Purchasing a Car and Minimising Car Ownership Fees in Hong Kong

Buying a car in Hong Kong, in all honesty, is not a necessity. According to an article published on SCMP.com, the public transport system in this region is so great that it diminishes the need to own a car. Any place in Hong Kong can be reached by the MTR. The ferry, bus system, and other modes of public transport make travel around the area very easy.


Of course, that does not mean you should go without a car if you can afford it – and if it will make your life more convenient. But it is not really your finances that is the issue here. It is your financial behaviour that you need to keep in check when you have plans to buy a car in Hong Kong. More often than not, this will only serve as a status symbol for you. It will set you apart from the other hard-working residents in the region – but that does not mean you should go about the car buying process irresponsibly.


You have to remember that a car, no matter how much it makes you life convenient, is a depreciating purchase. The moment you drive it off from the car dealer, the value is already lower than what you initially got. This is the main reason why you need to take calculated steps as you embark on this financial transaction.

Car ownership fees in Hong Kong

4 steps to buy a car in Hong Kong

To be smart when buying a car in Hong Kong, you need to take these 4 practical and important steps.


Step 1: Decide if you can afford it.

Start by thinking about your finances. While we mentioned that the money is not really an issue with you, this is still an important consideration – especially when you have plans to borrow a car loan to finance this purchase. Be honest about how much you can afford. Take careful note of the other expenses that you need to deal with like your housing, food, and utility costs. If you do not own your house yet, you cannot afford to be extravagant with your car purchase. When deciding the amount that you can spend on the car, do not focus on the purchase price. You have to think about the other costs that you need to spend on as a new car owner. You need to pay for the registration and license of your car. And ou also have to think about your parking and repair/maintenance expenses. And what about the fuel? You need to factor in these costs before you finalize how much you can really afford.


Step 2: Choose the car you want to buy.

This is the exciting part of the car buying process. Try to hold back on your emotions so you can think clearly. As much as you want to get the most impressive looking car, think about how you will use it. Ideally, you want to get a car that is fuel-efficient. This will help you save a lot of money on car expenses. You should also consider buying a used car instead of a new one – but you have to weigh the pros and cons in terms of the maintenance costs. When buying a used car, you can buy from private individuals who advertise on-line or in the newspaper – but make sure you know something about the mechanics of the car. You want to make sure you will buy a vehicle that is in good condition despite being a second-hand car.


Step 3: Find the funds to pay for the car.

The third step is the one that will make you cringe but it is the part that will seal the deal for your car. You need to find the funding to help you buy the car. Since this is a depreciating cost, you want to put down as much cash as you can. However, that is often times not possible. You have two options when it comes to getting a car loan. The first is through a bank. You can get a personal loan or a secured car loan. The second option is through the in-house financing of the car dealer. This usually has a higher interest rate and you should make sure you understand the terms and conditions before you proceed with the loan.


Step 4: Get an insurance coverage.

The final step is getting an insurance coverage. You may think this is unnecessary when buying a car in Hong Kong – but it is not. In fact, it is mandatory. You need to get a motor insurance before you can drive off with your car. The Motor Vehicles Insurance (Third Party Risks) Ordinance states that it is compulsory for all car owners to in Hong Kong to secure a motor insurance with an authorised insurance company. Choose the insurance that fits your driving style and how you intend to use the car.


How to minimize the cost of car ownership

Once you have your car, it is important for you to consider the costs that you need to spend on as a car owner. Based on the infographic published on Money Hero in 2014, here are the different costs that you will encounter if you have a 2014 Ford Fiesta


  • Fuel costs: HK$6,165.90 (annual consumption of a fuel efficient car)
  • Maintenance costs: HK$2,780 (dealership rate)
  • Toll fees: HK$40 to HK$110 (Cross Harbour Tunnel HK$20 and Western Harbour Crossing HK$55)
  • Parking fees: HK$744.72 to HK$3,300 (monthly rate)
  • Insurance premiums: HK$6,000 (annual)
  • Registration costs: between HK$83 (license plate) to HK$149,900 (first registration tax)
  • Vehicle license fee: HK$530 (Annual vehicle examination fee) and HK$3,929 (Annual vehicle license fee)


As you can see, it adds up to be quite an expense. If you want to save on these costs, here are some tips that you can follow:


  • Opt for a car with a smaller engine – since it will consume less fuel. If paired with a fuel efficient car, you can save a lot on your gas consumption.
  • Be careful of your driving. There are certain driving habits that will make your car consume more fuel. For instance, you should drive slower to consume less gas. And you should also be careful of how you step on the break because it could lower your maintenance costs.
  • Plan your errands. If you have to go somewhere with your car, make sure that you will combine trips to save on both time and gas. If you have to pay the toll, you should make sure that your destination will help you accomplish more than one errand.


Buying a car in Hong Kong should make you consider all of these things so you will not spend more than you have to on the vehicle.

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