The buyer`s lawyers will then draw up a formal sales contract based on the results of the due diligence. As soon as both parties accept the form and content, it is executed and registered with the cadastre. In the Hong Kong real estate market, it is common for sellers and buyers to enter into a preliminary agreement on the sale and purchase (« provisional agreement ») of real estate, either through real estate agents or lawyers. Although there are no standard forms, the following forms are usually provided or processed in the provisional agreement: Although the real estate agent or buyer can verify the above information through a land search (if the charges have been entered in the cadastre), it is in your interest to detect all charges and negotiate with the buyer in order to avoid subsequent disputes, which could hinder the sales process. In addition, you have an obligation to reveal hidden defects that a buyer cannot identify by properly examining the property. The property is sold to the buyer « as we will see ». The property is sold and delivered to the buyer in the condition that is at the time of signing the contract at the time of signing the contract. It should be noted that selling on a « as will be seen » basis does not protect the seller from disclosure of the existence of unauthorized modifications or structures regarding the property. If the buyer does not accept such unauthorized constructions or modifications, he may, on this basis, contest the ownership of the property. If a buyer acquires real estate (including commercial or residential property) through the transfer of shares of a limited liability company, the current stamp duty on each note purchased and sold is 0.1% of the higher purchase price or net asset value of the shares. HK$5 must also be paid on the transfer instrument. There are no specific requirements or restrictions for businesses and non-residents to own or lease real estate (including shares in companies holding real estate).
Foreigners can directly acquire real estate. Non-Hong Kongers are subject to payment of Ad Valorem Stamp Duty (AVD) and Buyer Stamp Duty (BSD). Under the Basic Law, no exchange control policy can be applied in Hong Kong. The contract for the sale of the residential property is subject to stamp duty….