Hong Kong Life

Where should I live and what will it cost me?

Your most important consideration when choosing a flat will probably be how close it is to your school. The school day usually starts quite early in Hong Kong (often before 8am) and this deters some people from commuting a long distance. That said, Hong Kong's public transport system can take you a long way quickly and cheaply as long as you don't mind the standing-room only crowds during the rush hour. Cars can be purchased very cheaply, but running costs such as petrol, insurance, road tax , paid parking and road tolls can make this quite expensive. However, the cost may be defrayed if you commute from a more pleasant, albeit isolated part of Hong Kong ,(such as the New Territories or South Lantau )where rents can be as low as $4000 per month for roomier lowrise flats . Popular areas for expatriate residents in Hong Kong include the Mid-Levels of Hong Kong Island, Kowloon Tong, Sai Kung in the Eastern New Territories, the Gold Coast near Tuen Mun in the Western New Territories, Discovery Park in Tsuen Wan, Discovery Bay on Lantau Island and parts of Shatin in the New Territories. Many people are attracted to these areas by the prospect of living in the company of other English speakers and of having access to international style shops and restaurants. However, Hong Kong is an increasingly cosmopolitan city and there are now few areas of Hong Kong where it is difficult to find goods and services to suit western tastes. The cost of living in an ex-pat 'enclave' is usually higher than that of living in a more 'local' area. While a traffic free, quiet location like Discovery Bay may appeal to a family with young children, many NETs complain that such areas lack the 'buzz' of the city.
The vast majority of people in Hong Kong live in high-rise flats, and most expatriates coming to work in Hong Kong will find that the accommodation that they can afford to live in while they are here is considerably smaller than what they are used to.

Rental accommodation is expensive, and rents have been increasing very quickly over the past two years as many wealthy mainland Chinese have been speculating in the Hong Kong property market. For a 750 square foot three bedroom flat close to the MTR (underground express rail service) on Hong Kong Island you should expect to pay about $18,000 - $20,000 per month. Prices are considerably less in the New Territories, but the special allowance, currently $12,950, is unlikely to be enough to cover your housing needs unless you are single and prepared to live in a very small flat in a less sought out district. The special allowance is reviewed every two years and is pegged to the government's estimates of average rental prices, but there has been concern that the mechanism which the government uses to calculate the allowance underestimates changes in rents and uses out of date statistics.

Many NETs, especially those who are single, choose to rent serviced hotel apartments during the first few months of their stay in Hong Kong. This can be a good option as hotels across the city offer long-term stay packages and once fringe costs such as electricity and gas bills are thrown into the equation, staying in a hotel is usually not much more expensive than renting. The hotel apartment option also gives you more time to look around for accommodation and find a place to rent that suits you. Because of these advantages, some hotels such as the Royal Plaza Hotel in Mong Kok and the Panda Hotel in Tsuen Wan previously became virtual NET colonies. Recently, however, prices for many serviced apartments and hotels have escalated in line with rental levels generally in Hong Kong.

What's the procedure for renting a flat in Hong Kong?

Rental contracts in Hong Kong are usually for two years. The tenant must usually promise not to break the tenancy for the first twelve months and then during the second year of the tenancy he or she must give the landlord two months’ notice of any plans to move. Currently many landlords are selling their tenanted flats and as the tenancy laws have changed to reflect a more 'landlord friendly' slant, you may find that you have to move flats several times over only a few years. It is worthwhile inspecting prospective flats carefully for defective plumbing, leaks, electrical problems and neighborhood noise before signing a lease, as maintenance can be a fraught issue once you are in residence.

The "start-up" cost of renting a flat is high as the tenant has to pay the first month's rent in advance, pay half a month's commission to an estate agency and pay two month's deposit to the landlord. The deposit is refunded at the end of the contract without interest. Therefore if the monthly rent for an apartment were $12,000, the tenant would have to pay an initial lump sum of $42,000 before moving in.
A salary advance is promised to NETs in their contracts. This is intended to help them with the initial costs of renting a flat. However, occasionally in the past there have been administrative delays in the payment of this advance. To be on the safe side therefore, NETs should bring as much money with them as they anticipate they will need during their first month in Hong Kong.

How expensive is living in Hong Kong?

There is no simple answer to this question because the cost of living Hong Kong is so dependent upon the type of lifestyle that you expect to have while you are here. Many expatriates in Hong Kong dine exclusively at Western restaurants, take up golf, join a yacht club or spend their nights drinking in trendy areas like Lan Kwai Fong and then complain about how much it has all cost them. At the other end of the spectrum, it is certainly possible to buy your food from local markets, eat out at Chinese style cafes and spend very little money indeed (although you might miss out on the fun). For NETWIKS (NETS with kids) and those living in cheaper, more spacious flats further out of town, engaging a domestic helper or maid (currently c.$3,700 + costs per month) can make life much easier for expats working long hours.

Most people will fall between the two extremes. Prices have risen in Hong Kong over recent years, especially in the cost of food, fuel and eating out. Even so, meals in local restaurants are inexpensive compared with eating out in major cities in the west. With the exception of rent and of top-end luxury goods, most goods and services cost much less than they would in Britain and Europe and only slightly more than they would in Australia or North America. The Hong Kong dollar is pegged to the US dollar, and as the US currency has fluctuated dramatically in recent years, so the cost of living has seemed to rise and fall considerably for visitors from overseas.

Be prepared to be asked, very directly, a lot of questions about your lifestyle, finances, holiday plans (for which you may subsequently be asked to seek permission from your Principal to leave Hong Kong) and other queries of a rather personal nature. The NET Special Allowance is one issue which has captured the attention of Hong Kongers. Such issues may not be considered as 'private' as they would in a Western country, but you may not find your colleagues as forthcoming about their own situations. It is probably wisest to keep your responses vague or non-committal in the interests of harmony and discretion.

Where can my kids go to school?

Local schools are not usually an attractive option for NETs because the majority of them teach in Cantonese and because even in English medium schools non-Chinese speaking students are few and far between and are consequently at a disadvantage. The Education Department publishes a list of English medium secondary schools that offer students another language option as an alternative to Chinese (usually French) and that encourage applications from non-Chinese speakers. However, these are almost all elite schools that are heavily over-subscribed, so last minute applications stand little chance of success, the exception being a very small number of state subsidized schools which cater primarily to the South Asian community but which are happy to offer places to students from other backgrounds. As the new senior secondary curriculum which is due to be introduced in 2008 will include Chinese Language as a compulsory subject, it is likely that even fewer non-Chinese speaking children will be able to study at local schools beyond that date.

Most expatriate parents of school age children opt to send them to fee paying independent International schools in the territory or to an English Schools’ Foundation school. The latter are partially subsidized by the government but still charge a fee. ESF and other international secondary schools typically charge fees of between $70,000-$120,000 per year, with places at ESF primary schools costing about $50,000 per year. Another option is to enroll your child in a Direct Subsidy Scheme school as although these schools receive government funding, they enjoy much greater freedom over the syllabus that they offer and the students that they can accept than other schools, and they charge lower fees than independent or ESF schools.

Be aware that the school year in Hong Kong runs from September to July. This may mean that children coming to Hong Kong from the southern hemisphere have to repeat part of the school year.

A less expensive option is distance learning, but this presents the problem of potentially leaving your child socially isolated in Hong Kong if you do not arrange enough compensatory outside activities such as clubs, etc. If your child is between the ages of 6 and 15 then home schooling is strictly speaking illegal although in practice the authorities turn a blind eye. There are an estimated 100+ school age students enrolled in various distance learning programmes, often those offered by Australia or America.

How much will I be paid?
Teachers' salaries in Hong Kong are based on the civil service master pay scale: Master Pay Scale
Teachers start on point 17. A teacher with a post-graduate teaching qualification, B. Ed or equivalent receives two salary points. No additional points are awarded for Masters degrees, PhDs or other higher degrees. Each year of continuous full-time service in a recognised school will qualify you for an additional salary point, but teaching in private tutorial schools does not count and you must be able to provide documentary proof of service. Primary NETs cannot proceed beyond point 30 on the pay scale, and secondary NETs do not proceed beyond point 33.

In addition, NETs employed on expatriate terms receive a special allowance of about $21,000 per month. A NET in his or her second two-year contract without a break in service receives an incentive bonus equivalent to 5% of base salary; a NET in his third or subsequent contract receives an incentive bonus equivalent to 10% of base salary.
Upon satisfactory completion of each contract, NETs receive a gratuity equivalent to 15% of base salary.

What about taxes? How much will I have to pay and when?

Salaries tax is charged in arrears on the income earned during a tax year. The tax year runs from April 1st to March 31st. Usually you will receive a tax return form from the Inland Revenue in May or June directly following the end of your first tax year in Hong Kong. Once you have sent back this return you will usually receive a tax demand a few weeks later but the tax will not usually be payable until a few months later. Tax is payable in two instalments and, in addition to including the full tax payable for the completed tax year, your bill will include a provisional demand for the subsequent tax year. Thus a teacher who arrives in Hong Kong in August 2008 would normally receive his first tax demand in May or June 2009 and would not pay any tax until around January 2010. The top marginal rate of salaries tax in Hong Kong is 17% and the top average rate is 15%. However, the first $108,000 of income is tax-free and the next $105,000 of income is taxed at low marginal rates. There are also generous tax exemptions for dependent children. As a result, only a very small proportion of tax-payers pay the full 15% tax rate.

The special allowance and the gratuity count as taxable income.

Tax Reserve Certificates: These can be accessed online IRD. You organise a direct debit for each month and your tax will be covered and paid when it is due.

What's the MPF and how will it affect me?

In December 2000 the Mandatory Provident Fund regulations came into effect so now all employees in Hong Kong are required to pay 5% of their monthly income up to a maximum of $1,000 into a pension scheme. Their employers also contribute an amount equivalent to 5% of monthly income up to a maximum of $1,000 into this pension scheme. It is not possible to terminate the scheme and draw out the benefits from it until you retire at the age of 60 or permanently leave Hong Kong.

NET teachers who are not Hong Kong permanent residents and who can provide evidence that they are participating in a pension scheme in their home country are entitled to opt for exemption from the Mandatory Provident Fund. If you wish to be exempted from the scheme, you should inform your school office as soon as possible. As expatriate teachers have traditionally been paid a gratuity instead of receiving pension benefits, the Education and Manpower Bureau has decided that employers' contributions to NET teachers' MPFs should be deductible from their gratuities. Therefore, if you participate in the MPF then when you receive your gratuity at the end of two years service you will find that up to $1,000 per month will have been deducted from what you would have originally been entitled to. This money will have been paid into your pension fund and you will only become entitled to it when you leave Hong Kong permanently or when you retire.

My spouse is coming to Hong Kong with me. Can they get a job here too?

Spouses and children are admitted to Hong Kong on a dependent visa. As of 15 May 2006, dependants of people on employment visas are allowed to work in Hong Kong without having to apply for a new visa (see Q5 of the Immigration Department's Visa FAQ's.)
If you wish to claim the passage allowance for your spouse or children, they will have to travel to and from Hong Kong within two months of your arrival and departure.

What can I do with my free time?

Hong Kong provides residents from overseas with a wide range of options to fill their free time, but some of these are expensive.

As Hong Kong is very mountainous and only 20% of the territory is built up, it provides fabulous opportunities for hiking and climbing. When the city is choking in smog it is always possible to get some fresh air by heading for the hills. Hong Kong's country parks have many trails to suit walkers of all levels of ability and also have barbecue pits, picnic areas and free campsites.

There are also many options for those who enjoy water-sports. Many of Hong Kong's beaches, particularly those near the city, are very crowded, but it is possible to find places in the New Territories where you can have miles of sand to yourself. It is also possible to try out windsurfing, canoeing or simply to club together with friends and hire a junk for a day.

Hong Kong has many cinemas that show the latest Hollywood releases and a small number of venues that show 'art-house' films. Cantonese and Mandarin language films are almost always subtitled in English but Japanese films are often only subtitled in Chinese so it's best to check before you buy your tickets.

The Hong Kong government has been striving for some time to improve the standing of the arts in the territory and while the range on offer is by no means comparable with London or New York there are still plenty of opportunities to see opera, ballet and classical music here. Look out for the following events: Fringe Festival (Jan); Arts Festival (Feb/ Mar); Le French May (May); Arts Carnival (July- Aug). Major productions of classical drama in English are less frequent, however, and it is often difficult to get tickets for cultural events unless you plan well in advance.
As for museums, Hong Kong isn't exactly comparable with London or Paris, but the local museums do have fairly frequent travelling exhibitions from major European and American museums and galleries. These can get very crowded and attract long queues. An annual museum pass ($100 for individuals; $200 for a family of four) is well worth getting as the pass includes general admission and all special exhibits, and also lets you avoid queuing for tickets when something big comes to town. Highlights in the permanent exhibits of local museums include the 'Hong Kong Story' at the History Museum and the hands on displays aimed at younger visitors at the Science Museum.

There are several major events in the cultural calendar in Hong Kong including the Hong Kong Rugby Sevens (March), the Salem Tennis Open (April) and the Folk Festival (November). Traditional Chinese festivals such as the Mid-Autumn Festival and Tuen Ng (the Dragon-Boat) Festival also provide opportunities for entertainment.

Eating out is one of the main attractions of the city as a variety of regional and international cuisine is represented by Hong Kong's many thousands of restaurants at prices to suit every budget (though prices have been going up recently). Tsim Sha Tsui, Lan Kwai Fong and Wan Chai also have pubs and night-clubs which stay open until very late. However, it is probably wisest to avoid the infamous go-go bars in the territory as many of these overcharge their customers.

For NETs with kids and those who are young at heart, annual passes to Hong Kong Disneyland (from $650) and Ocean Park (FROM $500) are well worth considering.

What are my leave entitlements like?

Your contract will specify how many days of paid sick leave you will be entitled to; this will depend on the number of years of continuous service at your school that you have given. It is usual for employers to require a doctor's letter when two or more days of sick leave are taken. Some schools require it for a single day. Many schools are particularly strict about sick leave being taken immediately before of after holidays. If you take unpaid discretionary leave immediately before a school holiday, you will lose all the pay and benefits for the holiday period.

Expectant mothers who have been in continuous employment for at least nine months are entitled to ten weeks of maternity leave and must begin taking this leave between two and four weeks before their expected delivery date. There is no statutory paternity leave in Hong Kong.

At the end of each contract you will be entitled to terminal leave: your school cannot require you to perform duties outside of term time during that summer holiday. The EMB also advises schools to arrange mid-contract summer holiday duties for NETs in such a way that they will have at least four continuous weeks of holiday, but unfortunately not all schools follow this advice.

Your school is allowed to grant you up to two days of paid discretionary leave each year to attend to urgent personal business such as a birth or bereavement. Any personal leave above this two-day limit is unpaid and may even affect your entitlement to a pay increment at the end of the year. Obviously, two days' leave may be inadequate for a NET who is flying back to his or her home country in order to attend a funeral and NETs have been lobbying the EMB to be more flexible on this matter. Some school principals are more understanding than others when it comes to granting leave. Some even go as far as advising the NET to take sick leave in such circumstances in order to avoid losing pay. Schools in Hong Kong do not all 'break up' on the same day for holidays and their term dates can vary quite widely from school to school. Ask for the school calendar in English but be aware when booking fares that official school dates can change without much notice.

Can I take on a part-time job in my free time?

The Immigration Department only issues you a work visa for the specific job for which you come to Hong Kong, so if you want to take up part-time work you have to get permission from the immigration department first. You will also have to get permission from your principal and a letter from the part-time employer. Nonetheless, many have taken on duties such as adult education, exam marking and private tuition which have helped to enhance their professional development.