What to Know When Buying a Village House

Important Reminder! Compensatory Premiums are a Necessary Procedure

Village houses are the dream homes for many in Hong Kong. Not only are they surrounded by serene environments, but they are also relatively affordable compared to other types of properties. However, buying a village house is different from purchasing a building in the city, and there are several things to take note of. This article aims to highlight the important factors to consider when purchasing a village house.

First and foremost, buyers must pay special attention to the issue of "compensatory premiums" regarding village houses. Also known as "ding houses," village houses are built by male villagers who possess "ding rights." Therefore, New Territories indigenous villagers who construct village houses are exempt from compensatory premiums. However, if the village house being purchased is a resale property from indigenous villagers or has been resold within five years, compensatory premiums will be required. Therefore, prospective buyers must ensure that the property has already undergone the compensatory premium process to avoid any disputes.

Furthermore, buyers of village houses must be aware of issues regarding land rights. In the New Territories region, different lands have different usage rights, such as agricultural land and fish ponds. Therefore, buyers must confirm whether the land rights of the property being purchased are for residential use to avoid any legal disputes.

Lastly, property maintenance and management are also essential issues for buyers to consider when purchasing a village house. Since village houses are mostly self-built and sold, property maintenance and management are primarily the responsibility of the owners. Therefore, buyers should ensure that the property has established an owners' committee or other management organizations to ensure proper maintenance and management of the property.

In conclusion, while village houses are relatively affordable and surrounded by peaceful environments, buyers must understand the relevant issues and pay attention to the necessary factors. In ensuring compensatory premiums, land rights, and property maintenance, buyers must exercise caution to avoid any unnecessary risks.