Buying Property in Thailand
In recent times Thailand has emerged as one of Asia’s property hotspots. Every week new developments are announced in destinations such as Bangkok, Pattaya, Phuket and Koh Samui. There is a huge range of property in Thailand, from studios, to large houses with substantial garden areas.
This also means that there is a large difference in the price of these properties, so there is something to suit most budgets. Although the price of property in Thailand continues to go up, real estate is still relatively cheap compared to western standards. For a foreigner to buy property in Thailand legally, certain processes have to be followed.
Buying a Condo in Thailand
The most relatively easy way for a foreigner to acquire property in Thailand is to purchase a condominium. The Condominium Act of Thailand means that non-Thai nationals can purchase up to 49% of the rooms in any condominium development.
The funds for the purchase of the condo need to be transferred from a foreign, to a Thai bank account.Although buying a condo in Thailand is quite a straight forward process people should be aware of the associated risks. All paperwork and contracts relating to the purchase should be studied carefully, and different condominium developments will have separate by-laws and regulations. The buyer should acquire all the other documents relating to:
- The actual land upon which the condo is, or is going to be built.
- How the project is to be financed.
- The credentials and identity of the seller, or project developer.
When the research has been conducted, and the relevant information has been acquired, potential buyers should be confident about going ahead with the purchase. The buyer should be have ascertained that the title of the owner is good, and that buyers title will be good when they take ownership.
The developer should have the capital necessary to complete the project, and all contracts should be clear and fair. It’s important that a management company with a good reputation is conducting affairs to avoid complications.
If somebody wants to buy an “off-plan” property in Thailand a reputable lawyer should be hired to ensure that important aspects of the contract are covered. These include the timescale of the project, penalties for non-payment, room specifications and floor plan, and refunds for the development not being completed on time.
The Leasing of Land
Foreigners are unable to legally own land in Thailand, but they can lease land. The maximum duration of this lease is 30 years for a residential property. When the 30 years are up the lease is terminated as currently land offices are refusing to issue renewals.
Forming a Thai Company
A foreigner wanting to buy property in Thailand can create a Thai company, only in name, and then land can then be purchased under the name of the company.
It’s important to consider that the company has to be owned completely by Thai people when ownership of the land is transferred to the Thai limited company.
In recent times strict measures have been implemented by land offices to make sure that Thai shareholders are genuine within these companies. When the property comes under ownership of the company a foreigner can possess 49% of the shares in the Thai company. A lawyer with a good reputation should be used throughout these proceedings.
It’s possible for a Thai spouse to buy land in Thailand. The foreigner has to legally declare that the funds for the purchase of the land belong to the Thai spouse, and that as a foreigner, they have no rights relating to the ownership of the land. The foreign spouse, to protect their interests, should register a lease on the land.
Some foreigners are purchasing property in Thailand as an investment, whilst others just want a holiday home. There are a number of options available, but people should always use the services of a reputable lawyer and aim to buy from a well-renowned developer. It’s also important for those wishing to buy property in Thailand to consider stamp duty, the transfer fee and withholding tax.
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