Key money is pronounced “Reikin 礼金” in Japanese, which literally means “Thank You Money”.  So why do you have to thank your landlord by paying key money on top of your rent itself, when you are renting an apartment in Japan?  In old times especially during the period of high economic growth in 50’s through 70’s, constant shortage of apartment supplies was prevalent across the whole nation. As a result, landlords in those days had so much bargaining power to set terms and conditions on a leasing contract to profit their own on top of rent itself.  One of those byproducts was “key money”. It was originally designed to secure a property of your interest, when you are in house hunting  — Landlords simply turned you down, if you were not willing to pay “key money”

Today, it simply became a business practice that everybody follows, although the bargaining power of landlords that were once much more aggressive has gone down quite a bit. With this in mind, maybe you can try to negotiate with your landlords to remove “key money”, as you may have more bargaining power vs your landlords unlike the old times. Or you can rent through KaguAruoo where “Thank You Money” is never charged.