Purchasing Flow
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1.Budget Planning
Set a target and a budget by updating yourself on the market through newspapers, property magazines and property websites.
2.Property Search
Look for a suitable property for yourself through property agencies, newspapers, property magazines or property websites.
3.Property Viewing
View properties of your interest, including the interior conditions and the surroundings, by making appointments with the owners or property agencies via phone calls or emails.
4.Data Analysis
Gather information, such as the transaction records, on your target property and the nearby properties of similar quality through newspapers, property magazines and property websites. Obtain a land search record, including the title registration, the history and other relevant information, of your target property by conducting a land search via www.iris.gov.hk. You can acquire the land search record from your property agent if you have hired one to view the property.
5.Mortgage Valuation
If you need to apply to a bank for a mortgage, you can ask for a free property valuation on your target property so as to get an idea of the maximum mortgage loan amount and a quotation on the interest rates. Our easy-to-use online Mortgage Calculator can help you quickly estimate the monthly mortgage repayments and various expenses with an amortization table for your reference.
6.Price Negotiation
Negotiate the price with the vendor. You may hire a property agent to do the bargaining. Both parties can enter into a Provisional (or Preliminary) Sale and Purchase Agreement when the price and terms are mutually agreed.
7.Payment of Initial Deposit
Upon signing the Provisional Sale and Purchase Agreement, you should pay an initial deposit and appoint an independent solicitor to represent you. The Initial deposit would usually be 3-5% of the purchase price. If you need to apply for a mortgage, a copy of the Provisional Sale and Purchase Agreement should be submitted to the bank.
8.Payment of Further Deposit
The draft formal agreement (Agreement for Sale and Purchase) is normally prepared by the vendor’s solicitor based on the Provisional Sale and Purchase Agreement. The solicitors of each party will explain the terms and conditions contained in the formal agreement to the vendor and you respectively to ensure both parties fully agree to all terms and conditions before signing. Upon signing the formal agreement, you should pay the further deposit either by a bank cashier’s order (bank draft) or a cheque issued by a law firm. Usually the further deposit would be 10-20% of the purchase price, subject to mutual agreement and the duration for the completion of the transaction.
9.Registration of Sale & Purchase Agreement
After signing the formal agreement and paying the further deposit, your solicitor (i.e. the purchaser’s solicitor) should register the agreement at the Land Registry to protect your interests. Normally the formal agreement will be signed after 14 days the Provisional Sale and Purchase Agreement being signed.
10.Conveyancing
To complete the sale and purchase transaction, an assignment should be drafted in order to transfer the title (i.e. property ownership) from the vendor to the purchaser on the completion day.
11.Property Inspection
You can request a final inspection of the property from the vendor a few days before the completion day to make sure the property is in good condition.
12.Transfer of a Property
On the completion day, the vendor will receive the balance of the purchase price and you will be given the keys of the property. Your solicitor (i.e. the purchaser’s solicitor) should immediately stamp the assignment at the Stamp Office and register the assignment at the Land Registry. The transaction of the sale and purchase is now completed.