Are you planning to buy a property in Thailand? Thailand is known for its sandy beaches, bustling market roads, and long island iced teas. But did you know that it is also an ideal place for foreigners who want to own a property with a higher purchasing power while spending less due to a lower cost of living?
However, buying property in Thailand can be tricky, especially for foreigners who are unaware of the laws and regulations. To avoid making costly mistakes, it is essential to do your research and take your time before investing in any property.
In this blog post, we will highlight the top mistakes to avoid while buying property in Thailand.
From rushing to sign the deposit document to failing to do adequate research about property types and title searches, we will guide you through the essential aspects you need to consider before investing in any property in Thailand. So, whether you are planning to buy a property in Bangkok, Pattaya, or on any of the coveted islands, keep reading to learn more.
The first stop. Understanding the basics of Thai property law.
According to the laws of the tropical paradise, Thailand foreigners can invest only in certain properties such as condos. However, Thai citizens can invest in condominiums, freehold properties, villas built on land, and much more.
Contrary to the popular belief set ablaze due to unscrupulous sellers, many foreign buyers believe that they can buy land on islands. In actuality, coveted islands such as Koh Samui, follow similar laws as the rest of Thailand, where Thai citizens can buy land while foreigners cannot.
Knowing the law can help you avoid mistakes while investing in Thai properties and the best way to be aware of the law is by doing your research before making a purchase. Listed below are the top mistakes to avoid as a foreigner while investing and buying properties in Thailand.
Signing The Deposit Document and Putting Down Money Too Early.
Chances are that you have found your dream property on day 1 (hopefully with Silk Estate), you love the property and think it’s perfect for you. In your mind, you have already planned and thought of every detail, fixture, and furniture in the house. While this enthusiasm is excellent on many occasions while buying a property it can do more harm than good.
Before placing the initial token, and signing any document there are at least 3 points to consider. The first is, are there other similar properties in your budget with better developers?
The second is, if in case you change your mind, will the developer refund the initial 15% deposit amount?
The third is, does the contract give you any wiggle room in case the deal falls through and you cannot pay the balance amount on time?
Take some time to go through the contract and also look for other properties before placing the deposit too soon. When in doubt, refrain from acting instantly with your heart as acting in haste and signing a legally abiding contract without proper clarity can backfire.
Keep in mind that while the developer might indirectly rush you to place a deposit, most developers do not refund the deposit unless they back out of selling the property to you.
Failing to Do Adequate Research About Property Types and Title Search.
The best way to plan for a dream house in Phuket or any other location in Thailand is to read about the laws as much as possible. There are a dozen sites that can help you understand the legalities of the Thailand Real Estate Market.
If you are a foreigner and are planning to invest in real estate for succession, inheritance, living, or even leasing purposes, then read the informative blog about Top Ways Foreigners Can Own Property In Thailand.
If you are planning to invest in Bangkok real estate or elsewhere in Thailand through shares or mutual funds then it is critical to check the performance of the company. This rule also applies to buying any property from developers. Checking the feedback of past clients who have dealt with the selected developer is a good starting point.
Before buying a property, performing a title search is equally important, and this can be done either by you approaching the land department directly or by asking your realtor to do this for you. Keep in mind that if you do not know to speak Thai languages, then delegating the task to a trusted property advisor is a smart move.
A title search can ensure that the developer has the legal rights to sell the condo to you and that the property doesn’t have any pending litigations on it. A title search can also help you understand important facts about the condo project such as the area of the land on record.
If you are planning to invest in real estate through shares or mutual funds then it is critical to check the performance of the company. This rule also applies to buying any property from developers. Checking the feedback of past clients who have dealt with the selected developer is a good starting point.
Performing A Title Deed Search In A Rush Without Also Conducting A Private Survey of The Land.
If you plan to purchase a piece of land or a house the land is built on through a limited company, with or without the help of Thailand shareholders, then this point applies to you.
Many sellers tend to understate the actual area of the land while registering it, as this saves them a pretty penny on the price, fees, and government charges. In such cases, when the title deed is transferred to you, if there is a discrepancy found, between the recorded area versus the actual area then, as the buyer you will be liable to pay for the actual area of the land.
In such a case you will be charged a much higher amount for the piece of land you intend to buy with possible financial penalties as well. Performing a private survey of the land before you buy it is the best way to safeguard your interest and avoid mistakes while purchasing property in Thailand.
Penny Pinching Is One of The Top Mistakes To Avoid While Choosing New Property Developers.
There are a dime a dozen new realtors in Thailand that are working to convert urban areas into metropolitan and posh prime real estate.
Choosing a new developer in a haste or opting for a mismanaged property in an attempt to save money while buying real estate doesn’t work out in the long run. The hassles of buying such a property often overpower the perks of investing.
Always research before buying any condo unit from new developers, go through blogs from trusted realtors such as Silk Estate, and also do your own research to be doubly sure!
Even if you choose a new developer, look for brands such as Singha Estate and Villah Qabala by DNA Collection, as these brands have worked hard to instil a sense of trust in buyers since their launch.
If you want to know more about such developers then do read the blog post, What Makes Villa Qabalah One of The Best Luxury Eco-Friendly Villas in Phuket?
Looking for Cheap Options While Expecting The Best-Established Property Development Projects.
Looking for your perfect home within your budget might be possible, however, penny-pinching and looking for the cheapest homes in your budget will only get you so far.
Time and again it has been seen that new developers offer prime properties at low rates while failing to mention that they have future plans that might affect you. These plans include expanding the construction and building another project right next to yours. Clarifying these points well in advance can save you the heartache of living right in the center of a construction zone.
While looking at ads, listings, and properties, you have to make sure that as a buyer you look for efficient developers who follow the legal code to the letter. You also have to check for the surroundings, if the area is safe to stay in, amenities in the area, and amenities the developer is offering to you as part of the deal.
Choosing the Wrong Real Estate Developers That Do Not Offer Amenities and Needed Facilities.
Choosing a home also involves opting for a complete environment that gives you peace and tranquility. You have to focus on all the details, right from the quality of fixtures inside the house to open kitchens versus Island shaped kitchens, modular fittings, smoke alarms, and even the quality of construction material that has been used to build the property.
If you are pre-booking then you have to be sure that the developer completes the project on time so that you can get possession of the property on the promised date.
You also have to focus on a few additional points before committing to buying real estate. These points include rules about using common amenities in the complex such as gardens and pools, your vote while living in the property about issues that may happen in the complex, and your shares while selling the property as well as general interest pools in case you chose to invest in condotels.
Like most things in life, prime properties don’t come cheap. They come at a high price and while there can be a comparison between various prime properties, at the end of the day choosing between real estate options has to be done based on the merits of the developer and the comfort of living in the chosen property.
Buying A Property In Thailand By Avoiding to Hire A Real Estate Agent.
Irrespective if you are a citizen of Thailand or a foreigner looking to invest, there are many reasons you need to have a lawyer as well as a real estate agent on your payroll while buying property. This is part of the due diligence and must be done to ensure that the property you get is actually what you pay for.
Hiring a reputable property advisor who can act as a liaison between you and the developer can work in your favor. Property experts not only list prime properties in the area as soon as they hit the market but also know which developers and property sellers are worth choosing.
Reputable real estate agents can also provide valuable insight into the surroundings, help you understand legalities and building codes, and inform you of the priority of prime properties that will soon be listed. In a nutshell, they can give you the cutting edge you need to purchase the best property in your budget.
Not Thinking About the Future Is One of The Top Mistakes To Avoid When Buying Thai Property!
Leasehold properties such as a house with a green and beautiful surrounding area with open skies and starry nights can be perfect for you while you live in Thailand. However, there is a major pitfall in investing money in constructing a house on a leasehold property in Thailand.
Thailand’s legal system is that condos can be transferred to heirs through a legal title deed succession, however, if you have leased a piece of land and constructed a house or a villa on top of it, then this may not be transferable, with very few exceptions.
Finding out these exceptions through the help of a property expert is one solution that can work out in your favor especially if the exceptions apply to you.
Planning to Do It All By Yourself Is A Top Mistake! Always Hire Legal Help To Avoid Problems Now And Later On As Well.
To be safe, irrespective of the type of property you invest in, hiring legal aid can save you a lot of heartaches and financial loss later on in life. this is especially true if you have plans to give your property to your heirs after a few years through the rights of succession.
An important point you need to remember is that Foreigners who are buying property in Thailand for succession should note that it is crucial to have a Last Will & Testament drafted, signed, and kept ready in both Thailand as well as in your home country. This legal document must have information about the purchased property and should preferably be drafted by a lawyer who is well-versed with the rules, exceptions, formalities, and legalities of Thailand.
While purchasing land in Thailand by foreigners is not possible, there are a few exceptions that help you achieve this task. A reliable real estate agent can help you understand these exceptions such as buying property through the Board of Investment and its many perks.
A reliable real estate agent can also help you get 30-year leases on villas, freehold land, and other properties by showing you options and ways that work in your favor.
Silk Estate – Finding Your Dream Home In Thailand By Navigating The Property Market and Legal System Effortlessly.
Silk Estate is a prime property platform for foreigners and ex-pats seeking to invest in Thailand real estate. Along with giving you numerous options, we also offer you consultation and advice and enable you to get the best property in your budget without a hitch.
Right from condominiums to leasing land for extended periods, we have all the solutions desired by your heart that fit your budget. Contact Silk Estate today to make investing in real estate a pleasant and smooth task.
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