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Selling Property

Hong Kong - Selling Property

When it comes to selling a property in Hong Kong, most expats enlist the help of a real estate agent. Although you can also sell your property by yourself or at an auction, an agent can oftentimes make the process a little smoother and more straightforward. It is important to only work with licensed agents if you do decide to employ the assistance of one.

When you sign the estate agency agreement with the agent, you should pay careful attention to the amount of commission and time of payment; the agreement’s validity period; period of the agreement; if the relationship is a “non-exclusive agency” or “exclusive agency;” and whether or not the agent is acting only for you or also for the buyer. If your contract includes an exclusive agent, then your agent might charge you a commission even if the property is sold through another agent.

Once you and the buyer reach an agreed upon price, both parties enter into a provisional sale and purchase agreement. This is a legally binding contract that must be followed by both parties. If, for some reason, the formal sale and purchase agreement cannot be signed, either party can rely on the provisional agreement to proceed with the deal or even to sue for compensation. The provisional agreement includes certain information like the closing date, the address and price of the property, amount of initial and further deposit, when to sign the formal agreement, etc.

A solicitor should draft the formal sale and purchase agreement. The sale and purchase agreement is based on the terms set forth by the provisional agreement. This agreement contains detailed terms that are intended to replace those in the provisional agreement. Certain special conditions can be included as long as they do not infringe upon any relevant ordinances or oppose the terms of the provisional sale and purchase agreement.

As the seller, it is your responsibility to educate the buyer regarding any encumbrances against the property. These can include any lawsuits; unpaid management fees; mortgage over the property that hasn’t been discharged; government orders for remove of unauthorized building work; or repair works.

Even though the real estate agent or the buyer can find this information by carrying out a land search, it is still in the seller’s best interest to inform of all the encumbrances and negotiate with the purchaser regarding this. This can help avoid any future disputes, which could impede the sale process. It is also the seller’s duty to disclose the latent defects. These are any defects that the buyer cannot discover through a property inspection.

The Stamp Duty is imposed on the agreement for sale of residential property. Rates vary with the property’s amount or value. A new stamp duty, as of 2012, was imposed on foreigners who are buying property in Hong Kong. This amount is 15%.

Despite the fact that predictions were made that there would be a real estate slump following the implementation of the new stamp duty, there is still a fairly healthy real estate market in Hong Kong. It is expected that prices will drop in the near future but as of now there are still several thousand properties being sold every month.



Expat Health Insurance Partners


Aetna

Our award-winning expatriate business provides health benefits to more than 650,000 members worldwide. In addition, we have helped develop world-class health systems for governments, corporations and providers around the world. We want to be the global leader in delivering world-class health solutions, making quality health care more accessible and empowering people to live healthier lives.

Bupa Global

At Bupa we have been helping individuals and families live longer, healthier, happier lives for over 60 years. We are trusted by expats in 190 different countries and have links with healthcare organisations throughout the world. So whether you're moving abroad for a change of career or a change of scene, with our international private health insurance you will always be in safe hands.

Cigna

Cigna has worked in international health insurance for more than 30 years. Today, Cigna has over 71 million customer relationships around the world. Looking after them is an international workforce of 31,000 people, plus a network of over 1 million hospitals, physicians, clinics and health and wellness specialists worldwide, meaning you have easy access to treatment.