduction Details
The Childcare Plus initiative grants borrowers one point per child, with each point reducing the home loan's interest rate by 0.25% for the first five years.
On average, borrowers utilized 1.7 points. Borrowers-by-points breakdown is as follows:
1 point: 48.8%
2 points: 34.3%
3 points: 13.4%
6+ points: 0.3%
Additional Interest Reduction Options
When combined with other housing performance-related (ZEH) interest reductions, the average total points accumulated reached 3.7.
More than half of borrowers (53.9%) secured four or more points, qualifying for a 1.0% annual interest rate reduction over five years.
Borrower Motivations
Among Flat 35 users, 22.3% cited the "interest rate reduction based on the number of children" as a key factor in selecting this mortgage option.
Many borrowers expressed appreciation for financial support tailored to child-rearing households, with larger families particularly benefiting from the reductions.
What is Flat 35?
Flat 35 is a long-term, fixed-rate mortgage offered in Japan through a partnership between private lenders and the government-backed Japan Housing Finance Agency (JHF).
Unlike variable-rate mortgages, Flat 35 provides borrowers with a stable interest rate for the entire loan term, which can range from 15 to 35 years.
The program is designed to make homeownership more accessible by offering predictable payments and special incentives, such as interest rate reductions for energy-efficient homes and families with children.
Further Reading:
Flat 35 Childcare Plus Information Page (Japanese only; outlines how the Childcare Plus points can be added to other point-accumulating offers like ZEH properties to add to interest rate deductions.)
Source:
R.E. Port News (Japanese only)
