No, but please keep in mind that your rental contract should correspond to the length of your visa. Don’t sign a 1 year contract if you’re not sure you can stay in Thailand for this period as you might not be able to get your deposit back.
Frequently Asked Questions About Real Estate In Thailand
Buying Property in Thailand
General
Yes, foreigners can buy property in Thailand, subject to certain restrictions.
Foreigners cannot own land in Thailand, but they can own buildings and condominium units (under the foreign quota).Â
In buildings categorized as condominiums, developers have the permission to sell a maximum of 49% of the total apartments to foreigners as freehold properties. The remaining 51% must be sold to either Thai citizens or Thai companies, with foreigners being allowed to own a maximum of 49% of the shares. As a result, you will notice varying prices or payment terms for each project, depending on whether the apartment is being purchased under ‘Foreign Ownership’ or ‘Thai Company Ownership’.
Regarding houses and land, foreigners can either lease land for up to 30 years, with an option to renew for an additional 30 years, or consider purchasing through a Thai company. If you want to purchase land or a house there are many ways to secure your investment. We can also arrange safe solutions for you to purchase your home. Contact us to find out more.
Yes, it is possible to purchase property in Thailand through a Thai company, but it is important to comply with local laws and regulations.
Thai company ownership is not considered the most favorable type of ownership due to the requirement of having 51% Thai shareholders, which means you won’t be the sole owner of the property. However, if you are willing to accept these conditions, it is a common practice among foreigners in Thailand. Many foreigners have been using this method for several decades.
Nevertheless, it is crucial to engage an independent lawyer to ensure that the company established to hold the property is set up correctly. This is done to grant the foreign buyer complete control over the company and its assets, including the property. If the idea of Thai company ownership doesn’t appeal to you, we recommend focusing on condominiums that offer 100% foreign name ownership. This provides a more secure investment option.
The taxes associated with buying property in Thailand include a transfer fee, a specific business tax, and a stamp duty.
For off-plan property acquisitions, there are three taxes imposed by the Land Department upon registering the property in your name. These include a Transfer Fee of 2%, a Special Business Tax of 3.3%, and a Stamp Duty of 0.5%. It’s important to note that some taxes are calculated based on the “selling price,” while others are based on the “appraised price,” which is typically lower than the selling price. In total, these taxes amount to approximately 6.3%. The responsibility for paying these taxes is divided between the buyer and the seller.
The specific tax distribution may vary depending on the major developer as each one has their own approach. Consequently, the actual taxes paid by the buyer can range from a minimum of 1% to a maximum of 6.3%, depending on the particular development. In the case of a private sale, the tax split is subject to negotiation.
Once you have completed the property purchase, there are no annual property taxes to be paid in Thailand, unless you decide to lease out your property. The only additional costs following the purchase will be the maintenance fees for the building’s upkeep and the payment for utilities such as water and electricity that you utilize.
It is not a legal requirement to hire a lawyer to buy property in Thailand, but it is recommended to seek the advice of a lawyer to ensure that all legal requirements are met.
It is recommended to conduct a thorough due diligence process before buying a property in Thailand, which includes a title search and a check for any legal issues or disputes.
The process of buying a property in Thailand typically involves finding a property you want to buy, negotiating the price, signing a sales agreement, paying a deposit, and then completing the purchase.
After identifying a property you wish to purchase, the next step involves completing a straightforward reservation form and submitting a reservation fee, typically around 50,000 THB. Subsequently, you will receive the contract for your review and signature. If you are satisfied with the contract’s terms, you should sign and return a copy, along with the contract deposit payment.
In the case of purchasing an “off-plan” property, the contract deposit generally ranges between 20% to 30%. Throughout the property’s construction period, you will be required to make interim payments at regular intervals. The specific payment structure for these interim payments varies depending on the developer you are dealing with. Once the property is completed, you will be responsible for settling the remaining balance of the purchase price upon receiving the key to your new home. Additionally, upon completion, you will need to pay the applicable taxes when the apartment is registered in your name at the Land Department.
For the purchase of a completed property, the full amount is typically required within 30 days from the reservation date, although some sellers may be open to negotiations.
There are no residency requirements for buying property in Thailand, but it is recommended to consult with a local lawyer or property expert to ensure that all legal requirements are met.
Purchasing Condos
Foreigners can own up to 49% of the total floor area of a condominium building in Thailand, with the remaining 51% reserved for Thai nationals or Thai companies.
A “Sinking Fund” refers to a one-time payment designated as an emergency fund to cover any future unexpected repairs or improvements required for the development (e.g., repainting the exterior every few years). The payment for the Sinking Fund is typically due upon the buyer receiving the apartment. The cost of the Sinking Fund is determined based on the apartment’s size and is quoted per square meter.
On the other hand, “Maintenance Fees” are recurring payments necessary for the day-to-day operation and upkeep of the project (e.g., salaries for security, receptionists, and cleaners; maintenance of swimming pools; electricity for lifts, etc.). Similar to the Sinking Fund, the Maintenance Fee is calculated based on the square meter area of each apartment, and the price quoted represents the monthly fee. In most cases, developers require the full year’s payment of maintenance fees in advance once the apartment is handed over. Subsequently, the fees are to be paid annually in advance.
Please note that the specific terms and requirements for Sinking Funds and Maintenance Fees may vary depending on the development and the developer’s policies.
When purchasing an apartment under foreign ownership, it is a requirement that all funds and payments originate from outside of Thailand. Many buyers choose to send payments from their bank accounts in their home country through international wire transfers directly to the developer’s or private owner’s account. The currency used for the funds does not matter, except for Thai Baht, as it will be converted to Thai Baht upon arrival in the country. Once the receiving bank in Thailand receives the funds, a “Foreign Exchange Certificate” will be issued by the bank. This certificate is necessary for the land office to register the property in your name.
Alternatively, foreigners also have the option to open bank accounts in Thailand. If you prefer to deposit funds into a Thai bank account first, you will need to arrange for the bank to provide you with the “Foreign Exchange Certificate.” This certificate serves as proof that the funds originated from outside the country and are intended for the purchase of real estate.
Selling Property in Thailand
The costs associated with selling property in Thailand include agent fees, taxes, and transfer fees.
The length of time it takes to sell a property in Thailand depends on various factors, such as the location, condition, and price of the property, as well as market conditions.
The typical commission rate for property agents in Thailand is around 3-7% of the sale price depending on location, type of property, agency exclusivity, and other included services in an agency agreement. Standard fee is 5% in Chiang Mai.
Renting Property in Thailand
Generally two months deposit and the first month’s rent is paid upon signing a contract.
Generally about 30-45 days after you’ve returned the property, provided you’ve fulfilled the requirements of the contract during the lease period. It’s possible that there may be some deductions, for example, if your last utilities bills are not paid, if there is damage to the property, if the property has not been cleaned, etc.
These are monthly fees (sometimes paid yearly) to the management of the condo or moo baans (compounds/ housing estates) to maintain the public areas of the condo or community. These are generally paid by the tenants, but are sometimes included in the rental and should be specified in the lease agreement.
Generally, tenants pay directly into the owner’s bank accounts. Please keep the deposit slip as proof of payment.
Garbage
In some cases the garbage service is included in the common fee, but some cases it is a separate monthly/yearly bill that is generally paid to the neighborhood office.
Alternatively in some areas you pay for the village garbage bags with their logo at a set price per bag and all trash that is set out on the appointed days will be collected.
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Water & Electricity
For electricity and water bills you can pay at 7-11 stores or direct at the utility offices. If the house owner has auto-payment set up on their account, you will need to send the amount on the monthly electricity and/or bill along with your rent to the owner.
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Internet
You can choose an internet provider of your choice that services the area you are in. Most providers have phone apps and you can use to pay them, or bank auto-deduct may also be able to be set up with them directly.
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Propane Cooking Fuel
Propane for gas stoves are sold in various tank sizes and whenever you need a refill, your local propane tank supplier will deliver a new tank for you and you can pay them directly.
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Renting out Your Property
Yes, it is possible to rent out your property in Thailand, but it is important to comply with local rental laws and regulations.
Agency Services
General
Generally the seller or landlord pays the agent fees.
Help Finding A Property
Yes, we do and there are no extra fees required. We do ask however that you commit to us for at least a reasonable amount of time. We know you hate filling out forms, but In order to best serve you it is important to start the process by filling out the appropriate quick rental or purchase form on our contact page so that we have all your criteria.
Agency Services For Selling Or Renting My Property Out
Our business model is to take a percentage of the sale/rental price when your property sells or is rented out. We do not charge up front fees except in the case of additional services required such as 360 tours and videos as these require additional upfront expenses and time on our part.
Generally we only offer agency services on an exclusive/sole agency contract so that we can better manage our listings and offer a higher level of service and exposure for your property.
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Standard Agency Service:
– Rental – New tenant placement – 1 month rent for a 1 year lease. For additional years on a lease an additional fee of 1/2 month for each year. Contract renewals are also 1/2 month’s rent.
– Sales – 5% of the sale price once the property sells.
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Property Management Services:
Contact for details.
First impressions are important, so in order to make your listings as attractive as possible we need to get great photos, and in some cases, 360 tours, and videos. For us to do this, your responsibility as the owner is to prepare your property to be as close to “showroom” condition inside and out before we come out to take photos.
Once we have great media, we can start the advertising process.Â
In addition to our website and social media channels, we will also advertise your property on the following:
– All the major real estate classified sites in Thailand. Contact us for a full list.
– Non-real estate exclusive marketplaces and classified sites.
– Posting on hundreds of Facebook Chiang Mai real estate groups.
– Sharing with co-brokering sites and other local agencies.
– Additional paid advertising campaigns on various social media platforms.
Because there are so many factors, many of which are out of our control, we can not give a definitive timeline. However, we work hard to give your property as much exposure as possible. One of the main deterrents to an expedited sale/rent is the pricing, so it is important to be realistic about what you can ask for it.