How to Calculate Saleable Area for Renters in Hong Kong
In the rental process, Saleable Area is a critical metric that determines the actual usable space within a property. However, many renters and landlords are not fully aware of the concept of Saleable Area and how to calculate it. This article provides a detailed explanation of the definition of Saleable Area, the calculation methods, and how to use Saleable Area to choose the most suitable rental property while avoiding "Saleable Area traps."
Definition of Saleable Area
According to the Residential Properties (First-hand Sales) Ordinance, saleable Area refers to the floor area that a residential property independently uses. This includes the property's balcony, utility platform, and veranda. When calculating the floor area of a residential property, unless otherwise specified, measurements should start from the exterior walls enclosing the property and include the areas of partitions and columns within the property.
What Saleable Area Does Not Include
Saleable Area does not include communal areas such as stairs, lift shafts, pipe ducts, lobbies and communal toilets, bay windows, flat roofs, top roofs, stairhoods, cocklofts, gardens, terraces, yards, air-conditioning plant rooms, air-conditioning platforms, planters/flowers boxes and car parking spaces or any other shared facilities.
Why Saleable Area is Important
Saleable Area includes the area occupied by internal walls and columns. If renters only focus on Saleable Area, they might overlook the space taken up by internal walls and columns, leading to renting an unsuitable unit. Moreover, lower floors often have thicker walls, reducing the Carpet Area, which means that the Saleable Area for lower floors is generally smaller than that for higher floors. Therefore, it is advised to inspect the property in person to avoid Saleable Area traps.
How to Calculate Saleable Area
The "floor area" of a residential unit needs to be measured from the exterior of the "perimeter walls" surrounding the unit, including the areas of all internal partitions and columns, but excluding the thickness of decorative materials. Additionally, any walls separating the residential unit from communal areas must also be measured from the exterior of the wall, with its thickness included in the floor area of the residential unit.
When calculating Saleable Area, measurements should start from the exterior of the walls enclosing the property, including the wall thickness, but excluding window sills, air-conditioning rooms, platforms, and balconies. The calculation process is as follows:
- Total Area: Measure from the exterior of the walls enclosing the property, including the areas of internal partitions and columns, and add the floor areas of balconies, utility platforms, and verandas to get the total area.
- Exclude Non-Included Areas: Saleable Area does not include window sills, air-conditioning rooms, platforms, or courtyards.
- Calculate Saleable Area: Sum the areas of all usable rooms to get the Saleable Area.
Saleable Area Calculation Formula
Saleable Area (per square foot/per square meter) = Total area measured from the exterior walls + Floor area of balconies/utility platforms/verandas - Areas not included in Saleable Area
Saleable Area vs. Carpet Area vs. Gross Floor Area
What is Gross Floor Area?
Gross Floor Area includes all the spaces within the property, whether usable or not. This includes the thickness of walls, communal facilities, and a share of some communal spaces.
What is Carpet Area?
Carpet Area refers to the space within the property that can be effectively lived in and used. Unlike Saleable Area, this concept emphasizes the functional use and comfort of the living space.
Comparison of Saleable Area, Gross Floor Area, and Carpet Area
| Metric | Saleable Area | Gross Floor Area | Carpet Area |
| Definition | All actual Carpet Area within the residential unit | Total area including walls, communal areas, and balconies | Carpet space after excluding walls and fixed facilities |
| Calculation Method | Enclosed area minus non-included areas | Internal area plus a proportion of communal areas | Saleable Area minus walls and fixed facilities |
| Example | Floor area including balconies, utility platforms, verandas | All spaces within the building including corridors, elevator shafts, staircases, parking lots, trash rooms | Actual usable space within rooms |
| Usage Scenario | Standard measurement for property sales and rentals | Real estate sales and transactions | Interior design, furniture placement |
| Advantage | Provides a clear reference for actual Carpet Area, reflecting total floor space | Reflects the overall structure and scale of the property | Provides an intuitive understanding of the usable space, fitting practical living needs |
How to Choose a Suitable Rental Property Based on Saleable Area
- Choose Based on Living Needs: Select the appropriate Saleable Area based on your living requirements. If you work from home frequently and need more space for office equipment, a property with a larger Saleable Area would be more suitable. If you are single or only require basic living facilities, a property with a smaller Saleable Area might suffice.
- Analyze Market Trends: Understand the relationship between Saleable Area and rent in the rental market to ensure that the rent you pay is reasonable. Compare the Saleable Area and rent of different properties in the same area to choose the most cost-effective property.
Relationship Between Saleable Area and Rent
Rent and Saleable Area usually have a positive correlation: the larger the Saleable Area, the higher the rent. Therefore, when renting, you should choose the Saleable Area that fits your actual needs and budget. Note that some landlords might exaggerate the Saleable Area, so renters should carefully verify and measure it.
Avoiding Saleable Area Traps
- Identify Common Traps: Besides the area within the house, walls and internal columns can be included in the Saleable Area. Renters can request to see detailed floor plans to ensure they understand the actual use of each space and avoid thick walls or large columns occupying the Saleable Area.
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How to Verify Saleable Area:
- Review Floor Plans: Examine detailed floor plans to verify the purpose and area of each space.
- On-Site Measurement: Measure the area of each room in person to ensure the data is accurate.
- Consult Professionals: If needed, consult real estate agents or surveyors to understand the true Saleable Area of the property.
- Specific Measures: Before signing the lease, ask the landlord to provide the Saleable Area data of the property and clearly mark it in the lease agreement. If the Saleable Area does not match the landlord’s claim, you can raise objections and request reasonable adjustments to the rent or other compensations.
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FAQ About Saleable Area in Hong Kong
Does Public Housing Use Saleable Area for Its Measurement?
No. The area of rental public housing units allocated by the Hong Kong Housing Authority is usually calculated by internal floor area, which is the Carpet Area of the unit, including spaces such as bedrooms, living rooms, kitchens, and bathrooms, but excluding the unit's walls or columns, communal corridors, staircases, and other communal facilities and structures.
Is the HOS Flat Area Measured as Saleable Area?
Yes. The area of HOS flats (Home Ownership Scheme) in Hong Kong usually refers to Saleable Area. The Saleable Area of HOS flats includes all the usable space within the residential unit, as well as the areas of all internal partitions and columns.
Is the Management Fee in Hong Kong Based on Saleable Area?
Yes. In Hong Kong, most residential properties’ management fees are usually calculated based on the Saleable Area ratio. Saleable Area includes all usable spaces within the house, such as bedrooms, living rooms, kitchens, and bathrooms, but excludes communal facilities, wall thickness, etc. The larger the Saleable Area, the higher the management fee.
How Can I Verify the Saleable Area of a Second-Hand Property?
You can check the Saleable Area of a second-hand property through the Integrated Registration Information System of the Land Registry or by asking a real estate agent to provide it.
Is the Bay Window Included in the Saleable Area?
According to the Residential Properties (First-h
