Hong Kong’s rental market typically heats up in summer, coinciding with the end of the academic year and the expiration of many leases, often leading to relocations. This movement also brings a spike in rental disputes and property-related challenges, which experts say exposes significant gaps in market protocols and ambiguities in rental contracts.

They urge tenants to remain vigilant, especially as the city welcomes a growing number of newcomers through talent attraction initiatives and expanding educational programs. Many are unfamiliar with the market, as well as the legal recourses and regulations available to safeguard their interests.

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In July, Gigi Zheng found herself embroiled in a dispute over her HK$30,000 ($3,840) deposit after ending her one-year tenancy in Sai Wan, Hong Kong Island. Her landlord charged her HK$5,200 for “cleaning, and replacement of curtain, door and door frame, and faucets”, threatening to withhold her deposit if she refused to accept the charges.

Having already left the city, Zheng had few options to challenge the landlord’s claim. She requested authorized proof, and while the landlord provided a company quotation, the amounts did not match the charges.

Zheng argued that the curtain was damaged before she moved in, and complained that her agent failed to clarify that tenants were responsible for the faulty faucet, which was reported days after the lease ended.

With limited recourse, Zheng accepted a partial refund to recover most of her deposit. She said she plans to return to Hong Kong to challenge the deduction at the Small Claims Tribunal, which handles claims up to HK$75,000.

Jesse Shang Hailong, a Hong Kong lawmaker and chairman of the Hong Kong Top Talent Services Association, reported receiving about 20 complaints over the past two months regarding rent deposit refunds, amounts ranging from HK$20,000 to HK$40,000.

In Hong Kong, rental deposits, typically two months’ rent, should be clearly stipulated in the lease agreement.

Difficult to resolve disputes

Shang added that many nonlocal students coming for one-year graduate programs face a narrow window: Their leases and student visas usually both expire in August, leaving limited time to resolve disputes before they depart Hong Kong.

“Most of them are about to leave or have left already, and have no time to contest their losses. Therefore, a conciliatory attitude becomes common,” Shang said.

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Regarding disputes over alleged property damage, like in Zheng’s case, solicitor Li Kai-chi said that landlords are generally responsible for “normal wear and tear”, while tenants should cover “damages”. However, there is no clear distinction between the two.

“As the condition of each property can vary significantly, it is unrealistic to apply the same standard to all,” Li said.

Li suggested tenants review contract terms thoroughly with their agents, understand their rights, and ensure detailed clauses, such as specific definitions of “damage”, ideally with legal assistance.

He also recommends filming or photographing the apartment before moving in. Most importantly, those unfamiliar with local laws should conduct sufficient research before their arrival.

Spike in transactions, prices

In July, Centaline Property reported a surge in both rental transactions and prices, with its market index reaching the highest level since August 2018. The agency attributed the spike to incoming students and professionals, and said it expects the trend to continue.

As of the end of July, 90,000 professionals had arrived in Hong Kong under the Top Talent Pass Scheme, launched in 2022 to attract high-income earners and top university graduates, further bolstering rental demand. The SAR government said last week that 54 percent of program holders have renewed their visas, indicating sustained demand.

Authorities are ramping up efforts to provide information on renting and purchasing properties for new arrivals. Such initiatives have garnered support from the Estate Agents Authority, Hong Kong Talent Engage, the city’s Economic and Trade Offices on the mainland, the Consumer Council, educational institutions, and NGOs.

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Shang suggested that local universities establish a dedicated team to assist students with rental disputes and help refer cases to authorities, adding that the alumni network could lend a hand.

He said the shortage of school dormitories was a fundamental issue, highlighting the practice in which universities buy furnished buildings from developers before renting them to students at affordable prices.

In February, police busted a crime syndicate that conspired with a licensed real estate agent to defraud at least 150 victims, mostly students, out of HK$130 million.

However, Shang said that most disputes do not fall under police jurisdiction, and only a more-targeted support mechanism can effectively address the issues.