Hong Kong » The Purchase Process

The process of purchasing property in Hong Kong is based on common law and is similar to that in England, the territory's former colonial ruler. There was some concern about property rights when China reclaimed Hong Kong in 1997, and then regained Macao from Portugal in 1999. But both cities operate as autonomous Special Administration Regions, and the change has had little overall effect on real estate markets.  

In Hong Kong, a buyer typically puts down 5 percent of the purchase price when a preliminary sales and purchase agreement is signed; another 5 percent is paid about two weeks later when a formal agreement is signed. The balance is due at closing - normally six to eight weeks later.

There are penalties for pulling out of a sale after the preliminary agreement is signed.

The broker's fee generally ranges from half a percent to 1 percent of the price; the lawyer's fee varies but usually is about 6,000 Hong Kong dollars.

Buying a property can produce a residence permit, if the purchase is costly enough.

In Hong Kong, the magic figure to invest is 6.5 million Hong Kong dollars, in any combination of property and financial instruments like stocks and bonds. Macao grants residence permits to people who invest 1 million patacas, or $120,000, in property and have another 500,000 patacas in fixed deposits at Macao banks.

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