Welcome to Hong Kong, a global city where East meets West. Its vibrant culture, thriving business landscape, efficient transport, low tax rates, and safe neighbourhoods make it a top destination for expatriates and property investors alike. For foreign investors, Hong Kong’s appeal is amplified by its open property market—there are virtually no restrictions on foreigners owning property—and favourable tax policies, including the absence of capital gains tax and inheritance tax.

While the market is known for being one of the world’s most expensive, the property acquisition process is remarkably straightforward. As a leading real estate agency, Midland Realty has crafted this comprehensive guide to empower you with the knowledge to navigate your purchase with confidence.

Quick Facts for Expat Buyers

• Can Foreigners Buy? Yes, expatriates can freely buy residential property in Hong Kong with almost no restrictions.
• Extra Taxes for Foreigners? No. As of February 2024, the extra taxes for foreign buyers (Buyer’s Stamp Duty – BSD) have been completely abolished. All buyers now pay the same standard stamp duty.
• Typical Down Payment: You should budget for a minimum down payment of 30% of the purchase price, as the maximum loan-to-value (LTV) ratio is generally 70%.
• 90% Mortgages: Mortgages with a 90% LTV are typically only available to Hong Kong Identity Card (HKID) holders through the Mortgage Insurance Programme.
• Physical Presence Required: You must be physically present in Hong Kong to sign the final mortgage documents with the bank.
• Key Agreements: The process involves two main contracts: the Provisional Agreement for Sale and Purchase (PASP) and the Formal Agreement for Sale and Purchase (ASP).
• Standard Agency Fee: The standard commission for an estate agent is 1% of the final purchase price, payable by both the buyer and the seller.

1. Research and Preparation: Laying the Groundwork

Define Your Needs and Budget
Before diving in, clearly outline your requirements. Consider the property type (apartment, townhouse), desired location (e.g., the convenient Mid-Levels, the serene Southside, or the more affordable New Territories), size, and amenities. Understanding your budget is paramount.

Conduct Market Analysis
Analyse property prices and market trends in your preferred districts. Online platforms like 28Hse are excellent starting points for your research.

Seek Professional Advice
The most crucial step is to assemble your team of experts. This includes a licensed estate agent, a solicitor (lawyer), and a mortgage specialist.

Expert Tip from Midland Realty:
Partnering with an experienced estate agent who understands the unique needs of expatriates is a game-changer. A great agent not only provides access to exclusive listings but also acts as your trusted advisor, ensuring your interests are protected throughout the entire journey.

2. Property Search and Selection: Finding “The One”

Viewing and Comparing Properties
Once your Midland agent has curated a shortlist, it’s time for on-site visits. Evaluate the property’s condition, location, and proximity to essentials like MTR stations, schools, and supermarkets.

Expert Tips from Midland Realty:

• Get a Mortgage Pre-Approval: Before making an offer, consider getting a mortgage pre-approval from a bank. This gives you a clear picture of your borrowing capacity and provides peace of mind.
• Beware of Stigmatised Properties: Be aware that properties with a history of unnatural death (so-called ‘haunted houses’) may face challenges in securing a mortgage from some banks. Your agent can help you identify and avoid such properties.

3. Negotiation and Offer: Sealing the Deal

Making a Formal Offer
When you’ve found your ideal home, your agent will help you formulate a strategic offer and negotiate with the seller (vendor) on your behalf. The written offer will outline the proposed price, deposit amounts, and the target completion date.

Expert Tip from Midland Realty:
Knowledge is power. Before negotiating, your agent will provide you with data on recent transactions and bank valuations for similar properties. This empowers you to make a reasonable and compelling offer.

4. Signing the Provisional Agreement: The First Commitment

Once your offer is accepted, you will sign a Provisional Agreement for Sale and Purchase (PASP). This is a legally binding contract.

• Land Search: Before signing, your agent and solicitor will conduct an updated land search to verify critical details like the property’s legal owner, address, and any existing mortgages or government orders.
• Initial Deposit: Upon signing the PASP, you will pay an initial deposit, typically 3-5% of the purchase price. Be aware that backing out after this stage usually results in the forfeiture of this deposit.

5. Legal Due Diligence: The Solicitor’s Role

You must hire a solicitor to handle the legal aspects of the transaction. Their role is to:

• Review the formal contract prepared by the vendor’s solicitor.
• Conduct thorough due diligence, including scrutinising the title deeds to ensure the seller has the right to sell the property.
• Provide legal counsel and ensure a “clean” and legal transfer of ownership.

Expert Tip from Midland Realty:
Choose a reputable solicitor firm that has a working relationship with your chosen mortgage bank. This can significantly streamline communication and prevent delays.

6. Financing: Securing Your Mortgage

Foreigners can readily apply for mortgages in Hong Kong.

• Application: You can submit your mortgage application with the signed PASP directly to several banks like HSBC, Bank of China, and Standard Chartered to compare offers. However, a highly efficient alternative is to engage a reputable mortgage broker, such as mReferral (經絡按揭). A broker can handle the application process with multiple banks for you, provide a clear comparison of interest rates and terms, and offer expert advice—all typically at no cost to you, as they are compensated by the banks. This can save significant time and help you find the best possible deal.
• Loan-to-Value (LTV) Ratio: The maximum LTV ratio is generally 70% for all residential properties, meaning you’ll need a down payment of at least 30%.
• Required Documents: Foreigners typically need to provide a valid passport, the PASP, and proof of income (such as tax returns, bank statements for the last 3-6 months, and an employment contract).
• Debt Servicing Ratio (DSR): Your monthly mortgage payments should not exceed 50% of your monthly income.

Important Note: You must be physically in Hong Kong to sign the final mortgage documents.

7. Signing the Formal Agreement: Finalising the Contract

Within 14 days of signing the PASP, you will sign the formal Agreement for Sale and Purchase (ASP) at your solicitor’s office.

• Further Deposit: At this stage, you will pay the remainder of the down payment, bringing the total deposit to 10% of the purchase price.
• Stamp Duty Payment: You must also pay the Ad Valorem Stamp Duty (AVD).

Recent Update on Stamp Duty (as of Feb 2024 & Feb 2025):
Great news for international buyers! The Hong Kong government has cancelled all demand-side management measures. This means the Buyer’s Stamp Duty (BSD) and Special Stamp Duty (SSD) are no longer required. All buyers, regardless of residency status, now pay the same standard AVD rates. Furthermore, to ease the burden on buyers of lower-valued properties, the maximum value for a property to be charged the minimum stamp duty of HK$100 was raised from $3 million to $4 million, effective from February 26, 2025.

8. Property Transfer: The Completion Day

On the agreed-upon completion day:

1. Final Inspection: Conduct a final walkthrough of the property to ensure its condition is as agreed.
2. Pay the Balance: Your solicitor will coordinate with your mortgage bank to draw down the loan and pay the remaining balance to the vendor’s solicitor.
3. Get the Keys: The property is officially transferred to your name via a document called an assignment, which is registered at the Land Registry. Upon completion, you will receive the keys to your new home!

9. Post-Purchase and Moving In

Your journey doesn’t end with the keys. Remember to:

• Settle Final Payments: Pay your solicitor’s fees and the estate agent’s commission.
• Arrange Insurance: Secure comprehensive property insurance.
• Register for Utilities: Set up your accounts for water, electricity, and gas.
• Maintain the Property: Establish a routine for maintenance and ensure timely payment of property management fees, government rates, and rent.

Frequently Asked Questions (FAQ) for Expat Buyers

Q: As an expat, what’s the first step to buying property in Hong Kong?
A: The best first step is to conduct initial research on locations and prices, clearly define your budget, and then engage a professional estate agent. An agent from Midland Realty can provide expert advice tailored to your needs, helping you navigate the market efficiently from day one.

Q: What is the minimum down payment for a foreigner buying property in Hong Kong?
A: As a foreigner, you should plan for a minimum down payment of 30% of the property’s purchase price. This is because the Hong Kong Monetary Authority (HKMA) guidelines set the maximum loan-to-value (LTV) ratio at 70% for most buyers. You will also need to budget for additional costs like stamp duty, legal fees, and agent commission.

Q: Do I have to pay extra taxes like Buyer’s Stamp Duty (BSD) as a foreigner in 2025?
A: No. The Hong Kong Government abolished the Buyer’s Stamp Duty (BSD) and other “spicy measures” in February 2024. This is a significant advantage for expat buyers, as you now pay the same standard stamp duty rates as local permanent residents.

Q: Is it possible for an expat without a Hong Kong ID to get a 90% mortgage?
A: Generally, no. The 90% mortgage is made possible by the Mortgage Insurance Programme (MIP), which is typically only available to Hong Kong Identity Card (HKID) holders purchasing a property for self-occupancy. Most expatriate buyers should expect a maximum loan of 70% of the property value.

Q: What documents are required for a mortgage application in Hong Kong with overseas income?
A: You will need a valid passport, the signed Provisional Agreement for Sale and Purchase (PASP), and comprehensive proof of income. For overseas income, this usually includes your latest tax demand note, salary slips for the last 3-6 months, and complete bank statements for the last 3-6 months showing salary credits. Self-employed individuals will need business registration documents and audited financial statements.

Q: What is the difference between the Provisional Agreement (PASP) and the Formal Agreement (ASP)?
A: The PASP is the first legally binding contract you sign after your offer is accepted. It outlines the basic terms and is accompanied by an initial deposit of 3-5%. The ASP is a more detailed contract prepared by solicitors, which you sign within 14 days of the PASP. It supersedes the PASP, and at this point, you top up your deposit to a total of 10% of the purchase price.

Q: What are the consequences if I withdraw from the sale after signing the Provisional Agreement for Sale and Purchase (PASP)?
A: If you back out of the deal after signing the PASP, you will forfeit the initial deposit you paid to the vendor. Furthermore, you may still be liable to pay the agreed-upon commission to the estate agents as stipulated in the agreement.

Buying a property in Hong Kong is a significant and rewarding investment. By following these steps and partnering with the experts at Midland Realty, you can navigate the process with clarity and confidence.

Ready to start your property journey in Hong Kong? Contact a Midland Realty expat specialist today!