When I spoke to you last time in email, I explained why we burried the "village House " idea, and went for a top floor apartment that included a 500FT2 roof top. Our property is 16 years old, in the process of being completely rebuilt and modernised, but the attractive thing about our location, is the bank will allow borrowers upto the full 95% and the valuation was within 200K of the banks price, and the asking price. These things need to be present later when you decide to sell, because a large percentage of buyers will borrow to as close to the maximum borrowable amount.
Bank values are based only on average locality transaction $$$ per SQFT ratios. They don't consider renovations or improvements made, although they will send somebody out to re value if there is a major value dispute/difference..
As to the open cheque, and being in person, regardless how your friend did his negotiating, in my case I am far more confident in that role than any agent here in HK, I found all to be rather weak in strategised communication, and far to self interested ( worried about their commission ) to be an ally of the buyer.
I will only negotiate with the person who owns the property, to gauge body language and see if they are bluffing, as I explained earlier, buying property is like walking into a lions den, and playing poker, ie having a poker face while you deal.
I made it clear to our agent that we wanted the property, and it would be upto him to work with us following our clear / realistic M O.
When you negotiate, you must be prepared to pay money right at the moment you can get signatures down on a document called a S & P, or a Sale and Purchase agreement. This agreement outlines all the things that are included in the property transaction, ie settlement periods, any furniture inclusions or repairs that need to be made prior to you moving in, a new contract drawn up by the vendors lawyer will be drawn up later, both the S & P and the main property purchase contract are legally binding....
A deposit must be paid upon an agreement being reached, it can be less than 10% on the day, the shortfall made up to the 10% amount must be paid within 10 days. Failure to do so, will incur a demand for the previous 10% balance, plus an additional 10% penalty.
You will discover that Village houses in 98% of cases, are going to be difficult to move, especially in the 6 plus million dollar range, as people who are going to potentially buy these properties need large cash reserves to meet the 40% difference. If it was a popular apartment complex, they only need to fork out 5% out of their pocket.
Anyway, see how you go, be firm and set a realistic target, you will spend more on renovations than you think, especially if the place is over 15 years old, and unlike in a the UK or Aus, where you can contract a surveyor ( for $400AUS ) to inspect the home, giving you a detailed condition report, here in HK its not something that would be encouraged.....
Good luck with your negotiations, and encourage your agent to earn his comission by not saying something stupid that burns the opportunity, ie FACE, a really annoying condition where the vendor is caught lying via the negotiation, and then it creates a road block, one that generally cant be resolved.
Its a very different ball game here, with an attitude that you just roll over and pay whats asked, unless its during SARS, then they drop their pants and off load property at 50% less than prices are today.
Go figure ....