Car ownership: what you need to know about purchasing a vehicle in Hong Kong

car dealer making car ownership a reality

Looking at car ownership in Hong Kong is as simple as it is elsewhere, even with the government discouraging people from buying cars. After a bumper year of car sales in 2016, car registrations from 2017 to 2020 appear to have slowed. Still, there are a few things you should consider if you’re looking to buy a vehicle in Hong Kong. This week, Kwiksure looks at how and where you can buy a car in Hong Kong, as well as some handy tips.

Finding a vehicle to buy

One of the first questions you’ll need to ask yourself before jumping into car ownership is whether you want a new or used vehicle. There are pros and cons to both. A new vehicle will have no wear and tear, next to no kilometres on the clock, and will generally come with a decent warranty that is often backed by the manufacturer itself. Used vehicles will generally beat new ones on price, but may come with damage and without a manufacturer's warranty.

Those wanting a new vehicle can find one from the many car dealerships around Hong Kong. Manufacturers such as Porsche, Volkswagen and Audi have licensed sellers on the island, while companies like The Automall also deal in cars from American and Japanese makers. Many dealers have websites, so you can also view their stock and prices online.

Secondhand dealers are where to start if you’re looking for a cheaper used vehicle. There are used car dealers around Hong Kong, including the DCH Quality Used Car company in Kowloon Bay. You may also find a number of branded dealerships, such as BMW, offer secondhand vehicles. These dealerships may have limited stock immediately available at their car yards, so it may pay to contact them first if you want to test drive a vehicle.

Lastly, online autotrader websites are where you can find a range of deals. Websites such as 28car.com and Car1.hk have a number of classified listings for car ownershipwith a wide range of make and model options.The listings available might be from dealers, but may also be from private individuals looking to sell their own vehicles. Beyond that, you may also find vehicles on other trading and community sites like Asiaxpat and Craigslist.

What do I need in order to buy a car?

Your next step in car ownership is to ensure you are legally allowed to purchase a vehicle. In Hong Kong, there are a few things you will need to hold when owning a vehicle:

  • A Hong Kong ID card
  • A Hong Kong driver’s license
  • A Hong Kong residence to register a new car’s ownership or transfer a used car’s ownership to
  • At a minimum, third party risk insurance

You will also want to be sure you know the costs involved with owning a car. The upfront purchase costs of a vehicle are quite high in Hong Kong; a good condition secondhand luxury vehicle from a European maker can cost HKD 150,000 while a Japanese import can start at around HKD 80,000. This depends on the make and model, of course, but generally expect to pay more than you would in other countries.

There’s also the running and maintenance costs of car ownership. Vehicle licensing fees are charged dependent on the size of your vehicle’s engine. A private car with a 1,500 c.c. or lower petrol engine can pay an annual fee of HKD 3,929, while big 4,500 c.c. engines can be stung with a charge of HKD 11,329 annually. Also keep in mind what fuel prices are and how often you might need to fill up, as well as what annual maintenance costs might be.

Factor into your considerations tolls and parking charges, depending on where you drive frequently and where you will need to park your car when at home.  In 2019, the SCMP found that the world’s most expensive parking space was in Hong Kong, whose sale price was as high as HK$7.6 million. Secure parking spaces are also a must for many insurance purposes, so be sure your parking arrangement is likely to meet your insurer’s requirements too.

Finally, insurance is another necessary cost to factor in. As third party risk insurance is the bare minimum, many people seek out more comprehensive policies that cover damage to both your and a third party’s property. Comprehensive car insurance policies are definitely more expensive than third party plans, so factor these costs into your considerations for car ownership too.

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Car ownership: here are some tips before you make your purchase

If you’re ready and prepared to finally drive a new car home, here are a few tips you’ll want to keep in mind before you hand over your cash for a vehicle:

Take a test drive

Whether you can take a test drive depends on where you buy the car, such as through a car dealership, a car auction, or from a second-hand car seller. If a test drive is an option, always take a potential car for a spin. Test drives allow you to get a feel of how the car handles on the road, how it feels inside the car and to ensure that the car appears to be in working order. Take the opportunity to feel how the gears shift, how the pedals respond, and ensure that the wheel alignment isn’t off before you commit to taking ownership of the car.

Ask for a vehicle history

Vehicle history reports generally hold useful information for potential buyers as to whether or not the car they’re considering has been involved in any traffic or insurance incidents. This can save you from purchasing a vehicle the local law enforcement agencies already have fines attributed to. Contact the Transport Department Licensing Office for more information.

Get a pre-purchase check of the vehicle

Pre-purchase checks could almost be considered essential for those consider car ownership with a used vehicle. The Hong Kong Automobile Association can check a vehicle for you to ensure that it is roadworthy and that you won’t get stuck footing the bill for a repair that wasn’t your fault. If you have your own mechanic, then you can seek them out for a pre-purchase check instead.

New vs used car

There is more to think about, apart from the budget, when you are considering buying a new or used car. Read our “Guide to Buying a Car in Hong Kong, New vs Used infographic” to learn more on the subject.

Getting insurance for your vehicle

The final piece of the puzzle is to ensure you have adequate car insurance coverage for your new car. Car ownership laws in Hong Kong require a bare minimum of third party risk insurance, however such policies only cover damage caused to other people’s property. If you’re involved in a collision, third party plans won’t pay out to repair your vehicle. Comprehensive plans do, however they can be more costly.

Contact Kwiksure for your insurance solutions!

Besides car insurance (third-party and comprehensive), Kwiksure also provides home insurancemotorcycle insuranceVHIS, and more! Use our online quotation system today to receive a free quote! Wish to chat with us for personalized solutions? Contact our team of expert insurance advisors today. They'd be happy to provide you with impartial suggestions to help you choose the perfect insurance plan.

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