Cushman & Wakefield, on the other hand, predicts drops of up to 20%. These include the right to land contractual management, the right to use of construction land, the right to use of residential housing land and easement. [1] Landlords paid taxes to the government in return for land-owning rights (known as subsoil rights), but did not have the right to actively use the land. Compensation for non-land rural assets is also highly discretionary. Since Hong Kong Special Administrative Region (HKSAR a.k.a Hong Kong) retained separate legal system from the People’s Republic of China (PRC a.k.a Mainland China) but sovereignty falls into a part of Mainland China, the entitlement of Hong Kong permanent residency in Hong Kong immigration law has certain points of correlations with Nationality Law of PRC. Search for real estate and find the latest listings of Hong Kong Property for sale. [3]:354–355[4] :17 Under Nationalist rule, the private sector owned most forests. The total rate for the Initial Deposit and Further Deposit is 10% of the total price. Currently, the types of compensation are: However, the first two are paid to the collective landowners instead of the farmers. It is not difficult for a … Also, there’s a cap set to HKD 4,000,000. Hong Kong can be a good option if you have a decent amount of cash and look for a safe place to invest long-term. However, at least it’s something. By minimising the business interests in the expropriation procedure, incidents of forced expropriation might be reduced.[33]. – 20% as allowance for maintenance, + HKD 96,000 * 15% = HKD 14,400 Finding realtors online is the most common practice nowadays, at least among Western buyers. Hong Kong has grown from a small trading hub to become one of the top three financial centers in the world. The government even plans to build an artificial island to counter the problem, a project that will cost as much as USD 80 billion. Obviously, the average resident cannot buy a property 100% in cash. Even if Hong Kong is one of the most multicultural financial hubs in Asia, it’s sometimes difficult to find residential real estate agents in Hong Kong. Real property rights in China can generally be grouped into three types. [17] As a protection of the right, the term of the right shall be automatically renewed upon expiration[18] If it has to be taken back, compensation shall be given. The real estate market has been hit hard in Hong Kong during the COVID-19 pandemic. [23] This is to ensure obligations are met. The landlords in turn collents who used the land for agricultural purposes (topsoil rights). The stamp duties totals of 30%, which speaks for itself. Since all land is owned either collectively or by the state,[32] expropriation of rural land only requires the withdrawal of land use rights for the reason of "public interest. However, some of the methods used to do so aren’t cost effective. I’ve been in contact with Midland and asked what the conditions are for foreigners who wish to apply for a local property loan, who aren’t Hong Kong residents. According to HSBC, non-resident foreigners can get mortgages of up to 50% of the total property value if you reside in the property. There are no import taxes or VAT for that matter, a reason why many people buy electronics and other products when visiting Hong Kong. How difficult is the property purchase process in Hong Kong? Hong Kong is well-known for having some of the lowest income and corporate taxes in the world. I’ve personally been in touch with some banks to confirm if it’s even possible to get a local property loan as a non-resident foreigner. [19], The owner of the right to use of residential housing land can possess and utilize such land as collectively owned, and can build residential houses and their accessory facilities. Abu Dhabi and Hong Kong were the next most expensive areas for renters, both with average monthly rental costs of more than $2,700. The first deposit is called ”the Initial deposit” and usually 5% of the purchase price. [48], Another issue is the problem of rampant corruption arising from rural land transactions, involving both governmental and non-governmental parties. Truth be told, I’m even surprised that you can apply for a property loan as a non-resident foreigner. There are two kinds of property titles: Use Rights - lease rights to the property. The rate is currently set to 15% and deducted from your rental income. [21], The owner of easement has the right to use the real property of others to benefit his own real property. [4]:60, In the areas controlled by Communist forces traditional land tenure was broken up through Land Reform. Customers who are looking to finance a property overseas can apply for a mortgage in the following countries and regions: Australia, Canada, mainland China, France, Hong Kong SAR, India, Malaysia, New Zealand, Singapore, UAE, the UK and the US. Hong Kong’s property market is well-known for being transparent with an efficient title-recording system. If you do want to buy property in Hong Kong, be prepared to spend some time to get familiar with important factors such as investing in old or new buildings, the area to chose, legalities, mortgage plans, interest rates and other government formalities. They can own more than 49% in a Thai-company, thanks to the ‘Treaty of Amity and Economic Relations between Thailand and the US’, signed in 1966. It was handed back to China in 1997. In this way, he could avoid paying taxes worth around USD 17,000,000. This register is proof of ownership. But that is not the end of the story, in Hong Kong the government set up a few legislations to make investing in property harder and harder. To make the leasing process as smooth as possible, I recommend you to let your real estate agent handle the tenant screening and the management of tenants. [38], The Land Administrative Law provides five situations under which land use rights may be withdrawn:[39], The rights holder is entitled to "appropriate compensation" in the first two situations. A land user obtains only the land use right, not the land or any resources in or below the land. Find Property for sale in Hong Kong. [5]:8, Until decollectivization in the mid-1980s, there were only two factors making for change in land policies: the level of collective ownership and the extent of freedom in private land use. [11] There are several types of usufructuary rights. There’s a reason why it has one of the world’s most expensive and most overvalued real estate markets. The description below applies to the post-reform legal arrangements and should not be confused with nationalisation of property before 1978. The tenancy agreement will show the rights and restrictions your tenant has when leasing your property. You need to live in Hong Kong for at least 7 years to become a permanent resident. [4]:67 Newly accrued land along rivers, creeks and other waters – so-called riparian rights – was clearly designated as state property, and the Qing government repeatedly emphasized this in imperial edicts. Friday China links. ", The definition of public interest is intentionally vague, and a general list of such interests has been expounded in an attempt to define what it means.[33][34]. Other analysts believe that we will see a decline of 5% in 2020 and with larger price falls during 2021. [26] Regardless of the method by which the land use rights is granted, a contract for grant of land use right, or more commonly known as a land grant contract, must be entered into by the land user and the local land administration authority or municipal governments at or above the county level as grantor.[27]. However, you need to include information, such as: Be sure to print three copies of the estate agency agreement and the formal tenancy agreement: One for you, one for the tenant, and one for the real estate agent. If you’re from Singapore, you can see that the process is similar as buyers first pay a fee of 1% for a so-called Option to Purchase (OP). The right to land contractual management allows a contractor of the right to possess, utilize and obtain profits from agricultural land. Fill in the form to get connected with a real estate agent in Vietnam, Malaysia, Thailand or other countries. Getting money out of China Via Hong Kong in 2021. The issue by going for this option is that foreigners cannot own more than 49% of a limited company in Thailand, except for US-citizens. This is common in Asian countries and regions, including mainland China, Indonesia, Vietnam, Cambodia, and Thailand. He is currently a freelance consultant supporting Asiaimportal (HK) Limited with content creation and research. The outlook for China's Land Administrative law is hopeful as future revisions regarding rural land are expected to occur in the near future. I generally include information about buying processes in my guides, Hong Kong is not an exception. However, different interests might be registered under different registries. If you plan to buy real estate in Hong Kong, then it might be the right time. These privileges were rescinded twice (and subsequently reinstalled) during the Great Leap Forward and the Great Proletarian Cultural Revolution (1966–76). This might seem low considering the high costs when buying real estate in Hong Kong. Technology is catching up in the real estate market for sure. Before you engage in Hong Kong’s property market, it’s important that you learn about the market, the buying process, prices, property taxes, and more. Cushman & Wakefield, on the other hand, believes that prices might drop as much as 20%. Each case is treated individually and you need to keep your records for at least 7 years after the completion of the sale. + A provisional amount of the following year = HKD 14,400, The total property tax to be paid = HKD 14,400 x 2 = HKD 28,800. The BSD is applicable to foreigners, but not to permanent residents (HKPR). You read about them pretty often in newspapers like South China Morning Post (SCMP). Save my name, email, and website in this browser for the next time I comment. [10] The obligee may not intervene in the exercise of rights by the owner of the usufructuary right. In the 1930s Land Reform in the old revolutionary base areas, such as the Jiangxi Soviet and the Shaan-Gan-Ning Border Region, was carried out with the least possible social disruption. [51] However, in 2011, the Chinese Government released regulations clarifying this, which promise to provide more transparency and a fairer compensation system. In case you need financing, there are plenty of banks that are willing to help you. Even if prices reach record high levels, Hong Kong continues to be an attractive spot for overseas investors. However, there are some limitations to foreign ownership, for example, to the ownership of land. The mortgage market is highly developed by Asian standards and mortgage loans account for 25% to 30% of all the bank loans. Some of the information that should be included in the PA is: You can visit EAA’s website to review a complete list of all the items that the PA should include. As of 2019, Hong Kong had by far the highest average residential property price in the world as you can see below (in USD): Rents were also among the highest in the world, averaging at USD 2,700 and only behind New York where rents averaged at USD 2,844. When you sign the Sales and Purchase Agreement (SPA), you need to pay the Further Deposit. Downpayments differ depending on various factors such as your residential status and if you bought a house previously. The market has been hit badly during the COVID-19 pandemic and we’ve seen large-scale layoffs in industries like aviation and banking. Learn how Asian countries compare on foreign property ownership rules, taxes, visa options, capital controls and more. The country may, as necessitated by public interest, expropriate or requisition citizens' private property and pay compensation therefor." , he was considered a “ first-time homebuyer ” and usually 5 % of chargeable... 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