It is a good time to buy property
in Thailand. Banks are lending & property prices are now dropping
due to the insecurity of the present economic situation. The
exchange rate is roughly around Baht 43 = US$1.LAND
AREAS: 1 rai = 4 ngarn = 400 wah2 = 1600 m2; 1 talang wah = wah2
= 4 m2; 1 acre = 2.53 rai & 1 ha = 6.25 rai
To date foreigners may
own
- a unit in a registered Condominium
- a
building (as distinct from its land)
- a
registered leasehold of up to 30 years for all types of titled land
(and/or buildings).
- a company can purchase land and buildings only.
- more than 40% of a condominium unless in Company form.
- foreigners can own land being 39% in a company but cannot secure a
mortgage
- if you invest 40m baht you can buy 1 Rai of land in Thailand outright
A 30-year lease can be a good idea
with right to renewal to a freehold purchase, or a Thai company (7
PARTNERS) can be established with Thai majority shareholders. Foreigners
only own 49% shares in a company with individual ownership of the foreigner holding land based on 39%
ownership. We can assist you to make sure your
company is safeguarded. Remember if you need advice ask us.
USING OUR SERVICES:
 |
WHATEVER YOU BUY OR
BUILD IT PAYS TO ASK THE EXPERTS & GO SLOWLY |
We now
provide an outhouse consultation at your Hotel if you require assistance
with any Business ideas or housing advice with our foreign consultant.
Highly recommended if coming to live in Thailand &
especially ChiangMai. Cost is 1000 baht hour.
We receive our commissions off the seller
or landlord and no added charges are imposed on you the buyer or renter.
What we make sure is you get a professional service with no hidden costs, plus
we help you with your lease agreements and oversee everything you need. You may have a Thai friend who says they can
get you a better deal. Unbeknown to you they may be getting a
commission or even 2 plus a scheme --can
you read Thai??. Using our services we guarantee that the lease and selling documents are in order as we have our own
Barrister at Law. Please do not ask us for mortgages as we cannot help unless
you are married to a Thai or own a Thai Company.
BUYING
YOUR HOUSE:
Thailand has so many different types of
properties for sale that whatever your dream home is, you can realize it
here if you do the paperwork right. Prices are a lot cheaper than
Western houses but some aspects need close scrutiny especially wiring,
water & most importantly the deed title. Now that you want to buy a
house what should you look for?
The first thing you need to do is obtain the services of a reputable
real estate agent or lawyer on your behalf. The Thailand Realty Industry
is not regulated so watch out for agents forcing you to sign contracts,
& check the title
deed to make sure the property is what it says. Do yourself a big
favour and obtain a House Inspection report which in effect pulls the holes
out of the property! Some buyers have bought
the house only to find the land is on a different title & visa versa
or the cracks have been disguised. Once you buy then its your problem. Many Estates will try to sell a house in a developing block which
has but one title with say 10-20 houses on it. They probably have 2
mortgages and want to unload the houses before they pay off the loan
& secure the titles for their owners. Or will they???--- we had
a case in May 2002 & saved the foreign buyer 2.8m baht that he would have
lost if he did not use our service. The same goes with the boundaries of the property which need to
be the same as the title deed. In Thailand there's no survey pegs as
such but they do use concrete pegs & it is an important point. Sometimes vendors deliberately
understate property area or move so called pegs. If the building is under construction or
the land is having a subdivision look carefully at the provisions for
issuing a title, and easement rights. if you are a foreigner you can
only lease for 30 years or form a company to hold the house.
WHAT
IT ALL MEANS:
Sor Kor 1
This
document means that land occupants are occupying or making use of
certain land plots, whose ownership has not been claimed by any entity.
The document does not indicate legal possession of the informer so one
cannot transfer the ownership of the property to any one else. The Sor
Kor 1 is rare now as the government's land ownership legislation has
covered most area of the country.
Nor Sor 2 states the government's permission for person or legal entity
to make use of land temporarily. Need to utilize at least three-quarters of
the land plot within three years after the document issuance. This right is non
transferable. At the finish, land occupants can seek the right to demand
higher privileged title deed.
Nor Sor 3 is a governmental letter certifying a utilization of certain
land plot by certain people and that the plot of land has been surveyed and
its official map created.
Nor Sor 3 A is similar to the Nor Sor 3 certification. The only
difference is the map survey of the land plot based on an aerial-viewed
photograph of the land.
Ownership Title Deed or chanote is the ultimate certification of
land ownership. Holders of the title deed have full rights to transfer
or sell the properties and to bar other parties from violating their
rights over the land protected by the ownership title deed law.
ESCROW SYSTEM When making a down payment on unfinished project, protect your
money from fraud by the Escrow account system which will ensure
your money will not be paid, unless the developer completes construction
of your new home and meets the agreed require
ment on specification. If
you decide to build use a [ lawyer
]
USING
A NOMINEE & MORTGAGE:
Usufruct Interest (Sidhi-kep-kin)
- gives you temporary ownership rights to structures on or arising from the
land. In practice, a usufruct is limited to a 30 year maximum period;
like leases, the agreement can be successively renewed. In contrast to a
lease, a usufructury interest can be sold or transferred, although it
expires upon the death of the holder of the usufruct and therefore
cannot be inherited.
PAYMENT:
A deposit of 30% is usually required to
secure a property and total payments should be made within 30-60 days
(see your lawyer first) but normally once the transfer has gone through. If signing a purchase
agreement then up to 30% down & 70% following transfer. You can obtain longer periods but you will probably be required to
pay a higher deposit. Deposits are normally non refundable, except by
default of the vendor, so bear in mind that once the deposit is placed
you are committed.
This situation also prevails for the vendor. He must refund your deposit
and pay a penalty of an equal amount if he defaults on the contract.
Deposit in escrow is still rare in Thailand, but it is becoming an
increasingly recognized way of proceeding. It generally trades off
greater security for the buyer's deposit versus a weakened claim for
damages in the event of vendor default.
Beyond the price, payment and closing schedules, it's important that a
contract includes clauses to cover who will pay the legal fees, transfer
fees and taxes (there is often a business tax and always an income tax
assessment made at time of sale) as well as an understanding of the
value at which the sale will be declared - this is typically (for tax
reasons) at or close to the government minimum assessed value.
A foreigner buying a condo must transfer
funds from a bank account out of Thailand in foreign currency and verify
the transfer on paper. The transfer of funds must be in the same
name as the name that will appear on the final purchase contract ie. the
buyer. Funds must be transferred into a Foreign Currency Account in
Thailand opened in the Buyer's name. Use Bangkok Bank, Thai Farmers Bank
and Siam Commercial Bank and make sure you tell them that the purpose of
his or her opening a Foreign Currency Account is to purchase a condo in
Thailand. This law is somewhat a catch 22 situation as the Foreign Banks
usually will not write such a letter but don't worry. You can remit as
much as you like to Thailand via your bank. Transfers out of this Foreign Currency Account in Thailand
into a Thai Baht Account or some form of Thai Baht draft or check to the
Seller must be made in amounts US$5000 or more in order to qualify for a
"Tor Tor 3" Certificate issued by the Buyer's bank to verify
that the originating funding came from outside Thailand in a currency
other than Thai Baht. On the "Tor Tor 3" Certificate, it
should state explicitly that the Thai Baht funds are used "to
purchase a condominium" in Thailand. Taxes are payable by the buyer
or seller of a condo in Thailand such as the Transfer Fee/Stamp Duty Tax
of 0.5% usually payable by the seller upon the date of the actual sale
or a Special Business Tax of 3.3% which is usually payable by the seller
if the property has been owned for less than 5 years. By the way there
is no limit on how much you can remit into a Thai account from overseas
and no tax. Tax levied at 15% is on interest earnings only.
Buildings apart from condominiums do not
have any form of title document, but their sale or long lease can be
registered at the Ampher (district) land office. Proof of ownership,
must be established either from proof of construction or document
showing previous sale-purchase (not to be confused with the House
Registration document, which is only a register of the house's
occupants).
BUYING
A CONDO:
A foreigner can ONLY own a condo in
his / her name OUTRIGHT. You cannot own a house and land in your name unless you
invest 40m baht = 1 Rai of land. Bank's do not lend to foreigners;
only Thais or Companies and you must lease, or have a Thai Company to own
a house in your name.
We cannot assist you
with any mortgages so please ask your Bank. If you have a Thai
wife then OK.
Just a note about buying Condos. ---Find out what the monthly maintenance
costs are from the managers. Ask for this in writing. Avoid unfinished
projects as they may run out of money or be over mortgaged. If very few condos have been
sold in a building with good amenities like landscaped grounds, security
Guards and a receptionist and office have the title searched but most of
all someone has to pay for all this, plus
the electricity for lighting and lifts. The total cost (often inflated) has
to be divided up among the condo owners, which can be a lot if only a few
units have been sold. Ask for an exact statement of maintenance costs and
how they are paid. If the project has different size condos in the same building, large units will pay more towards maintenance costs than small
units. If you are a legal resident you can obtain a mortgage but you
need to check with your bank and credit. The best idea though is pay
cash as you can negotiate but you must remit from abroad. In Bangkok look at around 25,000 -100,000
baht per sq m. A foreigner can only buy max 40% of a condo unit so if
that 40% has been taken up and you are the 42% person you may find you
are buying a lemon so to speak. If the developer owns a majority of
units you may not like his manager but if the owners have majority votes
than they can remove him.
The Condominium Act has been
amended. Now 49% of units in all condominiums and 100% of units in
condominiums in a total development area under 5 rai located in Bangkok,
all municipal districts and such other areas as shall hereafter be
announced by the Minister of the Interior (which is expected to include
rural Phuket) can be foreign owned. Funds used to buy a condominium
& remitted from abroad are recorded by a Thai Bank on a Tor Tor Sam.
Purchases of condominiums by foreigners come under the Condominium Act
B.E. 2535 (1992). The owner of each condominium is issued with a
certificate of unit ownership. The certificate also has a statement with
percentage rights over the common areas of the building each owner has.
COMMISSION
PAYMENTS:
Are normally levied on the seller rated
at between 3 & 6% of the asking price. Some agents are known to
charge a commission from both the buyer and seller. Due to the
unregulated realty industry you must use discretion when buying off any
agent or person. If they say the price of a house does not include their
commission, chances are this company is getting a cut both ends. Our
company levies a commission solely on the "seller" & makes
sure the person buying is getting the best deal for their money. We
normally only sell houses that have a chanote (title).
ONSITE
INSPECTION REPORT:
If you want to make sure your house is
safe and has what it should have & hasn't had recent false
renovations, hidden maintenance, then we also conduct a professional onsite inspection house
appraisal of the home you want to buy or sell. This inspection is over and
above your title search but compliments the title search as we work in with
our own lawyer. This 5-8 page onsite
inspection report covers everything from electricity, inside and outside structures,
water supply, plumbing, and general condition of your house & land,
elevation etc in a check list report. Added to this we give you the
buyer, a full written maintenance report plus our suggestions
and recommendations all in
English. We even oversee the recommendations on your behalf. Cost for this Inspection ranges from 3000 baht for new houses under 2 years old to
6000 baht for a
standard 4-6 bedroom older house, condos 3000 baht as we look at the
entire building ( This does not including away travelling
expenses). eg. cost to inspect in Bangkok is 22,000 baht----takes 2 days
----report printout. We do not conduct land area searches as survey pegs are not
shown. For this you need a surveyor which we can obtain for you. Other buildings like Commercial
properties we can quote you. PLAY IT SAFE-- WHY HAVE A HOUSE THAT WILL
NOT LAST!!!!!! As of Feb 2003 we have managed to assist foreign clients
before they buy with the knowledge that the seller will initiate our
recommendations & saved money for our clients.
[ LEASING
PROPERTY ]
We highly
recommend you obtain a Title search and House Inspection report before
you purchase ANY property in Thailand. Cost 7000 baht
Comprehensive
Title search as well as House Inspection fee starting at 3000 baht.
KITCHENS
& AIR CONDITION INSTALLATIONS:
When buying an existing
home or new house you may want to have a new western style kitchen
installed or maybe air condition units. If we carry out a Housing
Inspection then we also in our report have a free quotation for air
condition units and kitchen joinery for you with FREE installation or
arrange on your behalf. We can help you with the top Kitchen
manufacturers.
[ Go
to Kitchens ]
ARCHITECT:
Ask no further as we use
Khun Da in ChiangMai recommended to us who speaks excellent English and
whom one of our partner's Dr. Harry Gair is presently using. We can
arrange for you as many foreigners use her services.
INSURANCE:
We use the services of Thai Zurich for all
your house insurance. Please just ask us as we are agents for Thai
Zurich in Chiangmai and all over Thailand. Need to know more then ask Thongjan 09-6311114. We
can advise you on all your insurance needs & whether you go through
us or you do yourself there is no difference in the price. However using
our services we make sure you are happy before you even have to pay any
more------- no hidden agendas as we are safe. [ See
more on insurance ]
WHY USE OUR SERVICES:
 | We work for you (Both Thai &
foreign consultants ) |
| No hidden charges-everything is up
front. |
| Guaranteed conveyancy help &
Company, work permit & land setup for foreigners |
| We will sell your Commercial property,
houses, businesses, bars and Guest Houses |
| Because you have the benefit of
foreign help with our Thai lawyers and expat consultants |
| We offer: Full
house onsite appraisals. Cost is 3000 baht for a house under 2 years
old & 6000 baht for older houses ( plus travel if out of town ). This 5-6 page report
is a must if you want to know what your house is really like which
includes pics of repair work needed and we even do a air con survey
(extra). |
| We now conduct
outhouse consultation at your Hotel if you require assistance with
any Business ideas or housing advice with our foreign consultant.
Cost is 1000 baht |
BUYING
A BUSINESS:
Thailand differs from
every other country and when you decide to buy a service or hospitality
business here the first and most foremost thing you do is ascertain who
your management structure will be. The location is second to this and if
you do not have your management sorted out first then you will find it hard to make
headway in Thailand eg. honesty. [ SEE MORE ON
BUYING A BUSINESS ]
FREIGHT
FORWARDER FOR YOUR HOUSEHOLD GOODS:
Thailand can offer many
foreigners moving household belongings to and from Thailand. If you need
to ask then check out [ FREIGHT
FORWARD COMPANIES ]
If
you have a property to rent, sell or lease in Thailand then WRITE TO US
as we can advertise for you in our hardcopy news in Chiangmai .
