Hong Kong Property Sale Buying Process Procedure

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Hong Kong Property Sale Process

Once negotiations have come to a conclusion and there has been Agreement on the Price and General Terms and Conditions including the Completion Date. Purchasers of Residential Property in Hong Kong will enter into a Provisional Agreement for Sales & Purchase (PASP) with the Vendor. Upon entering into this Agreement, the norm is for 5% of the transaction price to be provided, either to the Vendor or to the Vendor’s solicitor.


The Formal Sale & Purchase Agreement (SPA) is usually signed within 14 days of signing the Provisional Agreement. The Vendor’s solicitor will prepare a draft Formal Agreement for Sale and Purchase and send the same to the Purchaser’s solicitor for their approval. A further 5% of the transacted price will normally be provided at this stage amounting to 10% in total.


After the SPA, both Parties’ solicitors will normally require up to one (1) month to complete the Title checking, Transaction and for the Drawdown of the mortgage to take place. On the Completion date the balance of the Purchase Price is transferred to the Vendor’s solicitor. On or before this point the Purchaser is entitled to a Final Inspection to verify the Vendor’s ability to deliver Vacant Possession (and other basic details as specified in the PASP & SPA).
After all costs have been settled and all documentation received and accounted for, the keys can be released through the Agent or Solicitor to the Purchaser at a specified time.


Hong Kong’s Conveyancing Process is relatively straight forward when compared to other Developed Markets. Our Hong Kong Realty Agents along with your Appointed Solicitor will walk you through the process start to finish. From the outset it is crucial that you are aware of all Encumbrances, Building Orders or Bad Title. The Agent is responsible for providing you with an updated Landsearch for the relevant premises before the signing of the Provisional Agreement, which will illuminate any such issues. Illegal structures in Hong Kong are relatively common and we have experience in discharging such orders and locking-in value but this very much dependent on the circumstances.  Also we will be able to help you with Bank Valuations and your Stamp Duty liabilities


Do also bear in mind that Insurance should be put in place to cover your liabilities against the mortgage for Fire and Owner Liabilities. Other areas which require consideration include Home Contents and Buildings Insurance. Contact us directly for access to our Insurance Partners.

Stamp Duty

On Sale or Transfer of Immovable Property in Hong Kong

http://www.ird.gov.hk/eng/ese/sd_comp/sdpt.htm

With effect from 1 April 2010, stamp duty on sale of immovable property in Hong Kong is charged at rates which vary with the amount or value of the consideration as follows:

(Where the stamp duty calculated includes a fraction of $1, round-up the duty to the nearest $1.)

Amount or value of the consideration

Rate

Exceeds

Does not exceed

 

$2,000,000

$100

$2,000,000

$2,351,760

$100 + 10% of excess over $2,000,000

$2,351,760

$3,000,000

1.5%

$3,000,000

$3,290,320

$45,000 + 10% of excess over $3,000,000

$3,290,320

$4,000,000

2.25%

$4,000,000

$4,428,570

$90,000 + 10% of excess over $4,000,000

$4,428,570

$6,000,000

3%

$6,000,000

$6,720,000

$180,000 + 10% of excess over $6,000,000

$6,720,000

$20,000,000

3.75%

$20,000,000

$21,739,120

$750,000 + 10% of excess over $20,000,000

$21,739,120

 

4.25%

Inland Revenue Department. The Government of the Hong Kong Special Administrative Region.

 

 

 

 

 

 

 

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Hong Kong Property Sale Buying Process Procedure Hong Kong Property Sale Buying Process Procedure