🏠 A Beginner's Guide to the Property Market: How to Know If You're Ready to Buy a Home

The editor’s personal experience + actual data will help you step by step check whether you are “ready” to get on board!

The Hong Kong property market has long been known as one of the most challenging in the world for homeownership. High prices create a burdensome mortgage repayments, yet many find true stability in having a roof over their heads. So, the question is: Are you truly ready to buy a home?

Many friends ask me, "I have a small amount of savings. Is it enough to buy a house?" or "If my income isn't very stable, should I still consider buying a property?" In reality, determining whether you're ready isn't just about whether the bank will approve your application. You need to consider your finances, your psychology, your lifestyle, and your future plans. Below is a comprehensive guide I've compiled to help you check it out.

1️⃣ Financial Basics: Money is the first step💰

Perhaps the biggest challenge in buying a property is money. To determine if you're ready, consider the following:

Initial funding

• Hong Kong banks generally require a 10%-20% down payment from first-time buyers (depending on the property price and mortgage plan).
• For example, for a 6 million unit on the first floor, you need to prepare a down payment of at least 600,000 to 1.2 million.
• Stamp duty, legal fees, agency commissions, and miscellaneous expenses must also be added, and cash flow must be more sufficient.

👉 Editor's advice: Don't just plan for just enough ; it's best to have an additional "emergency fund" that can cover at least 6 to 12 months of mortgage payments.

Housing pressure

• When banks approve mortgages, they perform a "stress test" to ensure that the repayments do not exceed 50-60% of your income.
• But I think you have to prepare for the worst: if the interest rate is raised by 2-3%, can you still handle it?

Income stability

• Be especially careful if your job changes frequently or your income fluctuates greatly, such as if you are a freelancer.
• The bank will look at your income proof when approving your application. It will be more difficult to get approved if you don’t have a stable salary slip.

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2️⃣ Life planning: Don’t just focus on the present 🗓️

Buying a property isn’t as simple as just being able to afford it today; future plans also need to be considered.

Family factors

• Will you get married in a few years?
• Do you plan to have children?
• Will your family live with you?

These factors will affect the size, location and school network of the unit you need.

Work Location

• Do you want to return to Central, Kwun Tong or other areas for a long time?
• If your workplace has inconvenient transportation and you have to commute to work every day, your quality of life will be greatly reduced.

👉 Editor's experience: A friend of mine bought a Tuen Mun unit because he was greedy for the price, but he works in Hong Kong Island and has to commute for 3 hours every day. He regretted it terribly after half a year.

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3️⃣ Mental preparation: psychological endurance 🧘

Accept the risk

• Property prices will not rise forever, and if you enter the market you must accept the possibility of price drops.
• From an investment perspective, you should be prepared to "hold for the long term" and don't expect to make money by short-term speculation.

quality of life

• Some people have to reduce their quality of life to the minimum in order to buy a house.
• The editor reminds you: buying a house is to improve your life, not to sacrifice your life.

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4️⃣ Understanding the property market: Do enough research 📚

Property market trends

• It is important to understand that house prices are closely related to interest rates, and interest rate hike cycles usually suppress house prices.
• Check the Rating and Valuation Department website to get real transaction data instead of listening to the real estate agents' "speculated prices".

Policy impact

• Government measures (such as stamp duty and stress testing) are subject to change at any time, directly affecting your ability to buy a home.
• If you are an investor, you should pay more attention to additional stamp duty and policies for non-local buyers.

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5️⃣ Real case sharing👤

I have a classmate named Ken. At 30, he earned a salary of $40,000 and painstakingly saved up $800,000 for a down payment. Desperate to buy a home, he bought a second-hand flat for $7 million, borrowing 90% of the mortgage. Initially, he was able to afford it, but a year later, interest rates rose, pushing his monthly payments from a little over $20,000 to nearly $30,000. Furthermore, the building's maintenance fund collapsed, forcing him to pay tens of thousands more. As a result, he struggled to make ends meet each month, his quality of life plummeted, and he eventually had to move back home with his parents.

👉 This example reminds everyone: having a down payment does not mean you are ready to buy a house . It also depends on your ability to pay the mortgage, your future life, and your psychological endurance.

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6️⃣ Editor’s Summary✨

To determine whether you are ready to buy a home, you can use the following checklist:

• Have enough down payment + additional emergency fund✅
• Stable income, pass your own stress test✅
• Have a clear life plan (marriage, family, work location) ✅
• Be mentally prepared to accept fluctuations in the property market✅
• Have a basic understanding of real estate market data and policies✅

If you've met all of the above criteria, congratulations! You're ready to buy a home! But if you're still struggling, don't rush. Start saving money, observe the market, and improve your skills. It's never too late to jump in when the time is right.

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🙋 Editor's note:
Buying a home is a major life event, so don't rush into it out of fear of missing out. Rather than forcing yourself into a home and becoming a "house slave," wait until you're truly ready. Buy with peace of mind and enjoyment.

🏠 Property Market Checklist: Are you ready to buy a home?

The editor has compiled a detailed checklist. Just tick the items one by one ☑️ and you will know whether you are really ready to get on the car!

1️⃣ Financial Basics💰

☑️ I have enough down payment (at least 10%-20% of the property price)
☑️ I have an extra emergency fund (at least enough to cover 6-12 months of contributions)
☑️ My contribution ratio is less than 50% of my income
☑️ I have done a "stress test" and I can withstand a 2-3% interest rate hike. ☑️ I have a stable income and I have clear proof of income.

2️⃣ Life Planning🗓️

☑️ I have considered my plans for marriage/children/family in the next few years. ☑️ I know the size and location of the unit I need. ☑️ I have considered my commute to work, which is convenient and time-saving. ☑️ I will not seriously affect my quality of life because of buying a property.

3️⃣ Prepare your mind 🧘

☑️ I accept that property prices may fall and won't panic due to short-term fluctuations ☑️ I don't buy properties just to follow the trend; I know what I want ☑️ I'm willing to make long-term mortgage payments and won't expect to make a profit from short-term speculation

4️⃣ Real estate market knowledge📚

☑️ I check transaction records, not just listen to real estate agents’ bargaining. ☑️ I understand how interest rates, supply, and policies affect property prices. ☑️ I understand the government’s aggressive policies (stamp duty, stress test, etc.)
☑️ I know I am suitable for buying new properties or second-hand properties

5️⃣ Real case reminder👤

☑️ I know that “having a down payment does not mean you are ready”, and it also depends on your ability to pay the mortgage and your mental endurance. ☑️ I will not ignore the cost of living (management fees, maintenance funds, renovation costs) just because I am eager to buy a house.
☑️ I don’t just look at “affordability on the surface”, but plan my income and expenses comprehensively

6️⃣ Final check✨

☑️ Wealthy → Enough down payment + emergency fund ☑️ Powerful → Stable income + Reasonable mortgage payment ratio ☑️ Planned → Clear life plan + Suitable location ☑️ Mentally sound → Accepts risks + Unafraid of fluctuations ☑️ Knowledgeable → Familiar with real estate market data + policies

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🙋Editor's suggestion :
If you can tick most of the boxes, you're likely ready to buy a home! But if you still have a lot of unchecked boxes, don't rush. Keep saving and strengthening your financial foundation until you're truly ready. Then, you can enjoy a secure and stable home.