Essential Fraud Prevention Tips for Buying Second-Hand Properties

Buying property in Hong Kong is a major financial commitment, often representing a lifetime of savings. In the second-hand market, some transactions have fallen through due to hidden liabilities, causing buyers to forfeit their deposits. So how can purchasers safeguard themselves against such risk?

In a recent article of the CHOICE Magazine published by the Consumer Council (CC) with inputs from the LR, six key advices on purchasing second-hand properties were provided as follows:

• Consult a solicitor before signing a provisional sale and purchase agreement (provisional agreement) to protect own interest. Any additional terms to be incorporated into the formal sale and purchase agreement is subject to the mutual consent of transacting parties.
• Conduct a land search to verify the registered owner's identity and clarify any doubts before signing a provisional agreement.
• Require stakeholding deposits until the completion date.
• Include in the provisional agreement a right to rescind the transaction if hidden incumbrances are discovered.
• Set the completion date at least one month after signing the provisional agreement for identifying any incumbrances that may take priority over the buyer’s interest before the transaction is completed.
• Understand the role of estate agents and seek solicitor’s advice to safeguard one's interests.

For details, please refer to the article (Chinese version only) in Issue No. 583 of CHOICE Magazine in CC’s website.