Hong Kong Apartment Rental Process Procedure

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Hong Kong Apartment Rental Process Procedure

Rental Procedures & Agreements

In most cases, you will be required to sign an Offer Letter/ Provisional Agreement and pay a Holding Deposit, normally equivalent to one (1) month’s rent. The holding deposit will be absorbed into the full security deposit or be taken as the first month’s rental once the tenancy agreement is signed. Basically, this step ensures that the premise cannot be leased to anyone else. This agreement may or may not be subject to contract. If it is not, you will be obligated to rent once the landlord has accepted your offer to lease.
Under a Tenancy, the Tenant and Landlord will then enter into a Tenancy Agreement (TA) for Residential Property. Most standard Tenancy terms are relatively short and the norm will be for a period of Two(2) years.
However, both parties will usually have the option to break the lease after twelve (12) by serving two (2) months’ notice to the other party or two (2) months’ rent in lieu; minimum stay is fourteen (14) months.  The majority of Tenancies will require the Tenant to pay two (2) months’ rent as the security deposit and one (1) month rent in advance upon signing the Formal Tenancy Agreement. Both parties sign two copies of the contract (signed in duplicate) – one is kept by the landlord, the other by the tenant. Documents must be sent to the Inland Revenue to be officially registered and stamped, they will then be returned to the landlord and tenant.
After which, the key(s) will be arranged to be handed over to the tenant on the commencement date as stated in the Tenancy Agreement. There may also be a rent-free period at the start of the Tenancy, this will be stated in the preliminary and formal agreements. During this period the tenant will be able to move in furniture and fit-out the premises, without having to pay rent. All decoration/ alterations will have to be done in accordance with the landlord’s terms and conditions. Rest assured our agents are renowned for their ability to strike the best deal for you!

Handover

On the handover day, we will carry out a thorough inspection of the property to ensure that any furniture, fixtures, fittings and appliances are in the agreed condition and the apartment is in a safe and tenantable condition. We will also help our clients keep a record of utility readings in case of any future dispute. This will take place at the same time as the inventory inspection and attached the same to the TA detailing furniture and fittings supplied with the property.
In most cases, the Tenant will be required to put necessary utilities and services into their name and under their consumership. Including but not limited to gas; water; electricity; telephone; TV/ Internet. This process is straightforward but once again we are here to help you through this process, with access to application forms and online resources.


Stamp Duty

Stamp duty is a one-off tax payable to Hong Kong’s Inland Revenue Department. The norm in Hong Kong is for both parties to pay the stamp duty fees in equal proportion. This is required in order for the agreement to be registered with the Land Registry.
Lease
For lease of immovable property in Hong Kong, stamp duty is calculated at rates which vary with the term of the
http://www.gov.hk/en/residents/taxes/docs/IRSD123_0310(e).pdf

 

Term   Rate
Not Defined or is uncertain  0.25% of the yearly or average yearly rent
Exceeds Does not exceed  
  1 year 0.25% of the total rent payable over the term of the lease
1 year 3 years 0.5% of the yearly or average yearly rent
3 years   1% of the yearly or average yearly rent
Key money, construction fee etc mentioned in the lease   4.25% of the consideration if rent is also payabe under the lease.  Otherwise, same stamp duty as for a sale of immovable property

 

 

 

 

 

 

 

 

 

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Hong Kong Apartment Rental Process Procedure Hong Kong Apartment Rental Process Procedure