- Process of buying on the secondary market, Timeline to buy
Purchasing: The Process
Step 1 – Agreement of terms and conditions
Ensure all parties understand and agree the major terms and conditions of the transaction such as: The purchase price: …………………………………………………………….. 5% Reservation deposit value that will remove the property from the open market, the reservation deposit is fully refundable, Subject to Failure of the Developer to deliver. Included in the purchase price: Furniture: NO or YES . Taxes and transfer fees: YES, What will be the completion date for transfer of ownership?
Step 2 – Sales and Purchase Agreement
Typically you will have 30 days to review the terms and conditions of the Sales and Purchase Agreement which contractually outlines the conditions of sale. During this period, buyers have the option to appoint an attorney in order to conduct a legal due diligence on the contract, and land title deed.
Step 3 – Settlement & Transfer
Parties to the transaction (or their representatives – agent/lawyer) will set a transfer date at the government land department. The buyer will prepare funds for the balance of the purchase (minus deposit) and the seller will present the original ownership documents to facilitate the transfer. It is common for the buyer, seller or even both parties to appoint a representative through a Power of Attorney to execute the transfer on their behalf. The mechanism of transfer at the Land Department (handover over ownership and payment) can either be through telegraphic transfer (typically to a legal representatives account) at which point a cashiers cheque will be drafted and presented by the buyer or their representative once the property has been officially transferred.
Purchasing: The Process
Step 1 – Unit selection and agreement of terms and conditions, Ensure all parties understand and agree the major terms and conditions of the transaction such as:
Step 2 – The purchase price: Reservation deposit: 100,000 THB, the reservation deposit is fully refundable
Included in the purchase price: List of Furniture or Fittings. Taxes and transfer fees –
Step 3. Payment schedule:
30% Deposit: upon the Delivery of the land to buyers name
20% First Instalment: Finishing Foundations and Register Building Permission to Buyers Name.
15% Second Instalment: Finishing walls & roof Structure
15% Third Installment: Finishing Pool Structure
10% Fourth Installment: Finish all Installations, Windows / Doors/Electric & Water System
10% Fifth Instalment: Hand over, Connect electric and water supply to the house
Step 4 – Snag List
Two to three weeks prior to handover a snag list will be created to correct any defects in the property prior to handover.
Step 5 – Transfer when the build is finished the Developer will serve a notice to complete. You’ll pay the rest of the purchase amount and the property is yours. You are not required to be in Thailand to complete the handover process. This can be executed by a 3rd party on your behalf.
How foreigners can own A property In Thailand
- Foreigners cannot buy land in Thailand,
- Foreigners can buy Free Hold 100% a whole building, minus the land on which it is built.
In recent years, minor changes in Thai law have allowed nonresidents to explore the Thai real estate market. A foreigner can have a 30-year renewable lease, under which the buyer registers at the Land Office an option to renew the lease contract indefinitely, for further 30-year periods.
Our Suggestions to our Buyers:
- If a Foreigner have a Thai spouse: transfer the land to Her/his Name,
- Lease the land from your spouse (taxes are 1% of the rental value for 30 years, Very Low)
- Buy or Register the Building permission in the foreigner name (foreigners can own Buildings 100%)
Another option is to set up a private limited company with mixed Thai and foreign ownership, the foreign ownership being 49% or less. Companies are allowed to own land. The foreign national can control the company by using a legal power of attorney from the Thai shareholders, handing control to the foreign directors, or through assigning greater voting rights to the foreigner partner/s. This is an effective and time-tested route, most commonly taken by foreigners. The help of a lawyer is very important. You Must Be aware Thai Nominees are not legal In Thailand
Foreigners can also invest at least THB40 million (US$1,142,857) in a Board of Investment approved project. They will then be allowed to purchase up to 1 Rai (1,600 square meters) of land.