LegalTaxMortgageLeaseInvestment

Hong Kong Property Transfer Guide: Key Steps

Yesterday

3 minutes

The blog post has been auto-translated.

Hong Kong Property Transfer Guide: Key Steps post illustrative image

When second-hand transactions involve multiple owners, estate administration, or delegated signing, whether the right of disposal is clear and whether the documents are in place directly affect the ability to deliver a "registrable clean title" on the completion date, and also relate to bank lending and insurance coverage. The following provides a document-first verification framework based on current practices in Hong Kong, and supplements key points on stamp duty for renaming or adding/removing title holders.

Joint tenancy (commonly known as 'long life deed'): Co-owners are considered as one entity; disposal (such as sale or transfer of share) generally requires consent and signatures from all co-owners. Upon the death of one co-owner, their interest automatically passes to the surviving co-owners under the 'right of survivorship'.
Tenancy in common (commonly known as 'divided deed'): Each person owns an interest according to their share proportion; sale of the entire property usually also requires unanimous consent, or the share must be handled legally first.

Q2｜How is stamp duty calculated for "adding names / gifting shares" between close relatives?

Residential property's Buyer's Stamp Duty and Special Stamp Duty have been abolished: Since 2024-02-28, the government has revoked the demand management stamp duties for residential properties; buyers only need to pay the Ad Valorem Stamp Duty (AVD). For residential properties, AVD is uniformly applied at the Second Standard Rate (Scale 2).
Transfers between close relatives still require payment of Ad Valorem Stamp Duty (AVD): Transfers or gifts between parents, spouses, children, brothers, and sisters must still pay AVD based on the consideration or market value (whichever is higher) at Scale 2; do not mistakenly think that "close relatives are completely exempt from tax". If it is a below-market-price transfer or gift, use the market value as the basis.

Q3｜What must be handled before transferring a property with a mortgage?

Bank written consent: Most mortgage deeds stipulate that any addition/removal/transfer of shareholding requires prior bank consent, otherwise it may constitute a breach of contract, or even lead to a demand for early repayment.
May require reassessment: The bank might request a revaluation, review of repayment capacity, and update the mortgagee clause in the fire insurance policy.
Timeline recommendation: 1) First obtain bank consent and conditions; 2) Sign the transfer deed, pay stamp duty; 3) Register at the Land Registry.

Q4｜Can property owned by estates/minors/persons under guardianship or with impaired mental capacity be sold?

Estate Administration: Must obtain a Grant of Probate or Letters of Administration; cases are typically handled and transferred by estate representatives in accordance with the law.
Minor's Share: Disposal involving a minor's interests generally requires approval from the court/regulatory authority and requires a longer time to prepare documents; it is recommended to include "obtaining permission" as a precondition for completion in the sales contract.
Persons with Impaired Mental Capacity (MIP): Usually need to apply for the court to appoint a committee of the estate to handle property matters under the Mental Health Ordinance (Cap.136); the process involves a medical certificate from a qualified doctor.
Authorization for Signing: General powers of attorney become invalid upon the principal's loss of capacity; if it needs to remain effective during incapacity, a Enduring Power of Attorney (EPA) must be used and registered to handle finances and assets.