For those considering buying property in Thailand, there are a number of options available. There are properties to suit every budget with new real estate projects being announced on a daily basis. There are a number of factors that make Thailand an attractive place for investors, retirees or people just looking to buy a holiday home. Despite the appreciation of the Thai currency, property in Thailand can still be purchased at a very reasonable price compared to western standards.
The Purchasing Process
An offer on a property in Thailand should not be made unless the prospective buyer has received legal advice. A person should only ever hand over any money when they have been given the go ahead by a solicitor.
When a person is in a position to go ahead with the purchase of a property in Thailand they should make sure that the name in which the property has been purchased matches the name on their passport. This can help avoid any complications further down the road. Normally, a 10% deposit is required before the full purchase agreement is completed.
A preliminary contract will be drawn up containing a date when the final contract will be signed. On this date the buyer will have to pay the outstanding balance and any other taxes that are due. The Land Department will also be made aware of the purchase.
Regulations mean that foreigners in Thailand can own actual bricks and mortar, but not land. This means that most foreigners buying property in Thailand will opt to buy a condominium. This makes matters less complicated, but if a person really does want to buy a house or villa there are ways to do so. A person could set up a Thai limited company in name, owning 39% of the shares with the remaining shares owned by Thai nationals that can be transferred later to the buyer. Another way is to lease land. This will be for 30 years with an option to renew the lease twice so really it’s a 90 year lease. Marrying a Thai is another option.
Acquiring finance for a property in Thailand can be difficult for a foreigner so most people will arrange this in their home country and then transfer the money to a Thai bank account. This means that buyers do not have to consider currency fluctuations.
Fees and Taxes
An estate agent will usually take around 3% of the total purchase price. When compiling a budget include a transfer fee of 2%, 0.5 % stamp duty and solicitor’s fees of 1%. The good news for the buyer is that there is no capital gains tax.
If a person has set up a Thai company to purchase a property in Thailand a 3.3% business tax will have to be paid.
With so many property developments being announced there are many options for those looking to buy a property in Thailand. Buyers should aim to purchase from a well-established developer, and a reputable solicitor should always be used.
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