Buying Property in Thailand - FAQs
Can I get a long stay permit (visa)?
Are there any property taxes to pay?
How to purchase a property in Thailand?
- Once you decide which property you wish to buy, we help negotiate the price and terms acceptable to you and the seller.
- If agreed by both parties a booking fee is paid.
- Then we recommend appointing a lawyer (licensed in Thailand) to act on your behalf. We are happy to provide a list of recommended lawyers or you can check the official site of the chamber of lawyers in Thailand which can be found here. The lawyer will perform a complete due diligence and inform you of any problems prior to signing the contracts.
- At this point a deposit is paid and the contract is signed by both parties or via power of attourney.
- Later the agreed purchase price is paid to the seller according to the terms in the contract and the property is transferred at the land office with the help of your attorney and realtor.
- Taxes are paid at this time to the tax office and the property is registered in your name or the name of your company.
What are the costs of buying a property in Thailand?
- Between 1.1% and 3.3% purchase tax
- Legal fees are typically less than 1% and negotiable
- Property management (CAM) fees are usually paid 1 year in advance and might or might not be part of closing costs. They should be no more than 0.01% of purchase price.
- Bank fees, wire transfer costs, small various should be no more that $100-$300
- Realtor fee (paid by the seller or developer)
How do I register my vehicle?
If you are going to be living in Thailand for any length of time you'll naturally want to have you own vehilce to get around. It just makes life so much easier. Foreign citizens in Thailand who buy a property will be issued a Tabien Baan (house book) and may register a purchased car or motorbike in their name. For this you will need your Passport, Tabien Baan, 2 photos, and residence certificate application form (available at immigration office) and this can be done at the dealership or at the department of transportation.
Can I open a bank account in Thailand?
If you are living in Thailand for an extended period of time, you will want to open a Thai bank account as a foreigner. Most banks require your sales and purchase agreement, your passport and a deposit. Most policies and rules depend on bank employees and branch managers so be prepared to go to more than one bank if needed.
How can I pay utility bills in Thailand?
In Thailand, it's a simple process to pay your utilitiy bills and this can be done at your Bank or Post Office during normal working hours. For a small fee, utility bills can also be paid at any 7-11 store as long as they are not overdue. For foreigners who plan to leave the country, it is possible to pre-pay your utilities so they are on when you return.
Who offers property insurance in Thailand?
There are many companies offering insurance in Thailand. You will find policies of all sizes and rates are competitive. AIG is one of the largest and they offer policies for your home or condominium that cover just about anything that could possibly go wrong.
Does Phuket have an International airport?
Phuket does have an International Airport with direct flights to Dubai, Zurich, Helsinki, Istanbul, Doha, Abu Dhabi, Moscow, Irkutsk, Novosibirsk, Melbourne, Sydney, Seoul, Hong Kong, Taipei, Shanghai, Beijing, Chengdu, Shenzhen, Dehli, Bangalore, Ho Chi Minh, Singapore, Kuala Lumpur, Phnom Penh, and more. Phuket International Airport has just been expanded and is the second busiest airport in Thailand.
What can a foreigner buy?
There is a general perception that Thai property law is complicated. Actually, the opposite is true. The laws relating to foreign property ownership in Thailand are quite clear and straightforward. Foreigners can buy and own condominiums. Foreigners can buy and own buildings and structures, such as villas (distinct from the land). Foreigners can buy condominiums, villas and land as leasehold. Foreigners cannot own land.
What does freehold mean in Thailand?
Freehold is the most complete and absolute ownership interest that can be held in property. Freehold is where the property belongs to the owner indefinitely (as opposed to 30, 60 or 90-year leasehold).
Can a foreigner own land in Thailand?
Under the current laws of Thailand, foreign ownership of land is restricted. The Land Code of Thailand generally prohibits the ownership of land by foreigners; this applies to both individuals and legal entities. Therefore, foreigners must purchase land through leasehold in Thailand.
What are the main types of land title deeds?
Land titles are the most common evidence to prove land rights of possession and other interests in land. In Thailand, there are various types of land titles that each provide a different level of security for the buyer. We suggest only considering these 3 land titles for leasehold.
The most secure land titles in Thailand are:
1) Nor Sor 4 (Chanote)
2) Nor Sor 3 Gor
3) Nor Sor 3
The highest land title in Thailand is "Nor Sor 4" commonly referred to as "Chanote". All land titles listed above can be sub-divided, re-sold, or transferred.
Are there any loans available for foreigners?
We are aware of three banks that offer loans to non-residents buying a property in Thailand. However, we do not feel that they offer competitive loans or terms to be attractive.
What amount of rental income can I expect?
Tourism in Phuket Thailand is still growing at a fast pace and the rental market remains strong. Most property owners can expect annual rental yields of between 4 and 8% for condominiums and villas on the coast. To maximize rental income, it is important to buy where there is proven rental demand and in recognized developments.
How do I know I am getting a good deal?
There are many factors that we need to consider when talking about the value of a property: A) location. B) view. C) size of the property. D) state of the property. E) state of the market. Traditionally, location is considered the most important factor in determining the value of real estate worldwide. In our market it is no different and proximity to the beach in one of the biggest influence. A Rental Yield calculation quickly identifies which properties present a better value.
What is the best way to compare properties?
In most cases, comparing properties on a formal basis helps investors determine which one offers the best value. For apartments and condominiums simply divide the purchase price by the size of the unit to determine price per square metre.
Example: Price per m2 = (5,400,000/48) = 112,500
For villas we divide the purchase price in half to calculate built-up area plus land for combined price per square metre.
Example: Price per m2 = (7,500,000/197) + (7,500,000/436) = 55,273
Another measure used to compare properties is yield. This is calculated by taking estimated or actual annual rental income divided by purchase price expressed as a percentage.
Example: Yield = (800,000/10,000,000) x 100 = 8%
How can I get the best foreign currency transfer rate?
Using a foreign currency transfer broker when transferring your funds abroad could save hundreds if not thousands of dollars and only takes a little planning. Foreign exchange transfers are key to maximizing the value of the currency you are sending. Fluctuations in the exchange rate and fees can have a huge impact on the overall cost of your property purchase. A currency broker is a cost effective alternative to the bank rate and you can find more information here.
Do I need a real estate agent in Thailand?
If you are buying property in Thailand, you will probably need to enlist the help of a real estate agent to view a selection of their property listings. A knowledgeable agent can usually save you both time and money. Not all realtors in Phuket are the same. Just remember to avoid treating the information and advice provided by a salesperson as undisputed truth.
Do I need a lawyer to buy a property in Thailand?
It is surprising how many buyers view legal advice as a cost rather than an investment. It is not legally required to hire a lawyer to complete a property purchase, but we strongly recommend doing so. The lawyer or solicitor will act on your behalf and typically they break the work down into 3 sections, due diligence, contract and contract review, and legal transfer of ownership (at the land office). Once engaged, your lawyer will then be available to offer to advise when needed.
Can I use my solicitor from back home?
Can I sign a power of attorney in Thailand?
Should I have an exit strategy?
Formulating an exit strategy for each property you buy just takes a few minutes of careful consideration. Knowing in advance your exit strategy will almost certainly influence a number of decisions that are subsequently made in relation to a property investment.
Are there zoning laws in Thailand?
Only about 35% of Phuket can be developed according to the current zoning laws and building regulations. The Phuket zoning map divides the Province into 16 different color-coded zones of which about 65% must remain undeveloped and reserved for agricultural use, forestry reservation, and environmental preservation. Phuket also has a building hight limit of 24m and a construction height limit of 80m (from sea level) referred to as the 80m rule.
What's a reservation agreement in Thailand?
When you have decided on a particular property and reached an agreement with the seller a reservation is signed by both parties. A reservation payment or booking fee is made to secure the property and take it off the market. The payment is typically 1% or less and will be used toward the purchase price of the property.
What is “off-plan” property in Thailand?
Off-Plan property is basically buying the rights to a property that has yet to be built, as opposed to buying a finished property. Some benefits of buying at the preconstruction stage is the price discount in addition to payments only become due according to the construction progress. It’s important to choose a reputable developer with a good track record to minimize the associated risk. Keep in mind that your rental income will not start until after the project completion date.
What are guaranteed rental returns?
Many condominium developers are now offering Guaranteed Rental Returns to buyers searching for an investment property. For example a new property might offer “7% Guaranteed Rental Returns for 5 Years”. The guaranteed rental return will be in the contract and the owner is limited to the amount of time per year they can occupy their unit. It's required to purchase the developer's furniture package to participate.
What are CAM fees in Thailand?
Common Area Management (CAM) fees cover such things as security, road access, and parking, shared swimming pools, gardens and landscaping, elevators, reception area and facilities such as gyms, clubhouse, library, saunas and steam room, water storage facilities and electrical infrastructure, pest control and garbage collection. CAM fees are usually paid one year in advance.
What is a sinking fund?
A sinking fund is a sum of money that is set apart by the developer to meet the cost of major replacements and repair work to the developments common areas. Owners are collectively responsible for funding the sinking fund.
How is land measured in Thailand?
In Thailand, while square meters are used for measuring floor areas of villas and condominiums, the unit of measurement used for land is “Rai, Ngan and Wah.” One Rai of land is equal to 1,600 SQm. (See Land Measurements for more details).