The Letter of Reservation serves as a crucial intermediate document in Hong Kong property transactions, particularly in new developments or pre-sale scenarios. It is commonly used when a potential buyer wishes to secure their interest in a property before proceeding with a full sale and purchase agreement. The document typically includes essential details such as the property specifications, reservation fee amount, reservation period, and conditions for converting the reservation into a sale. While not as binding as a formal sale and purchase agreement, the Letter of Reservation provides both parties with certain rights and obligations during the reservation period. This document type is particularly relevant in Hong Kong's dynamic property market, where buyers often need time to arrange financing or conduct due diligence while ensuring the property remains available to them.
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1. Date and Parties: Date of the letter and full details of both the potential purchaser and the seller/developer
2. Property Details: Specific description of the property being reserved, including address, unit number, size, and any identifying features
3. Reservation Fee: Amount of the reservation fee, payment terms, and whether it's refundable or will be applied to the purchase price
4. Reservation Period: Duration for which the property will be reserved and key dates/deadlines
5. Terms of Reservation: Core conditions of the reservation including exclusivity and what happens at the end of the reservation period
6. Acknowledgments: Statements confirming understanding of the non-binding nature for final sale and other key terms
1. Special Conditions: Additional terms specific to the property or transaction, used when there are unique circumstances or requirements
2. Property Viewing Details: Information about property viewing arrangements, included when the property is still under construction or has limited viewing availability
3. Development Schedule: Include for off-plan properties to outline expected completion and key milestone dates
4. Agent Details: Required when the reservation is being handled through a property agent
5. Cancellation Rights: Detailed cancellation terms and procedures, included when specific cancellation provisions are negotiated
1. Property Details Schedule: Detailed specification of the property including floor plans, fixtures, and fittings
2. Payment Schedule: Breakdown of the reservation fee payment terms and future payment milestones
3. Property Photos/Plans: Visual documentation of the property or architectural plans for off-plan properties
4. Due Diligence Documents: List of documents to be provided during the reservation period for buyer's review
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