HKG To Let or To Buy

[airamerica]

For those in the know can you give us the gen on pros and cons for either,or the best way to go about reargding accomodation whilst making the most of housing allowances,tax breaks.

[ACMS]

If you want to buy a decent 3 bedroom place for a family my guess is that it would cost around 10 to 12 million ( HKD ) If you fixed your CX rate at $52,000 odd a month you would hardly pay more than interest on the loan and would rely on Capital growth alone to make any money over time?

Did you say "tax breaks"???????????? in Hong Kong??????????? haven't heard of that one.

cheers

[betaboy]

We just bought a 3 bedroom flat for 5.5 mil HKD. A whopping 1030 sq ft (930 net) but the place is clean and modern. There are cheaper, larger places in South Lantau and in other areas of HK. Flats in Central can cost you twice as much or more. Either way, all pretty affordable on the housing assistance, which now stands at $56,000 per month, assumed a fixed payment for the length of the mortage, for a maximum of 15 years.

There is a tax break for first time home buyers. I believe the interest is tax deductible for a certain period of time (1 or 2 years?). I'm sure the HK govt web site (Inland Revenue Department) would have more info.

You can afford a bigger place if you rent, and you won't have to pay govt rates (property taxes) and management fees.

If you buy, you have to come up with a down payment. You also have to pay stamp duty (a lump sum property tax) of about 3%. If your down payment is less than 30% of the property value, you need to pay about 4% towards mortgage insurance premiums. Also, your housing assistance is considered to be in addition to your income and taxed at your income rate (about 15%). I figure that, all told, if you sell your house after 10 years for what you paid for it, you'll end up keeping about 70% of the Cx assistance over that time, after paying for all the taxes, fees, and incidentals.

[ACMS]

mmmmmmmm seems I gave wrong info?

I know quite a few that bought in Mid levels and Db that are selling their renovated apartments for 10 to 11 million HKD. They say anything decent is 10 to 11 million now? maybe south Lantau in the sticks and way out in Sai Kung may be 5 to 6 million?

1 KA guy just bought a place in Sai Kung for 10 million.

If they are 10 million I don't think the Cx allowance of $56,000 month would do the job?

I stand to be corrected as always.

[niceneasy]

Just something to consider to obtain more space for less..... The ex and I bought a 55ft Bondway boat two and a half years and were berthed in the DB Marina Club. We had approx 2,000 ft of luxury living and great lifestyle. We originally purchased for about 2.8m and sold for reasonably more two years later. Berthing fees are high and you need a debenture which isnt cheap (around $120,000 frrom memory) however you on sell it later when you leave. Worth a look but need to mention that the prices of the livaboards have gone up substantially due to the supply and demand thing. There are other marinas HK side if the DB thing doesnt thrill you. Additionally, a crowd called Mandarin make nice boats too. Just google both and you will find the links. Sizes range from 35 - 75 ft I think and berthing fees increase acording to the size of the boat. DB Marina are adding additional berths due to demand. All the best.