Frequently Asked Questions and Answers
Prospective purchasers of first-hand residential properties should pay attention to the following issues before signing a PASP and/or ASP:
- Ensure that the mandatory provisions as required by the Residential Properties (First-hand Sales) Ordinance (the Ordinance) are incorporated into the PASP and/or ASP.
- Ensure that information on the fittings, finishes and appliances of the residential property being purchased are set out in the PASP and/or ASP.
- Pay attention to the area plan annexed to the ASP which shows the total area to be sold to the prospective purchaser. The total area is normally greater than the saleable area of the property.
- A preliminary deposit of 5% of the purchase price is payable by the prospective purchaser to the vendor upon entering into a PASP.
- If the prospective purchaser does not execute the ASP within 5 working days (working day means a day that is not a general holiday or a Saturday or a black rainstorm warning day or gale warning day) after entering into the PASP, the PASP is terminated, the preliminary deposit (i.e. 5% of the purchase price) is forfeited, and the vendor does not have any further claim against the prospective purchaser for not executing the ASP.
- If the purchaser executes the ASP within 5 working days after the signing of the PASP, the vendor must execute the ASP within 8 working days after entering into the PASP.
- The amount paid by the purchaser to the vendor, including the preliminary deposit, should be made payable to the solicitors’ firm responsible for stakeholding purchasers’ payments for the property.
Purchaser must be careful before entering into PASP. If purchaser does not execute ASP within 5 working days after entering into PASP, the PASP is terminated and the preliminary deposit (i.e. 5% of the purchase price) forfeited.
PASP and/or ASP can include provisions other than mandatory ones required by the Ordinance. But mandatory provisions shall prevail where there is conflict between mandatory and other provisions.
Prospective purchasers should read carefully the documents containing information on sales arrangements of a residential development made available by the vendor and pay attention to any requirement to sign PASP/ASP in person. If in doubt, prospective purchasers should make enquiries with the vendor and consider consulting professionals for advice.