How to Set Up a Real Estate Company in Hong Kong

The real estate business in Hong Kong has long been known as one of the most dynamic in Asia, if not the world.

From residential to luxury to retail, Hong Kong has seen almost constantly increasing growth (although prices have leveled off recently). 

Demand, however, is sure to remain constant.

Why Hong Kong is Great for Real Estate

  1. Businesses from all over the world want to set up in Hong Kong, and a recent high-luxury building housing project received 23,000 applications for fewer than 400 units.
  2. Prices are high, making it an ideal place for real estate business—in 2019, the average property price was $2,091 per square foot.
  3. The system is very simple and straightforward, and the financial returns are apparent
  4. Hong Kong is also known historically for providing tax breaks and incentives across many businesses.
  5. Finally, foreigners do well too: if you keep your money in Hong Kong, you pay no net-worth or Social Security-style taxes.

In addition, there is both a lot of capital in Hong Kong and low-interest rates for loans.  

Favorable taxes

Taxes in Hong Kong are some of the most business-friendly in the world, so you’ll be able to enjoy a range of money-saving policies in real estate.

Taxes in Hong Kong (2020):  

  • 8.25% for the first $2 million in profits (Hong Kong Dollar
  • 16.5% on all additional profits
  • You only pay taxes on money made within the borders of Hong Kong (single-tiered system)
  • Personal taxes are low (2% -17%)
  • No sales tax
  • No capital gains tax
  • No withholding tax

So what does it take to get into the real estate business in Hong Kong?

Overview of Real Estate in Hong Kong

First of all, it is essential to know that the state controls all the land in Hong Kong, so there are more government regulations and licenses than one might find in other countries.

That does not mean it’s necessarily more difficult to work in real estate, but you do have to pay close attention to the laws and their evolution. 

If you’re a foreigner, there are actually no restrictions on ownership.

But all investors have to closely follow the rules.

Of course, you’ll be starting your real estate business in a land where rental prices can rival that of the most expensive cities in the world!

There are more than seven million people living in a very small area, so the city has a very high population density. 

A recent report showed that the city has the highest average house price on the planet, at over 1.2 million USD per home.

First Steps To Starting a Real Estate Company in Hong Kong

Hong Kong, like Singapore, is a free economy.

It’s also known for a non-interventionist regulatory stance.

So creating your company is faster and easier than in most other countries.

First, visit and get to know the Companies Registry in Hong Kong.

This government site—most accurately, for the Government of the Hong Kong Special Administrative Region—not only has all you need to get started, but it will also have the latest rules and regulations for businesses.

The first steps will be:

  • Choose a name for your brand new company. One interesting regulation about business names from Hong Kong’s government: “A company may be registered with an English name, a Chinese name, or an English name and a Chinese name. A company name with a combination of English words/letters and Chinese characters is not allowed.”
  •  Show ID, proof of residence, and fill out the application (whether your business has shareholders or is a single owner).
  • Download your Certificate of Incorporation and Business Registration Certificate. You can get these from the website sometimes in just an hour! 
  • Finally, you’ll need to secure any permits or licenses required specifically by real estate.

Real Estate Agency or Solo Practice?

Are you looking to open an agency or work as a solo real estate agent?

Either way, you’ll need to set up a company. 

You must have a Hong Kong estate agent license if you are:

  • The sole owner/employee of a real estate business 
  • A company director or partner in a real estate business 
  • The manager of any real estate agency

As with the real estate industry in most other countries, you are not legally allowed to operate without a license. 

Once again, Hong Kong makes entry easy.

You can find all of the rules, regulations, and the application for a license with the Estate Agents Authority in Hong Kong.

Life in Hong Kong Real Estate

No matter what, you’ll be busy. Demand is high in the Fragrant Harbor and doesn’t look to go down anytime soon.

Salaries for real estate agents vary depending on experience.

A new agent earns an average of over $30,000 USD/year, while agents with over eight years of experience make it closer to an average of $70,000 USD.

There is no doubt that the events of the last year have affected the Hong Kong real estate market, as with the rest of the world.

But with this much demand, the sector is bound to bounce back.

For real estate agents, both veteran and new, Hong Kong will remain a great place to work. 

Registering yourself as a real estate agent now will put you in a position to take advantage!

Registering a real estate company in Hong Kong also gets easier with Air Corporate.

Register your business with Air Corporate today and you’ll get the guidance, tools, and guarantees that will make sure your business starts off on the right foot.

 

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