GENERAL INFORMATION ABOUT HONG KONG
Hong Kong is situated on the southeast coast of China at the mouth of the Pearl River facing the South China Sea. Covering an area of 1,104 square kilometers (425 square miles), the territory is made up of Hong Kong Island, the Kowloon Peninsula and the New Territories. At the core is Victoria Harbour, which separates Hong Kong Island from Kowloon and beyond that, the New Territories that runs up to the boundary with Mainland China. As well as making up the bulk of Hong Kong's land mass, the New Territories also incorporates 262 outlying islands, including Lantau where the airport is located.
The Hong Kong Special Administrative Region has adapted many of the British laws passed down from their rule and HKSAR came into being after the Handover in 1997. It continues to be a capitalist society with legislative and judicial laws separated from those of the People's Republic of China.
Hong Kong is considered an inalienable part of the People's Republic of China, meaning that it serves as a separate independent region. Fundamental rights and freedoms are also safeguarded for the residents of Hong Kong in accordance to Article 31 of the Constitution from the People's Republic of China. Along with other members of legislature, the chief executive of Hong Kong is appointed by citizens of Hong Kong every five years. As agreed by the Chinese government of an unchanged society of 50 years, Hong Kong runs under the law of one country, two systems. Currently the Chief Executive of Hong Kong is Mr. Donald Tsang Yam-Kuen.
TYPES OF ACCOMODATION APARTMENTS
The “typical” Hong Kong apartment will be on one level with a combined living-dining room, kitchen, maid’s room and toilet, utility/laundry area, two/three/four bedrooms and one/two/three bathrooms. Some have balconies (usually the older blocks) and others on the top floor may have exclusive use of the flat roof area above. Separate dining rooms are rare.
Properties built in the last ten years are equipped with modern, fitted kitchens and bathrooms, while many older units have been renovated, some to quite modern standard. A few “luxury” premises offer high standard kitchens and bathrooms at matching “luxury” prices. Appliances are sometimes, but not always, provided.
Modern developments also often provide communal recreational facilities which may include any or all of swimming pool(s), tennis, squash, clubhouse and gymnasium, billiards, badminton and playground.
Air conditioning is essential in Hong Kong and while the better buildings are equipped with central or individual systems, it is sometimes necessary to install your own and this should be checked while viewing properties
Duplex or Townhouses
Townhouses are usually built in developments of from around seven to 20 or 30 houses. Due to land space restrictions, these are often on four or five levels, sometimes with a small private garden and/or a usable flat roof.
They vary greatly in size from around 2,000 sq.ft. to over 5,000 sq.ft. The larger ones usually have a separate dining or family room or study, with three or four bedrooms and bathrooms.
A number of developments share communal pool facilities, and the larger or more expensive ones may also have tennis, squash courts or a clubhouse.
A private detached house and garden is a real luxury in Hong Kong and there are only a very few available at the top end of the market or in outlying areas.
Most accommodation is leased out in good condition with walls and ceilings all repainted, parquet flooring (common to most properties) and minor repairs made to fixtures and fittings.
Depending on the age of the property and the rental, kitchens can be fully equipped with cooker, refrigerator, dishwasher, washing and drying machine.
Most Larger Flats are offered unfurnished as middle to upper management executives relocate to Hong Kong with contains of personal effects whereas the smaller units catering to a single expat lower to middle management may come fully funiished and turn key. There is a wide choice of household furnishings and fittings available in Hong Kong or Qi-Homes also offers an interior design service.
In Hong Kong, the majority of expatriate households and very many local families employ domestic help.
Hong Kong is a very social community and the pace of life is very fast. Quite a lot of entertaining takes place in the home and can be on the formal side. Most homes are built with servant’s quarters which, these days, usually comprise one small room and bathroom. The older buildings provide larger rooms, often two, as family custom used to be for one maid (amah) for each family member, plus cook, cleaning and laundry amahs. These days, most families content themselves with one domestic helper, although some executives employ two, or even a couple where the husband may be the cook or driver or attend to any gardening or outside work.
The servants’ rooms are often surprisingly small, but are generally quite acceptable to the domestic helpers who spend most of their time in the living quarters anyway, and who may have been used to a lot less.
When employing domestic helpers other than Hong Kong Chinese, strict Immigration procedures apply and it is necessary to arrange a formal contract which is provided by and registered with the Immigration Department. These are for a standard two years and the salary scale is fixed by legislation.
LEASE TERMS IN HONG KONG
The typical rental lease in Hong Kong is 24 calendar months with a break clause after the 12th Month. This binds both the tenant and landlord for the first 12 months thereafter either party can give 1 or 2 months notice to vacate without penalty. If neither party exercises the break clause the rental price is protected for the 24 calendar months which maybe good considering rents can rise quite quickly. Traditionally the right to exercise the break clause may only be done by the Tenant and is still very much the case for larger properties or corporate tenancies. However recently the right to break can be exercised by both parties particularly for smaller or individual leases.
FEES, GOVERNMENT CHARGES AND UTILITIES
The tenant will need to be prepared to pay a number of costs applicable to finding a home in Hong Kong, and these are detailed below. Most are payable in advance or quite quickly after choosing where you will live. As a rule of thumb, it is recommended that you arrange to have funds available in advance in Hong Kong for this purpose equivalent to at least four times your budgeted monthly rental, preferably five or even six.
These fees, provide for communal services such as security guards, cleaning and maintenance of common areas and amenities. The amount varies according to the age and number of units in a building and the type of amenities or quality of services provided. These charges are payable monthly usually but not always by the landlord – Be sure to ask.
RATES AND GOVERNMENT RENT
Rates are a form of property tax on leased accommodation, assessed by and payable to Government at 5% of the approximate annual rental value. In addition, properties in some districts (part of the New Territories and outlying islands) are subject to Government land rent, which is calculated at 3% of the rateable value. These charges are payable quarterly in advance usually but not always by the landlord – Be sure to ask.
These are usually equivalent to two, occasionally three, months’ rental and are payable to the Landlord when an offer to lease is accepted. They are mostly refundable in full should the Tenancy Agreement not be signed. Once the Tenancy Agreement is signed, the deposit is held by the landlord without interest, and refunded to the tenant upon expiration of the lease. The cost of any damage or reinstatement work necessary to the apartment, other than fair wear and tear, will be deducted from the deposit before repayment.
The Tenancy Agreement is usually provided by the landlord or his solicitor (lawyer) with an initial draft for the tenant’s approval. The tenant may use a solicitor to review the lease at his discretion. Each party is responsible for their own legal fees.
GOVERNMENT STAMP DUTY
A form of Government tax payable on all Tenancy Agreements and usually payable by the tenant and landlord in equal shares. The total amount payable on a two-year lease is 0.5% of the annual rent plus $5, or 0.25% of the annual rent plus $5 for a one-year lease (uncommon except for serviced apartments).
An introductory fee of half of one month’s rental is payable by the tenant. In accordance with local practice, the agent may also accept a fee from a third party such as the landlord or landlord’s agent. Package details available to corporations on request.
Except for serviced apartments, it is the tenant’s obligation pay utilities such as gas, electricity and telephone/fax lines. A deposit or connection fee is payable to each provider, roughly equivalent to two months’ estimated usage, refundable on termination of the service. Qi-Homes assists all clients with the setting up of Utiltities Accounts as part of our service.
RENTAL PRICES AND TIMING
Rentals are in Hong Kong dollars, payable monthly in advance, and, except for serviced apartments, the rental price may or may not be inclusive of monthly management fees, Government rent and Government rates, for which an additional 12% to 15% of the rent should be budgeted.
PRICING OF PROPERTY IN HONG KONG
Pricing of property varies according to location, views, facilities and size. Please see where to live (hyperlink)
Private landlords are open to negotiations on rental price based on factors such as start time of the tenancy, duration, quality of tenant and any additional repairs or furnishings to be included. Expect about 5% maximum reduction on the asking price if you are able to start the lease in 30 days or less with minimimal requests.
Some larger properties in Hong Kong are retained by developers who manage and rent out to corporate accounts. There is usually little to no room to negotiate the rental price and many require 3 months deposit with a company lease or copy of the tenants employment contract.
The legal tender is the Hong Kong dollar (HK$), which is linked to the US dollar at a rate of about 7.80 HKD to 1 USD, although exchange rates may fluctuate slightly. Interestingly, Hong Kong banknotes are issued by three banks (HSBC, Standard Chartered Bank and Bank of China), and vary in design and colour for each denomination.
Coins (issued by the government)