A friend recently shared that they had applied for the latest round of the White Form Secondary Market Scheme. After receiving a letter from the Housing Authority requesting the submission of a detailed income and asset declaration form, they realised that they did not actually know much about the scheme. What exactly is the White Form Secondary Market Scheme? What procedures should applicants pay attention to after applying?
The White Form Secondary Market Scheme, in full, mainly allows eligible White Form applicants to purchase flats in the Home Ownership Scheme Secondary Market or other designated subsidised sale flats without paying a land premium. Unlike first-hand HOS flats, the selling price of flats purchased under the White Form Secondary Market Scheme is set by the owner, and buyers must negotiate the price directly with the owner.
Once an applicant is successful in the ballot and receives notification from the Housing Authority, they must submit a detailed income and asset declaration form within the specified period. The applicant and the family members listed on the form must truthfully declare all income and assets, including salary income, bank deposits, stocks, funds, the cash value of insurance policies, properties and other assets, for the Housing Authority to assess their eligibility.
After the Housing Authority verifies the applicant’s eligibility, the applicant will be issued an approval letter and two confirmation letters. The two confirmation letters apply respectively to Housing Authority HOS Secondary Market flats and Housing Society Flat-for-Sale Scheme Secondary Market flats.
It is worth noting that receiving an approval letter does not mean that the applicant can immediately purchase a flat. The holder of the approval letter must submit the relevant confirmation letter to the Housing Authority and/or the Housing Society within six weeks from the date of issue of the approval letter to apply for a Certificate of Eligibility to Purchase (CEP. Applicants must hold a valid CEP they can purchase an eligible flat in the relevant secondary market.
In terms of fees, each CEP costs HK$900. When applying, the applicant must mail a copy of the approval letter, the original completed confirmation letter, and a crossed cheque or cashier’s order to the relevant department. Generally, after the relevant organisation receives the required documents, it will issue the Certificate of Eligibility to Purchase by registered mail within around 14 working days.
Each CEP is valid for one year and cannot be extended after expiry. Prospective buyers must therefore allow sufficient time to search for a flat, negotiate the price and sign a provisional agreement for sale and purchase within the validity period. If they fail to complete the relevant procedures within the validity period, they will lose the opportunity to purchase a flat under the White Form Secondary Market Scheme.
After receiving the CEP, prospective buyers may search for second-hand flats offered for sale without payment of a land premium in the HOS Secondary Market. The available choices are not limited to second-hand HOS flats of the Housing Authority or Housing Society, but also include eligible Green Form Subsidised Home Ownership Scheme flats and public housing units under the Tenants Purchase Scheme. After finding a suitable flat, the buyer may sign a provisional agreement for sale and purchase with the owner.
However, transactions under the White Form Secondary Market Scheme differ from ordinary private residential property transactions. After signing the provisional agreement, the buyer must apply to the Housing Authority or Housing Society for a nomination letter. Only after the nomination letter has been issued may the buyer and seller sign the formal agreement for sale and purchase and the deed of assignment. Therefore, to avoid affecting the transaction, buyers should allow sufficient time for the nomination letter application when setting the date for signing the formal agreement for sale and purchase. It is generally recommended to allow around 12 to 14 days between the provisional agreement and the formal agreement.
