Buying property in Thailand as a foreigner can be a daunting task because of the multiple opinions on the topic. While you may have heard that foreigners cannot buy property, this is not true. There are many legal standpoints of buying property in Thailand as a foreigner and you can indeed buy certain types of Thai real estate.
While foreigners are allowed and permitted to buy freehold properties such as condominiums there are a few legalities to keep in mind to ensure a smooth transaction. For certain properties such as leasehold properties, foreigners are given vast options to make such villas their homes for 10 to 30 years.
Continue reading to know the best ways to navigate the legalities of buying property in Thailand and how to buy a condo in Bangkok or get access to leasehold property in Thailand for expats.
Navigating The Legalities of Buying Condos in Thailand
Condominium projects that are registered with the Land Office in Thailand can be legally bought by foreigners, and the title deed can be subsequently transferred to the new owner’s name. To verify if the condo project is registered, buyers can ask their realtors to verify this with the Thai Land Department or do it themselves.
However, condominium developers have to keep one important thing in mind before selling condo units to foreigners, as elaborated at great length in Section 19 of the Thai Condominium Act.
How Does Section 19 of the Thai Condominium Act Affect Buyers?
This act governs the percentage of condo land sold to foreigners versus Thai nationals. As a general rule a maximum of 49% of the development’s surface area should be sold to foreigners and at least 51% of the surface area must be sold to Thai nationals. This implies that the total floor area of all the units put together should be sold to a mix of Thai nationals and foreigners as per the 49-51% ratio mentioned here.
It is always a good idea to check the existing sold ratio by asking your realtor to do a quick reckon before you put down a token and sign any documents.
How Can You Buy A Condominium Unit In Thailand?
There are 5 vital steps to buying a condominium unit as a foreigner in Thailand.
The first is to find a realtor who can source a property for you to buy. After sourcing a suitable condo property, you should ideally do a private survey check to ensure that you are paying for the exact square meters mentioned to the Land Department by the developer. If the square footage doesn’t match the registered measurement, then this can be a source of trouble for you later on as you will have to pay for any extra land at a higher rate and this can also be a time-consuming process.
The second is to complete the needed checks to ensure that the property is registered with the land department and that the ratio of 49-51% is not exceeded.
The third is to negotiate and place a token amount and sign any documents that state you would pay the remaining amount within the stipulated time frame. Before you pay any amount to the developer you have to do a quick check that all the environmental and building codes have been followed, and this can easily be done by your chosen Thai realtor.
The fourth is to transfer the money from an overseas bank account and transferred it to Thai Baht. At this point in time, you will also have to get a FET Form also known as the Foreign Exchange Transaction form. The FET form is an important document needed to get the transfer of the condo in your name.
The fifth is to collect all documents, get copies of your ID proofs, collect the original and make copies of the Sale and Purchase agreement and give all of these documents to the land department to register the condo in your name.
Top 3 Questions Asked About Foreigners Buying Condos in Bangkok
Can I Buy a Villa or Penthouse/Townhouse in Thailand?
- Condos are typically registered as Freehold Properties under the Chanote Title deed and can be purchased by foreigners in Thailand. If villas, townhouses, and penthouses are registered under the Chanote title deed, then they can be purchased by foreigners. However, usually, such properties are registered under landed properties and sold/rented as leasehold properties. If this is the case, then taking a 10 to 30 years lease on the building or the land and constructing on it during the lease tenure is possible. However, you cannot legally own the land, you can only lease the land and own the structure built on the land.
What is The Importance of the FET Form?
- The FET form also known by Thai nationals as the Thor Thor 3 form, is mainly needed to register the condo in a foreigner’s name. This form marks that the foreigner has legally transferred $50,000 or more to Thailand, for the purpose of buying Thai real estate. The form falls under the regulations of the Board of Investment and the original copy of the form is typically needed to transfer the title deed from the developer’s name to a foreigner’s name. This form also ensures that section 19 of the Thai Condo Act has been followed by the foreign buyer and the property can be registered without any glitches.
Do I Need A Thai Bank Account to Buy A Condo In Thailand?
- While you are not mandated to have a Thai bank account to purchase a condo in Thailand, having access to a Thai account in your name makes your life a lot easier. This is mainly because you have to transfer the funds from a foreign account preferably in your home country to a local account in Thai so that the amount can be transferred from dollars, pounds, or any other currency into Thai Baht. This is one of the basic requirements of obtaining a FET form. To know the easiest and quickest ways to open a Thai bank account with leading banks, read this informative Silk Estate blog post.
Do You Need A Realtor To Buy A Condo In Bangkok?
While buyers can choose to purchase Thai real estate without the help of a realtor, there are many benefits to choosing one. For instance, navigating the legalities of buying property in Thailand is much easier with a realtor that is on your side.
Buyers are liable to pay a certain amount of fees to the Land Department as well as a percentage of the Sale and Purchase Agreement. Additionally, transfer fees, registration fees, and other miscellaneous upkeep fees are generally shared by both the buyer and the developer.
As per Thai laws, any developer can at maximum ask the buyer to pay 1% of the transfer ownership fees from the buyer. The developer is also legally allowed to at maximum half of all miscellaneous expenses to register the condo including the Sale and Purchase Agreement.
Yet, as the Thai real estate market is not heavily regulated, some developers may ask buyers to pay all the fees, as they are aware that not all buyers know Thai laws. This is one of the many reasons a trustworthy realtor such as Silk Estate can ensure that your best interests are always kept in mind when you buy a condo in Bangkok or any other place in Thailand of your choosing.
Choosing A Realtor That You Trust – A Quick Checklist For A Smooth Transaction
The points mentioned here should be considered as a base guideline before choosing a realtor. Good realtors can also guide you to Thai lawyers and property attorneys that can make your life that much simpler while you buy Thai real estate.
- Does the realtor have expertise in Thai property laws?
- Does the realtor specialize in selling Thai property to foreigners?
- Is the realtor interested in making a quick sale or does he have the best interests of buyers in mind?
- Does the realtor have a website, with informative blog posts on the topic of buying Thai condos?
- Is the realtor quick to suggest a property without considering your needs?
Must Know Facts About Silk Estate - The Top Thai Realtors and Best Thai Managed Property Service Providers For You
Silk Estate is one of the top Thai realtors as per the people’s choice as we offer specialized realtor services to ex-pats, foreigners, and investors that are searching for their dream property in Bangkok, Phuket, Pattaya, Koh Samui, and other coveted islands.
We don’t just offer listed properties that you can find online, we go the extra mile and offer unlisted and premium super luxury condos and villas in Thailand based on your unique requirements.
We offer our clients a no-obligation call back from our team of experts when clients choose to contact us for information about Thai properties. At Silk Estate we pride ourselves on always ensuring a smooth transaction from the start to the finish, and we also ensure that after you buy a property, you can enjoy premium managed property services through our company as well.
Read more about managed property services here and contact Silk Estate for all your Thai property needs.
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