loader
Luxury Villas and Property for Sale in Koh Samui & Thailand

10 Top Tips for Buying Property for Sale in Koh Samui

February 21, 2022
10 Top Tips for Buying Property for Sale in Koh Samui

If you’re interested in buying property in Thailand, the idyllic island of Koh Samui is likely to be one of your top choices. In this article, you’ll learn 10 useful tips (and a bonus tip) for buying property for sale in Koh Samui. You should expect overlap between the general tips discussed in Thai property purchases and Koh Samui purchases.

The caveat here is that Koh Samui, also known as "Coconut Island", requires some specific tips to keep in mind as an island paradise with gorgeous natural scenery and a relatively short rainy season of about a month.

How does one buy a slice of paradise while maximizing their investment? Keep on reading to find out!

1) Understanding the Legal Process

You naturally need to make general considerations appropriate for buying any real estate, such as looking for the right location within Koh Samui and choosing an independent agent that's reputable.

However, Thailand legal regulations might make things not as straightforward as other overseas property investments. As a foreigner, you're forbidden to buy real estate directly or outright in Koh Samui or Thailand in general.

You have to buy it as a company, renewable leasehold, or have a Thai citizen business partner or spouse buy it for you but it's in their name. It's not just that the laws are different when buying properties in your own home country.

So your options include using a company, using the Board of Investment (BOI), marrying a Thai national and having him or her buy the property for you, using structured ownership, or using lease of property.

You also have to go through hoops and possible loopholes when purchasing property as a foreigner or a non-citizen of Thailand. As a prospective buyer, you need to collaborate with your agent and lawyer to familiarize yourself with the legal options available.

2) Determining the Purpose of Your Investment

Why are you investing in a Koh Samui property in the first place? You should have a purpose for embarking on such a property sale. If that purpose could be achieved much more easily and less expensively by other means, don't go through with this.

If you specifically wish to get a Thai or Koh Samui property by personal preference, through your love of the country and its beautiful beaches, or because it makes perfect financial sense given your circumstances, then go through with the property search.

Do you wish to get a lifestyle holiday home? Then cross out properties that emphasize potential rental yields or don't buy a whole resort villa you won't be using as a resort in the first place!

If it's a 50/50 purchase for lifestyle and investment, then you should weigh-in your purchases based on this ratio. Don't buy a too secluded property you wish to turn into a timeshare or successful beach resort in the future.

Have a realistic exit strategy included for any "off-plan" project you're getting into so that your calculated risk has an accompanying damage mitigation plan if things were to go south.

3) Considering the Old Chestnut of "Location, Location, Location"

Whether you're buying a Texas, California, or Koh Samui property, it's still always about "location, location, location". This is a universal law of real estate. It also applies to Koh Samui villas, since Koh Samui only has a limited size of 247 square kilometers.

It also takes only 45 minutes or so to drive from one side of the island to the other. It's like New York or Japan in how limited its real estate offers are. Therefore, if you're going to invest in such limited space, every dollar and cent counts.

You should make sure the location within the island you've chosen is prime real estate indeed. You're not buying acres and acres of farmland. Instead, you're investing (by spouse, by company, or by leasehold) on a slice of the Garden of Eden.

Specifically, be on the lookout for Plai Laem, Choeng Mon, Bo Phut, Chaweng Noi, and places within proximity of shopping centers like Tesco Lotus or fine dining at Fisherman's village.

4) Conducting Preliminary Research

Do your research. After you've zeroed-in on a particular villa or area, visit the place yourself or read reviews before making that trip. Your research will reveal whether or not a short-listed property coincides with your investment purpose.

Read about the different towns in the island to see which ones offer the best ocean views or sunset/sunrise views as well as beach accessibility.

Survey the local area, know all the local hotspots, ascertain the proximity of restaurants and beaches, and find out from the start any issues or troubles that may arise in a given area (and whether they're worth the price).

You cannot allow delegation to handle everything on a property you wish to buy. Ultimately, you have to visit it yourself sooner or later by taking a drive around town and see with your own eyes the state of the property you're investing time and money for.

5) Weigh in on the Style versus the Substance of the Property

When searching for your Koh Samui villa of choice, remember the difference between style and substance. A property must look good for sure. However, it has certain aspects about it—its substance—that couldn't be changed by renovation.

This includes its location, size of the land, the view (ocean view, city view, or forest view), how noisy the area can get, and its floor plan. Style can be adjusted or fixed with renovation. This includes window coverings, paint color, and even tiles.

You can't renovate a land size area unless you invest in swallowing a separate neighboring property! Imagine what the property would look like if it were vacant and go from there. Is it a fixer-upper? Are you satisfied with its style?

Do you wish to renovate it because you're okay with its underlying substance? This is especially handy when buying a villa resort. Many of the villas offered in Koh Samui include pools of their own, but a limited few have a quality location.

6) Choosing the Right Real Estate Agent

Before choosing a professional lawyer to help iron out the details of Thailand real estate investment laws for foreigners, get a decent Koh Samui real estate agent first. Have him help you get a property to work with.

As a buyer searching for property in a foreign land, you need an agent to scour the best ones around. He'll help you get the best options in today's Koh Samui real estate market, since you're in unfamiliar territory and you don't know what to look for.

Your established purpose for buying this investment gives you a vague idea of what to look for, but until an agent helps you concretize such concepts, you'll be stabbing in the dark. He'll help you avoid bad locations and inform you of high-potential properties.

For example, if you want to own a resort real estate, he can point out an affordable deal for you in a fast-growing market that should pay dividends down the line in a decade or less as Koh Samui continues to undergo significant land development.

7) Appointing a Professional Lawyer

It's another crucial layer on top of getting a real estate agent. Thailand specifically forbids direct buy-outs to prevent foreigners running roughshod in the property market while their own citizens are left high-and-dry.

Therefore, you need a lawyer to help you maneuver through such legalities. Even so, you still need to do your own research and not be too over-dependent on your lawyer so that you can make informed decisions when it comes to which property to invest in.

Don't just accept a single person's advice, even if it's your lawyer. You also need contact with reliable locals and get options as to how to legally buy properties in Thailand as a corporation or under a renewable leasehold agreement.

Your lawyer choice can make or break your property deal. He should be able to guide you along the way and speak your language to make you feel safer in your purchase. His responsibilities include breaking down your options, costs, and property/land taxes.

He'll help you budget your investment while at the same time finding the best avenues for investment, whether it's by marriage or by BOI.

8) Dealing with Property Search and Viewings

It's now time to pick up your phone, call some agents, and then schedule a viewing. Preferably while you're already staying in Thailand to avoid any wild goose chases or wasted travel expenses.

Go for a weekend viewing off of work. Get about 3 beachfront properties in Koh Samui to look at per day. You might get lucky and find the perfect villa fit, whether it's a high-rise resort with multiple rooms or a 5-bedroom pool house with traditional Thai decor.

When dealing with Koh Samui viewings, you can also hunt for as many real estate agents as your viewings. Settle with the person you're most comfortable with. Build some rapport with them and open up to them.

Most likely, the agent that gets you the best property options will most likely earn your trust, although it probably helps as well if he or she is personable too.

9) Knowing Your Favored Type of Property

Seeing that you've settled down to Koh Samui in particular, it should be easier for you to figure out what your favored property type is. Most of the properties in Koh Samui are villas in some form or another, ranging from apartments to townhouses.

You can get vacation homes or outright rental or resort properties. You don't have to get a villa with a pool but it's the most popular option, they're readily available, and the consumer demand for Koh Samui villas tends to call for a pool.

However, if you don't want a pool villa you don't need to get a pool villa. Maybe you don't like the hassle of maintaining or cleaning infinity pools when the beach is just walking distance from your property.

Just don't forget that you're not allowed to hold the freehold of land in your own name. You can get a Thai national spouse, a Thai national business partner, or your company (owned by mostly locals) to make the purchase.

10) Short-Listing or Choosing Property

Once you've short-listed your top 5 or top 3 Koh Samui properties then you can compare them to your budget. Is there one you particularly want so badly that you're willing to save up for it or get a loan to buy it now then pay for the rest later?

Or do you wish to maximize your investment on a fixer-upper that you can improve through the years given time and rental money, like a resort requiring renovation that it can pay for itself through customers and tourists?

Make a mental list of the pros and cons of each of the short-listed properties. Go with the ones with the fewest cons and the most pros. Or acquire the most affordable one with great investment potential.

You can have a gut favorite but don't let your heart dictate your decision without your brain taking note if it's a wise one or not.

Bonus Tip: Conducting Due Diligence

Before completing a purchase of a property through legal means so that you can "take ownership" (or a spouse/business partner from Thailand would on your behalf), you should do some legal checks and financial considerations.

It's all part of your due diligence. The main areas of consideration involve whether or not the property has legal right of access. Also make sure that the property is unencumbered when it comes to debts, liens, and mortgages so you won't end up inheriting all those too.

The seller should obviously have legal rights of ownership to sell the property, whether it's in their name or it's an inheritance of sorts. Check if the property breaches Thailand or Koh Samui real estate regulations too.

You, your lawyer, and your real estate agent should have all of these discussed along with the percentage shares between agent and client, buyer and seller. Don't get hit by any snags belatedly. Fix everything now prior to making that paperwork!

When All Is Said and Done

The house and property market remains unstable in 2022, but Thai property market is still stable and a good place for investment, so you can use Koh Samui as an anchor for your investments. It can double as a resort, timeshare, or vacation home that keeps your money from getting burned out in today's economy.

A villa or a home there makes perfect investment sense (and cents) as we survive the rollercoaster of a pandemic we've suffered through since 2020. So what are you waiting for? Buy a villa at Koh Samui today!

 

Leave a reply

OTHER POSTs

Top 10 Tips for First-Time Homebuyers in Koh Samui, Thailand

By following these tips for first-time homebuyers, you'll be well-equipped to navigate the unique challenges...

5 Reasons Why You Should Invest In a Property In Koh Samui

Are you considering to invest in Thailand? This article highlights 5 reasons why buying real estate in Koh Samui is an opportunity that will benefi...

Buying a Vacation Home in Phuket: Pros, Cons, and Hidden Costs

Are you dreaming of owning a piece of paradise in Phuket, Thailand? With its stunning beaches, vibrant culture, and tropical climate, Phuket is a t...

5 Options for Foreigners to Buy Property in Thailand

If your dream is to own your own property in paradise purchasing Real Estate in Thailand as a foreigner is certainly possible, and we hav...

Investing in Koh Samui Villas for Sale: Pros, Cons, and Important Considerations

Investing in Koh Samui villas is like investing in a future lifestyle or mystical tropical wonderland. Koh Samui is right up there with Bangkok and...

Best Neighborhoods for Raising Kids or a Family in Koh Samui

You can’t go with Thailand as far as making it your family holiday vacation destination of choice. It’s a country full of wonder and de...

Koh Samui Building Regulations and Zoning Rules

Building Regulation in Koh Samui, is explained here in detail. The island is divided into several zoning system where only certain types of develop...

We believe our passion, creativity and commitment are the keys to helping you find your perfect property. Let's get started!