7 Steps and Precautions for Buying a Used Car

Picking up used cars?

When choosing a used car, you should pay attention to the car's manufacturing year (i.e., age), number of owners (i.e., number of times it has changed hands), mileage, license plate expiration date, and whether it needs maintenance. Generally, the lower the number, the higher the value.

It's worth noting the number of owners. After initial registration in Hong Kong, the vehicle register will show "0". Each subsequent transfer adds "1", meaning a register showing "4" indicates the vehicle has had 5 owners. As for mileage, Hong Kong vehicles typically travel approximately 10,000-15,000 kilometers per year. You should also try to purchase officially imported vehicles with original factory maintenance records. If necessary, you can call the manufacturer to check the mileage. Regarding grey market vehicles, you need to verify whether the vehicle has actually been imported. If there are no relevant import documents and detailed information, it's advisable not to buy it.

Where to buy a used car?

To buy a cheap used car, of course, you have to shop around. You can make an appointment to see the car through an online platform, a used car dealer or a used car dealership.

Used car online platform

• 28car.com
• 28car offers a large selection of used cars, allowing buyers to filter their desired vehicles by model, manufacturer, year, transmission, and price. All listings display the last update date, letting potential buyers know if the listing is still "active."
• Cars
• Formerly known as Beyondcars, it provides car buying, selling, and maintenance services. The platform offers official certification to verify the quality of some vehicles, providing buyers with greater assurance.
• Buycar
• The homepage displays mainstream car brands and price ranges, allowing users to directly find their preferred used cars. It also provides information on charging stations and parking lots, and offers a car registration service. Simply enter your desired vehicle details, and the website will automatically search major Hong Kong used car websites daily, notifying potential buyers immediately when a suitable car is found.
• Facebook Marketplace
• Individuals and car dealerships can both list and request vehicles on this platform, making transactions more flexible. First, select vehicles from the categories in the Marketplace, then filter by listing date, price, condition, etc., to find your ideal vehicle. However, buyers must carefully verify the seller's identity.
• Carousell
• Prospective buyers can search by car model, price, and age. If they are interested in parallel imports, they can refer to the seller's transaction reviews to understand the seller's sales record, and can also contact the seller and make an offer within Carousell.
• Price.com.hk
• Integrates prices from multiple car dealerships, making it easier for car owners to compare prices.

Used car dealers

• Dah Chong Hong Approved Used Cars
• They have a showroom in Kowloon Bay, housing over 600 used cars for comparison; they also conduct pre-sale inspections on the cars for sale and provide a 6-month warranty, offering quality certification and after-sales support.
• Dealers such as BMW
• While they do sell used cars, only a limited number may be available for viewing in the showroom. If you plan to test drive one, it's best to contact them beforehand and schedule a time.

Used car dealership

• It is recommended to choose a well-known used car dealership, as they usually offer maintenance and after-sales services.
• Car listings on dealerships may contain the same or similar listings as those on online platforms, potentially allowing dealership brokers to pose as private sellers.
• Some used car dealerships may tamper with the odometer readings of older vehicles (a practice known as "adjusting the odometer"), "faking" the mileage, or concealing fault records. Be vigilant.

When you have selected your favorite car listing, you can contact the seller to make an appointment to see the car and test drive in person.

Car viewing precautions

When viewing a vehicle, the body and paint will generally be observed for signs of damage and maintenance to assess whether the vehicle has been severely impacted and for defects that are unacceptable to the prospective owner. Prospective owners can pay special attention to whether the side doors of the vehicle have been replaced, whether there is a significant difference in body color, whether the front and rear covers have been repainted, and the newness of the interior of the cabin.

Test drive precautions

The most important thing about test driving is to know how comfortable it is to drive. Therefore, you should first test how easy it is to get in and out of the car, the comfort of the car seats and rear seats, how easy it is to handle the steering wheel, and whether the car pedals are adjustable. If you find that it is not suitable, you should not buy it.

If the driving experience is comfortable, prospective car owners can test the car's basic operations, such as the braking system, window and door operation, electronic turn signals, and whether the steering is working properly.

Buyers can also politely discuss the possibility of a test drive with the seller and agree on the test drive distance and route. The following items can be tested during the test drive:

• Acceleration: Is the car's shifting downshifting smooth? Does it have enough horsepower to accelerate uphill? Pay attention to any engine jerking.
• Engine and road noise: How does the car sound when accelerating? Pay attention to whether the engine sound is mixed with any noises or abnormal sounds, which may be due to wear on the brake pads, steering wheel, or wheels.
• Braking: How does the brake pedal feel when braking fully? Does the brake pedal feel sluggish or unstable?
• Handling: Can you sense the road conditions through the steering wheel? When you turn 90 degrees, do you feel resistance or a pulling force? Try turning the lane carefully a few times and see how the car performs at high speeds.
• Suspension: Is it too tight or too loose? Does the car feel comfortable when driving on bumpy roads?
• Blind spots: Modern cars have larger pillars inside the vehicle to increase safety, but this can also create more blind spots. Check your rearview mirror and rear window to identify blind spots.
• Lights: Ensure that the brake lights and turn signals are functioning properly.

If any abnormalities are found during the test drive, it may indicate a problem with a vehicle component. In such cases, you should inquire with the seller. The transaction should not proceed until the problem is resolved to avoid incurring losses.

Negotiation process and suggestions

Bargaining is quite common in the buying and selling of used cars. Sellers may also raise the price slightly when listing their cars, hoping that buyers will bargain and they can sell at their desired price.

Buyers can politely inquire about the price negotiation based on the test drive experience. However, they should do their homework beforehand and check the market prices of similar vehicles to avoid being overly aggressive in their negotiations. If they want to offer a larger price reduction, they need to demonstrate sufficient sincerity, such as proposing immediate deposit and signing of a sales contract, hoping to impress the seller with conditions that allow them to complete the transaction as quickly as possible.

Further Reading:[Test Drive Guide] Precautions for Test Driving New/Used Cars

After agreeing on a price with the seller, regardless of the car's price, it is recommended to contact a professional vehicle inspection. This is to ensure that all vehicle components are functioning properly and that the vehicle has not experienced serious collisions or water immersion. Before the inspection, the buyer can pay a small "earnest money" deposit, and only place a full deposit after the inspection results are satisfactory. If the vehicle is in good condition, the inspection process can usually be completed within half a day.

Two main ways to inspect a vehicle

• Arrange for a vehicle inspection company to come to your location for inspection.
• Some of the more well-known vehicle inspection companies in Hong Kong includeHong Kong Vehicle Inspection (HKMI) and International Professional Vehicle Inspection Center (IPMC). The vehicle inspection technician will provide a written report and offer a neutral opinion. The fee is generally around HK$1,300, with the technician's parking fee charged separately.

• Head to the garage for vehicle inspection (commonly known as "putting the car on the shelf").
• Most garages offer "listed" vehicle inspection services, with a list price ranging from $700 to $1,000, depending on the model and country of origin. Japanese cars are generally cheaper than European cars. Similarly, after the inspection, the mechanic will provide basic information such as whether the car has been in a major accident or what parts have been repaired.

If an inspection reveals that the desired vehicle has been in a serious accident that affects driving safety, the buyer should terminate the transaction. If the vehicle problem involves the replacement of a large number of parts, the price of the vehicle and the cost of the replacement parts should be weighed to assess whether further negotiation or termination of the transaction is necessary.

Request the seller to provide the vehicle registration certificate and maintenance records.

Before confirming the transaction, the prospective buyer can request the seller to provide the vehicle registration certificate and complete maintenance records to know the first registration date, information on previous owners, and the validity period of the vehicle's license plates, as well as records of the vehicle's regular maintenance, repairs, and parts replacements. If you have doubts about the authenticity of the license plate, you can discuss with the seller about authorizing a paid ‘Certificate of Vehicle Registration Details’ to verify the identity of the vehicle owner's license plate."

If the used car is in good condition after inspection, you can negotiate the final price with the seller and pay a deposit. To sign a provisional car sale and purchase agreement, the new car owner should carefully review the contract terms to ensure that the contract clearly specifies the car price, detailed vehicle information, deposit amount, delivery date, and the responsibilities of both the buyer and seller. It should also state that the vehicle has no outstanding loans and is not registered with any car associations. Before the vehicle transfer, it is essential to ensure that any fines from the previous owner have been fully paid; otherwise, the new owner will be responsible for paying the fines.

In addition to provisional sales and purchase agreements, new car owners can apply to the Licensing Office free of charge to view the relevant vehicle information before purchasing the car. A Certificate of no outstanding fines and no violation records can also be issued to confirm that the vehicle has no outstanding fines or license plate suspensions. The certificate is valid for 72 hours after it is issued.

Before the formal transfer of ownership, buyers should remember to ask the seller for vehicle registration documents, and a copy of the "insurance book" is required so that the insurance company can provide a quote and issue a temporary policy (Cover Note). Then, you can bring the temporary insurance policy and arrange to meet the seller at the Transport Department to complete the transfer procedures.

Hong Kong law requires car owners to purchase at least third-party liability insurance (commonly known as third-party liability insurance). Kwiksure can provide you with instant car insurance quotes and car insurance price comparison.

Also note that if you are under 25 years old or only hold a temporary driving license (P-plate), you are considered a higher risk by insurance companies. Therefore, your insurance premiums may be more expensive. Additionally, depending on the specific insurance plan, you may need to pay different upfront fees before making a claim (i.e., prepayment). Therefore, it is recommended to carefully read the details of the insurance policy terms.

Car owners need to prepare the following documents to ensure their vehicles:

• Vehicle registration document copy
• All registered drivers' identification documents (Hong Kong ID card or passport)
• All registered drivers' driver's licenses
• Supporting documentation for no-claim discount (if applicable)

Documents required for vehicle transfer

Within 72 hours of the official transfer of the vehicle, both the buyer and seller must personally bring the following documents to the Licensing Office under the Government Transport Department to complete the formalities.

• Complete and sign the vehicle transfer notice (Transport Department Form TD25), along with a $1,000 transfer fee
• The new vehicle owner must submit the original notification letter to the Transport Department, while the copy must be submitted by the old vehicle owner.
• Original vehicle registration documents (license plate book)
• Identification documents of both the buyer and seller (original Hong Kong identity card or passport).
• Car insurance certificate (temporary policy)
• Proof of address for the new car owner (issued within the last 3 months)

There are four licensing offices in Hong Kong, which are open from 9 a.m. to 5 p.m. (including lunch break) from Monday to Friday, and closed on Saturdays, Sundays and public holidays.

Vehicle transfer fee

Schedule an appointment to complete vehicle transfer procedures

As all four licensing offices are extremely busy, on-the-spot transfer procedures may require queuing for several hours or more. It is recommended that both parties consider booking the service online to shorten waiting and queuing times. Currently, a free appointment can be made for the next ten weeks.

Buying and selling a used car is usually a cash-on-delivery transaction. Buyers are advised to...Before the transfer of ownership, carefully check the vehicle chassis number one last time, inspect the condition of the body and mechanical parts, ensure that the interior functions are working properly (water deflector, turn signals, etc.), and check that all accessories are present (wheels, horns, etc.).Only after confirming there are no issues should the remaining balance be paid in cash or by check. If using a bank transfer, it is also recommended to perform the above checks before the transfer. After completion, the vehicle should be locked (the buyer should keep the keys), and the buyer and seller should go to the Transport Department together to complete the transfer of ownership.

What kinds of used cars should you not buy?

The most important factor when buying a car is the driver's comfort. If the experience of getting in and out of the car, riding in the car, and driving the car is not ideal, even if the used car is in excellent condition, it should not be purchased. In addition, if the used car has experienced a serious collision or flooding, or has problems that affect driving safety, or if an inspection reveals that the vehicle has problems requiring the replacement of a large number of parts, the transaction should be stopped.

Do both the old and new owners need to go to the vehicle registration office to transfer ownership when buying a used car?

The law does not require both the old and new vehicle owners to be present for the vehicle transfer, and the parties or their agents can submit the relevant documents to the Licensing Office in person. However, since the vehicle transfer procedure requires on-site verification of information and ensuring that the information is complete, it is recommended that both the old and new vehicle owners go together in person to correct any information and supplement any missing documents in a timely manner, so that the transfer procedure can be completed smoothly.

What documents are needed for transferring ownership of a used car?

Both the buyer and seller must personally submit the following documents to the Licensing Office within 72 hours of the formal transfer of ownership: the buyer must provide a vehicle transfer notice (Transport Department Form TD25The original vehicle registration document (license plate), identity document, vehicle insurance certificate (temporary policy), and proof of address are required; the seller must submit a copy of the vehicle transfer notice, vehicle registration document, and identity document.

How long does it take from buying a used car to taking delivery?

The transaction timeline depends on the progress of negotiations between both parties. Once the agreement is reached, a time can be scheduled for a test drive and vehicle inspection. If the vehicle is in good condition, the final price can be negotiated, a provisional sales contract can be signed, and a deposit can be made. The seller can then provide a copy of the vehicle registration certificate for the buyer to purchase car insurance. After obtaining a temporary insurance policy, you can go to the Licensing Office within 72 hours to complete the vehicle transfer procedures, pay the balance, and take delivery of the vehicle. If the negotiations go smoothly, the vehicle is in good condition, and the documents are complete, it can be completed in as few as a few days.

Do I need to pay taxes when buying a used car in Hong Kong?

When buying a used car in Hong Kong, you usually do not need to pay the initial registration tax, except for buying an imported used car, which needs to be registered with the Transport Department and obtain a license plate.