Can I own a condominium in Thailand?
How to buy condo in thailand Overview:
The rules for selling or purchasing Condos changed on April 27, 2004. After that date, if more than 49% of the Condominium units in a Condo building are owned by foreigners, Thai persons cannot sell their unit in that building to a foreigner and put in a foreigners own name. Foreigners can sell their units to anyone - the restriction applies only to Thai persons.
The current rule allowing foreigners to own up to 100% was a special waiver of the "old" rule limiting foreigner ownership to 49%, was put into place during the currency crisis, and was renewed each year. That "special waiver" was not renewed this year.
The "special waiver" also included a reference to condos built on a particular number of rai. That rule was not in the old rule, so after April 27 it will not apply. Thai persons who are interested in selling their unit in a building over 49% owned by foreigners need to make the sale before April 27, 2004 - because after that date the foreigner will not be able to put the condo in his/her name. Since foreigners usually pay a bit more than a Thai for the same property, Thai persons interested in selling their units need to be aware of these rule changes.
Foreigners married to Thai's, or foreigners who have purchased Condo's in a Thai persons name, in a building that is, or could, go over the 49% rule, might consider changing the ownership of their unit into their name (to establish foreign ownership). Most Condominium managements know what the percentage of ownership by foreigners is. For example, Grand Sukhumvit Condominiums are 68% owned by foreigners, well over the 49% rule. Check with your Condo management for your current percentage - and consider what the future might bring. This ownership rule only applies to condos not to buildings or land.
If you are buying or selling any real estate, remember that the total tax and fees on property exchanges are now approximately 5.5% of the government determined value (not the sale/purchase price), and who pays them is a matter to be negotiated between the buyer and the seller. You have to have a competent lawyer to handle your property transactions - it can save you a lot of trouble now, and in the future.
Buying condominium in Thailand Requirements:
The only restrictions on purchasing a condominium are that the percentage of units sold to foreigners cannot exceed forty nine percent (49%) of the total number of units in the condominium block; and that the funds used to buy the condominium have been remitted from abroad and correctly recorded as such by a Thai Bank on a Tor Tor Sam. Purchases of condominiums by foreign individuals come under the jurisdiction of the Condominium Act B.E. 2
A foreigner buying a condo must transfer funds in foreign currency from a bank account outside Thailand to an account at a Thai bank. The name of the transferree must be the same as the name that will appear on the final purchase contract, ie. the buyer. Use Bangkok Bank, Kasikorn Bank (f.k.a. Thai Farmer's Bank) or Siam Commercial Bank and be sure you tell them that funds transferred to the account will be used to purchase a condominium. Transfers must be made in amounts USD 20.000 or more in order to qualify for a Foreign Exchange Transaction Form issued by the buyer's bank to verify that the originating funding came from outside Thailand in a currency other than Thai Baht. This bank certificate explicitly states that the Thai Baht funds are used "to purchase a condominium" in Thailand. The department of Lands (Land Office) will refuse to execute the ownership transfer if the bank certificate cannot be produced.535 (1992).
What is Tor Tor Sam (3)
A Tor Tor Sam (3) is an official bank document issued by the receiving bank upon the receipt of foreign currency into your bank account in Thailand. You must request a Tor Tor Sam from your bank when you are remitting funds to Thailand for the purpose of purchasing a condominium, and the Tor Tor Sam must specify that the remittance is solely for the purpose of purchasing a property - Code 5.22.
The owner of each condominium is issued with a certificate of unit ownership. The certificate also has a statement saying exactly what percentage of rights over the common areas of the building each owner has.
FREEHOLD VS. LEASEHOLD LAND - Attention Condo Buyers!
In addition to the different types of land title deeds, you should check to see what type of ownership applies to the property, particularly for condominiums.
Be sure to check how long the lease is on the land on which your condo is located!
Freehold means that you own the property outright. You can buy, sell, trade, and leave the property free and clear to your heirs and there is no worrying about an expiring land lease if your condo building is on the land.
Leasehold means that although you can buy a condo within a building where leasehold conditions apply, you may only have rights to the property underlying the condo for the period of the lease. The land owner where the building stands retains ownership rights of the property - and only leases out the land to the owners of the condo. Leases generally are for a 30-year period. Sometimes the lease contract may specify that the lease can be renewed for a further 30 year period. A leasehold property may be bought, sold and traded, but you may not leave the property to your heirs to own in perpetuity.
Our services for Buying Condominium in Thailand:
1) Title search
Scope of services:
- Conducting a search on the title and relevant documents of the condominium.
- Ascertaining that the title document is in order.
- Ensuring that a seller is the current owner of the condominium.
- Confirm the lack of mortgage on the property, and the lack of further encumbrances, if any, on the condominium.
- Check actions against the seller in both local courts and the Central Bankruptcy Court.
- Verifying whether there is any restriction on the development of the condominium.
2) Prepare/Review The Sale And Purchase Agreement
Scope of services:
- Verifying the sales agreement.
- Providing comments on clauses of the sales agreement.
- Negotiate modifications as needed to protect your interest.
3) Registration of transfer ownership
Scope of services:
- Preparing the application and supporting documents required for the registration of the transfer of ownership of the property for you as a foreign buyer.
- Registering, on your behalf, at the Land Department.
Our English specking lawyers have years of legal experience. We can assist you for buying a condominium in Thailand and recommend to you the best course of action for your stay in Thailand.