Living
The Process
To buy property in Hong Kong, you must be 18 years or and a Hong Kong resident, whether you intend to inhabit the place or are buying as an investment opportunity.
When arranging for a mortgage, be sure to talk to several banks and compare interest rates and monthly payments. Many banks, including some government organisations like the Housing Authority (2712 2712) and Housing Society (2839 7888) offer attractive deals. The Hong Kong Mortgage Corporation (www.hkmc.com.hk) has a list of approved mortgage sellers that is worth a look through. Also, save yourself some hassle and hire a solicitor to handle your mortgage arrangement when you begin negotiations on a property deal.
Your property agent will prepare due diligence on the landlord, offer price comparison and then negotiate for you and set a date for the transaction. Once you are sure about buying the place and agree on the price with all terms and conditions understood and accepted, the agent prepares the offer letter and arranges for signing of the Provisional Sales and Purchase agreement. A deposit (5% of the sale price) is paid to the owner or owner’s solicitor. You are now bound to this deal.
If you change your mind, you lose the deposit and still have to pay the agent’s fee of 1% of the price.
Within 14 days, with the help of solicitors from both sides, the Formal Sales and Purchase Agreement is signed with another deposit of 5-10% making this deal legally binding and you will sign the Assignment Deed. By now the mortgage should be confirmed and the Mortgage Deed signed as well.
The process is complete within two to three months when the remaining amount is handed over to the owner’s solicitor. During this time, you can check the premises again to make sure it is in the condition as agreed upon in the terms. The owner’s solicitor will inform you about paying government rates and management fees. You will also have to pay stamp duty to the Inland Revenue Department.
Sometimes there is a pre-sale of apartments in a building under construction. These can be bought for your own use, to rent out or even to sell on and some people do this before they are even completed and still make a pretty profit. You must let the developer know when reselling as sometimes there are transfer charges and changes need to be made in the provisional title. To protect yourself in case the construction is never completed, you can ask for a guarantee from the developer’s solicitor.
A small deposit is made at the time of signing the Memorandum for Sale and after that both buyer and developer sign the Sales and Purchase Agreement, confirming the buying price and date of delivery. The final part of the transaction is the Assignment Deed, signed by both parties. An Occupation Permit is issued and the buyer takes possession of the property. The Hong Kong Land Office has to be notified of all transactions.
When arranging for a mortgage, be sure to talk to several banks and compare interest rates and monthly payments. Many banks, including some government organisations like the Housing Authority (2712 2712) and Housing Society (2839 7888) offer attractive deals. The Hong Kong Mortgage Corporation (www.hkmc.com.hk) has a list of approved mortgage sellers that is worth a look through. Also, save yourself some hassle and hire a solicitor to handle your mortgage arrangement when you begin negotiations on a property deal.
Your property agent will prepare due diligence on the landlord, offer price comparison and then negotiate for you and set a date for the transaction. Once you are sure about buying the place and agree on the price with all terms and conditions understood and accepted, the agent prepares the offer letter and arranges for signing of the Provisional Sales and Purchase agreement. A deposit (5% of the sale price) is paid to the owner or owner’s solicitor. You are now bound to this deal.
If you change your mind, you lose the deposit and still have to pay the agent’s fee of 1% of the price.
Within 14 days, with the help of solicitors from both sides, the Formal Sales and Purchase Agreement is signed with another deposit of 5-10% making this deal legally binding and you will sign the Assignment Deed. By now the mortgage should be confirmed and the Mortgage Deed signed as well.
The process is complete within two to three months when the remaining amount is handed over to the owner’s solicitor. During this time, you can check the premises again to make sure it is in the condition as agreed upon in the terms. The owner’s solicitor will inform you about paying government rates and management fees. You will also have to pay stamp duty to the Inland Revenue Department.
Sometimes there is a pre-sale of apartments in a building under construction. These can be bought for your own use, to rent out or even to sell on and some people do this before they are even completed and still make a pretty profit. You must let the developer know when reselling as sometimes there are transfer charges and changes need to be made in the provisional title. To protect yourself in case the construction is never completed, you can ask for a guarantee from the developer’s solicitor.
A small deposit is made at the time of signing the Memorandum for Sale and after that both buyer and developer sign the Sales and Purchase Agreement, confirming the buying price and date of delivery. The final part of the transaction is the Assignment Deed, signed by both parties. An Occupation Permit is issued and the buyer takes possession of the property. The Hong Kong Land Office has to be notified of all transactions.
