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SQESalespersons Qualifying Examination✓EAQEEstate Agents Qualifying ExaminationMr Lau signs a preliminary agreement for sale and purchase for a new flat on Monday and pays the 5% preliminary deposit. He then changes his mind and does not sign the agreement for sale and purchase. What happens under Cap. 621?
Answer: The preliminary agreement terminates after 5 working days, the 5% is forfeited, and the owner has no further claim. Why not the others: - 3 working days and 10%: That was the pre-2013 Consent Scheme practice, replaced by Cap. 621. - Sued for the full price: The statute limits the owner's remedy to forfeiting the deposit. - A refund on notice: The deposit is forfeited, not refunded. Rule: A purchaser who signs a preliminary agreement pays a 5% preliminary deposit; if he does not sign the agreement for sale and purchase within 5 working days, the preliminary agreement terminates, the deposit is forfeited and the owner has no further claim. If he does sign, the owner must sign within 8 working days after the preliminary agreement. Source: Residential Properties (First-hand Sales) Ordinance (Cap. 621), sections 52 and 53; as at Oct 2026
Using the pre-2013 3-working-day and 10% figures.
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Start practising →An original question written to the published EAQE syllabus. Figures in the explanation carry their effective dates; check them against the current law before relying on them. Independent exam practice. Not affiliated with or endorsed by the Estate Agents Authority (EAA) or the examination administrator.