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**Sundance2020** · 10-29-2021, 05:25 AM

Buying a Condo in Thailand | PART II

When a Foreigner has to give up his Ownership

Section 19 (5) The alien or juristic person as provided in Section 19 shall dispose of apartment in the following cases:

When the alien or juristic person stipulated in Section 19 have acquired apartments by legacy in the capacity of statutory heir or inheritor under will or by other means as the case may be, and when include the apartment already held by such aliens or juristic persons stipulated in Section 19 exceeding the ratio prescribed in Section 19 bis;
Where the permission to have residence in the Kingdom of the alien as specified in Section 19 is revoked, or his residence certificate is no longer valid;
Where the alien as specified in Section 19 (1), (2) and (5) is deported out of the Kingdom, and has not received a relaxation or is not sent to earn a living any where instead of being deported;
Where the alien as specified in Section 19 (4) does not receive permission from the Board of Investment to stay in the Kingdom;
Where the promotion certificate of the juristic person as specified in Section 19 (4) is revoked.

The alien or juristic person who is compelled to dispose of the apartment under the first paragraph shall notify in writing the Competent Official within the period of sixty days from the date the cause of such disposition occurred under the first paragraph.

For the case of (1), only the apartments exceeding the designated proportion shall be disposed; for the case of (2), (3), (4) and (5), all the apartments owned shall be disposed.

The disposition of apartments under the third paragraph shall be made within a period of not exceeding one year from the date of acquisition of ownership of such apartments, or the date of revocation of permission to have residence in the Kingdom, or the invalidation of the residence certificate or the date of being ordered deported or the date of revocation by the Board of Investment of permission to stay in the Kingdom, or the date of revocation of promotion certificate as the case may be. If the disposition is not made within the said period, the Director-General of Land Department shall have the power to dispose of such apartment, and the provisions regarding the the compulsion of disposition of land under Chapter 3 of the Land Code and the Ministerial Regulations issued there-under shall be applied to the disposition of such apartment mutatis mutandis.

Section 19 sex (6) Where the authorized official issues an order to revoke the permission for aliens to have residence in the Kingdom, or where the facts appear to the official that the residence certificate of the alien is no longer valid for the alien as specified in Section 19 (1), (2) or (5) out of the Kingdom, or issues an order revoking the permission for the alien as specified in Section 19 (2) for staying in the Kingdom, or issues an order revoking promotion certificate for the juristic person as specified in Section 19 (4), as the case may be, such official shall notify the Director-General of the Land Department within sixty days from the date of issue of the order or the date of knowing such facts.

Inheritance of Foreign Ownership

Section 19 septem (7). An alien or juristic person regarded by law as alien other than those specified in Section 19 who acquires an apartment by inheritance as statutory heir or legatee or otherwise, as such case may be, shall notify in writing the Competent Official within a period of sixty days from the date of acquisition of ownership of apartment, and shall dispose of such apartment within a period of not exceeding one year from the date of acquisition of ownership of apartment. If disposition is not made within said period, the provisions of the fourth paragraph of Section 19 quinque shall apply mutatis mutandis.

Ownership and change of Thai to Foreign Nationality

Section 19 octo (8) Any person who acquired ownership of apartment while he had the Thai nationality, and subsequently loses Thai nationality due to surrender of Thai nationality, conversion of nationality or revocation of Thai nationality under national law, and is not alien as specified in Section 19, shall notify in writing the Competent Official of loss of Thai nationality and the inability to continue to hold ownership of apartment within a period of sixty days from the date of loss of Thai nationality, and shall dispose of all apartments owned by him within a period of not exceeding one year from the date of loss of Thai nationality. If disposition is not made within said period, the provisions of the fourth paragraph of Section 19 quinque shall apply mutatis mutandis.

Section 19 novem (9) Whoever acquires the ownership in apartments at the time he is of Thai national, if later the said person loses his Thai nationality because of forsaking Thai nationality, denationalization or having been denationalized of Thai nationality under the law governing nationality, and the said person is an alien as stipulated in Section 19, if wishing to continue holding the ownership thereof, shall inform the competent authority in writing of the lose of Thai nationality and shall produce evidence that he is an alien stipulated in Section 19 to the competent authority within one hundred and eighty days from the date of loss of Thai nationality. However, if the ownership in apartment of the said alien exceeding the ration prescribed in the first paragraph of Section 19 bis, or not being in accordance with second paragraph of the third paragraph of Section 19 bis, he shall dispose of the apartment that exceeds the ratio within one year from the date of loss of Thai nationality. If he does not dispose of the said apartment within the said period of time, the provisions of the forth paragraph of Section 19 quinque shall apply mutatis mutandis.

If the alien under the first paragraph does not wish to continue to hold ownership of apartment, he shall notify in writing the Competent Official of the loss of Thai nationality within a period of sixty days from the date of loss of Thai nationality, and shall dispose of all apartments owned by him within a period of not exceeding one year from the date of loss of Thai nationality. If disposition is not made within the said period, the provisions of the fourth paragraph of Section 19 quinque shall apply mutatis mtandis.

Section 19 decem (10) A juristic person which had Thai nationality and holds ownership of apartment, and subsequently the nature of such juristic person changes to become that regarded by law as an alien and is not a juristic person specified in Section 19, shall notify in writing the Competent Official of change of its nature and the inability to continue to hold ownership of apartment within a period of sixty days from the date of such change and shall dispose of all the apartments owned by it within a period of not exceeding one year from the date of such change. If disposition is not made within the said period, the provisions of the fourth paragraph of Section 19 quinque shall apply mutatis mutandis.

Section 19 undecim (11) For juristic persons which is of Thai nationality and holds ownership of apartment, and subsequently the nature of such juristic person changes to become that regarded by law as an alien and may hold ownership of apartment as it is a juristic person as specified in Section 19, if it wishes to continue to hold ownership of apartment, it shall notify in writing the Competent Official of change of its nature shall submit evidences showing that it is an alien as specified in Section 19 to the Competent Official within one hundred and eighty days from the date of change. But if the ownership of apartments of such juristic person exceeds the proportion specified in Section 19 bis, it shall dispose of the apartments in excess of the proportion prescribed within a period of not exceeding one year from the date of such change. If disposition is not made within the said period, the provisions of the fourth paragraph of Section 19 quinque shall apply mutatis mutandis.

If the juristic person under the first paragraph doe not wish to continue to hold ownership of apartment, it shall notify in writing the Competent Official of change of its nature within a period of sixty days from the date of such change and shall dispose of all apartment owned by it within a period of not exceeding one year from the date of such change. If disposition is not made within the said period, the provisions of the fourth paragraph of Section 19 quinque shall apply mutatis mutandis.

Can ownership of a condo be passed on to my children?

The right of foreign ownership of a condo in Thailand is granted to the individual foreigner and not also to his foreign successors. Any foreigner who receives a condo in Thailand by inheritance or through a gift must again individually qualify for ownership of the condo under section 19 of the Condominium Act, or he must (section 19 under 7) sell the unit within one year of acquisition by inheritance. Ownership can be passed on to foreign heirs, but generally they cannot register ownership and must dispose of the apartment unit within 1 year.

**Sundance2020** · 10-29-2021, 05:26 AM

Buying a Condo in Thailand | PART III

How to Pay for the Condo | The Risks

Price per square meter is one of the key elements to determine the value for money and is the basis to compare affordability of projects in an area. In case of and existing condo the price for the condo usually paid at the time of transfer of the condominium at the land office by cashier's check (a check issued and guaranteed by your bank in Thailand - i.e. the bank that will also issue your foreign exchange documents). In case of an off-the-plan condo the purchase price is usually paid to the developer's bank in Thailand in installments with a final payment at the time of transfer (note importance of escrow arrangements). Payment terms in the contract are negotiable.

Payment Terms when buying Pre-Construction

When an existing condo unit is sold by the owner the purchase price could be paid by cashier's check at the time of completion of transfer of ownership at the land office. A small deposit from the buyer could be asked by the seller at the time of signing the condo sale and purchase agreement. In the case of the sale of an off the plan condominium in Thailand a substantial part of the purchase price is often paid by the buyer to the developer prior to transfer of ownership and prior to completion of the condo or sometimes even before the work has started. The standard payment schedule in off-plan condo projects is:

If any, a reservation agreement with a reservation fee of 100,000 THB
A deposit of 10 to 20% of the total condominium price on the execution date of the condominium sale and purchase agreement
Monthly installments during the construction of the condominium with a final amount upon completion and transfer of ownership of the condominium - refer to the payment schedule within the developer's standard sale contract.

Purchase Price Installments | Escrow Service

Payments during the construction of the condominium are usually made directly into the developer's bank account and not into a third party escrow account protecting the buyers payments. Developers in Thailand do not offer escrow often because they need the ongoing payments for the financing of the project. They are under the 2008 Escrow Act or new 2008 Condominium Act also not required to offer escrow agreements to consumers. In fact escrow arrangements are very uncommon and property developers in Thailand are free to require deposits and installments from consumers without offering any protection or guarantee for these payments (other than contractual obligations under the sale and purchase contract). Obviously this carries some risk for the buyer. When the buyer pays part of the purchase price directly into the developer's bank account he accepts the associated risks and disadvantages:

in the event of default or bankruptcy of the developer the buyer could lose all money paid, and
in any dispute the developer has a much stronger position as he already received a large part of the purchase price. If there is a dispute and the buyer does not make his final payments because the developer did not deliver as promised or delivered a substandard product the developer will say that the buyer defaults by not paying the final payment installments and he will suggest that he is entitled to forfeit the payments made by the buyer and sell the condo to someone else. Something he would not be able to do when the payments were held in a third party escrow account. The buyer could go to court to get his money back but that is in Thailand a frustrating and long route with an uncertain outcome.

Paying in an escrow account means that payments are made to a third party escrow licensed financial institution/ bank (not a law firm), that will hold the deposited monies till the conditions of the (condominium) sale and purchase agreement have been met. The use of escrow services offers greater security for consumers but are not common practice in Thailand.

Payments to a Property Developer's Company

Paying a large part of the purchase price to the developer prior to completion and delivery is not recommended in Thailand. The situation could be slightly different if the developer is a reputable (maybe SET listed) property developer with a substantial share capital or a local limited liability company (e.g. a 5 million baht share capital company running a 100 Million THB development). There are obviously greater risks with a local developer running a property development through an under-capitalized limited liability company, especially if he has no or maybe a poor track record. Note: if payments are made to the developer (foreign currency held in escrow is released) the developer is responsible for the issuance of foreign exchange documents required for registration of foreign condominium ownership registration FET Form.

Especially expensive tourist condos do not easily sell in the current market. The most common problems buyers face are:

The developer goes bust and the project partially completed
The condominium turns out to be offered as a leasehold
Substandard quality of the built
Late completion
General default on various terms
Sale Agreement | Thailand Law Online
Escrow Service Sample in Thailand

Transfering of Foreign Currency into Thailand

The FET - Foreign Exchange Transaction Form (previously and for some still known as Thor Tor 3) is the official document prepared under BOT - Bank of Thailand regulations to report foreign currency exchange transactions in Thailand and the document also proofs the remittance of foreign currency into Thailand and the exchange of foreign currency into Thai Baht inside Thailand. The FETis issued by the authorized financial institution (the Bank) inside Thailand that handled the exchange of foreign currency and contains at least the following information:

The transferred amount in foreign currency,
The transferred amount in Thai Baht,
The name of money sender,
The name of money receiver,
The purpose of transferring the money

For any foreign exchange transactions (buying, selling, depositing, withdrawing foreign currencies) between financial institutions and their non-interbank customers the recipient bank inside Thailand must prepare a FET form for each remittance and exchange of foreign currency with an equivalent of USD 50,000 or more and report this to the Bank of Thailand.

One of the requirements for foreign ownership under the Thailand Condominium Act (section 19) is that a foreigner has remitted into Thailand the full purchase price of the condo in foreign currency. The handling bank in Thailand must upon request issue an official copy of the FET - Form or a prepare credit note and bank letter of guarantee containing the same information as the foreign currency exchange transaction reporting form as proof of the remittance and exchange of foreign currency into Thai Baht by the foreigner. These documents must be handed over to the land office in order to register the transfer of ownership of a condo apartment unit in the name of the foreigner. The foreign exchange transaction documents must show the foreign purchaser's name either as the sender or receiver of the money from the overseas bank. If the remittance from abroad is in Thai Baht the bank will not issue a FET - Form and the foreigner will not qualify for registration of foreign ownership at the land office, unless he qualifies on one of the other grounds for foreign ownership under section 19 of the Condominium Act.

Return Transfer of Funds | Repatriating Funds to a Foreign Country

The banks in Thailand have to follow strict regulations. As a result, it can be quite difficult to repatriate funds if you do not have the correct paperwork. To repatriate the sale proceeds of the sale of a condo the bank will ask for a copy of the official land office sale agreement (with Garuda symbol) and land officetax receipt, a copy of the title deed of the condominium unit, passport copy and a copy of the FET - Form (or the previously used Thor Tor 3 form) which the foreigner obtained when they remitted money into Thailand to buy the condominium. If these documents are supplied the bank will allow transfer of the money out of Thailand without additional deductions. When selling the condominium personal income withholding tax is taken as part of the transfer taxes. The land office will issue a tax receipt for payment. Withholding tax is calculated based on the years of ownership.

**Sundance2020** · 12-16-2021, 01:18 PM

Buying a Condo in Thailand | PART IV

Financing and Mortgage for the Condominium ?

Normal mortgage financing from a Thai bank for the purchase of a condo is generally not an option for foreigners in Thailand. Basically only foreigners with residency, income and an employment history in Thailand can, depending on the bank's policy, obtain a mortgage for the (part) financing of a freehold condo (and then only for a real condo as this is the only immovable property foreigners can obtain outright ownership of in Thailand). But even if the foreigner meets the criteria Thai banks are generally reluctant to lend money to foreigners. Banks will not give a mortgage for a condo to non-resident foreigners. Foreigners can also not register ownership without having complied with the Condominium Act section 19 which usually means having transferred foreign currency into Thailand for the purchase of the condo. If the foreigner is married to a Thai national the bank's requirement could be that the condo is registered as a personal property of the Thai spouse where the foreigner is merely the guarantor of the loan without ownership rights in the condo.

Saleable floor area?

The apartment price in the contract for a not yet completed condominium is based on the size of the condo according to the plans of the building with a price adjustment based on the final size of the unit. Sale-able area in the sale contract means the area on which the contract price is based, and registered area (upon which the final price is based) means the exact floor area upon completion of the condo as measured by the Land Department surveyor. The final size of the unit mentioned in the unit title deed could be significantly larger than the size mentioned in the contract which is based on the building plans. A maximum price adjustments should be agreed in the sale and purchase contract for the condo.

Other documents

When buying an existing or re-sale condo the seller must supply a letter of guarantee issued by the condominium juristic person that the condo unit falls within the 49% foreign ownership quota of the condominium and a letter that there are no outstanding fees for the unit to the condominium juristic person. Other documents required at the transfer are among others the ID-cards or passports, a marriage or divorce certificate (if applicable), a land office Tor Dor 21 (form Or Chor 21 for condominium) power of attorney if you are not going to the land office yourself for the transfer of ownership, check guaranteed by a bank for payment of the balance of the purchase price to the seller (if applicable) and cash to cover the transfer fees and taxed.

**Sundance2020** · 12-16-2021, 01:33 PM

Buying a Condo in Thailand | PART V

Can I rent out a Condominium and do I have to Pay Tax?

If it is one unit and occasionally rented out then in practice this would not lead to any problems unless this activity is restricted in the bylaws of your condominium. With the popularity of lodging reservation websites (like AirB&B) more and more condominiums include rental restriction in their internal rules and regulations. Putting a unit to commercial use (repeated short term rentals up to 30 days) may need compliance with the Hotel Act even if an exemption applies for a single owner. If the rental activities are considered operating a business in Thailand by a foreign investor the foreign owner could also be restricted by the Foreign Business Act and possible Foreign Employment

Act.A Non-Resident individual (foreigner in Thailand) is subject to tax only on assessable income from Thai sources, regardless of payment location. Rental income is subject to personal income tax (Revenue Code section 40 under 5) and over properties put to commercial use or rented out by the owner 'housing and land tax' must be paid.

When I sell my condo do I have to Pay Taxes ?

When you sell your condo taxes must be and are paid at the Land Office at the time of transfer. This includes transfer fee, business tax or stamp duty and income withholding tax. With the land office tax-receipt, sale documents and documents confirming the previous transfer of foreign currency into Thailand, the bank is allowed to transfer the full amount received from the sale of a condominium by a foreigner out of Thailand without any deductions.

What are the Transfer Fees and Taxes ?

There are a variety of taxes and fees involved when transferring a condominium unit in Thailand; transfer fee, stamp duty, withholding tax (personal or corporate) and specific business tax (if applicable). How these costs are divided between the buyer and seller in a re-sale depends on what is agreed in the sale and purchase agreement and can vary from buyer pays all to seller pays all. When buying in a condominium development the seller (developer) can under consumer protection laws only pass on up to half of the 2% ownership registration (transfer fee) to the buyer The government program to stimulate condominium sales business by reducing the transfer tax and fees ended in 2010 .

What is a Condominium unit Title Deed ?

Each apartment unit in a condominium building has an ownership title deed issued by the Land Department. The title deed must among others contain the following information: 1 - position and location of the land and area of the land of the condominium 2 - position and location, area and plan of the apartment showing the width, length and height 3 - ratio of ownership of common property (ratio of voting rights) 4 - name and surname of the person having the ownership of the apartment 5 - index for the registration of rights and juristic acts (if there is for example a mortgage registered it will show on the backside of the title deed and should be removed prior to the transfer of ownership) 6 - signature, position and seal of the Competent Official. Transfer of ownership of a condominium and amendment on the title deed always takes place at the land department.

Sale and Purchase Agreement ?

The sale and purchase agreement for a condominium specifies in detail the responsibilities of the buyer and seller of the condominium. A sale and purchase agreement covers among others the agreed price and payment schedule, transfer date, exact details of the condominium, responsibilities for transfer fees and taxes, warranties and matters relating to due diligence. A sale and purchase agreement with a developer in a condo development is a contract controlled business (not the leasehold sale agreement), and the standard sale contracts must comply with the condominium act and consumer protection laws. For a re-sale of an existing condominium the parties do not have to make a sale and purchase agreement but making a sale and purchase and specifying in detail the responsibilities of the buyer and seller is strongly recommended. Transfer of ownership takes place at the provincial or local Land Department's branch office and at the time of transfer a second official Thai script land office sale agreement is signed and transfer fees and taxes must be paid.

Tabien Baan - Yellow or Blue Thai House Book

What is a Tabien Baan or Thai House Book?

Tabien baan or Thai house book is the official local government issued house or apartment address and resident registration booklet. It is an administrative document issued by the local municipality (amphur). The persons having their domicile or legal residence at the house or condo unit are registered in the house book.

Contrary to what is often assumed by foreigners this document has nothing to do with ownership of a house or condo and cannot be used as proof of ownership. It is a booklet issued by the local municipality (not the land department) that belongs to the official address registration papers of a home or condo and its practical use is that it registers and proves a persons place of legal residence (official domicile). A house book could state the name of the owner but in the case of a foreign non-resident owner not (unless he has official residency in Thailand).

Thailand has 2 types of House Books (with a Blue or Yellow Cover):

The Blue Tabien Baan or blue house book (Thor.Ror.14) for Thai nationals, and;
The Yellow Tabien Baan or yellow house book (Thor.Ror.13) for foreigners.

As a house book proves a person's domicile it is asked in official registration procedures such as the transfer of ownership of a car or real estate, opening a bank account or when applying for a new electricity or telephone line connection and gives for example Thais the right to vote in a district. As foreigners are usually not registered in a Thai house book foreigners with a non-immigrant visa can where proof of address is required alternatively show a letter of residence issued by the local immigration office, or when he is the owner a condominium unit title deed in combination with the (empty) blue tabien baan and his passport.

In case of a foreigner owns a house (separate from the land) or condominium the blue house book is usually empty, unless he has Thai nationals living with him who have their
permanent home at this address

House Book Application

A house book can be issued for a house, condominium apartment (whether registered under the Condominium Act or not). The official house book for Thais is the blue book and for foreigners residents a yellow book. A blue book is standard issued but in case of a foreigner it can be exchanged for a yellow book if the foreigner meets specific criteria. The documents required for the exchange of a blue book of a completed house or condominium for a yellow book could, besides the application form, could include :

(the list below is a sample list of documents that could be required in the application of a yellow book, but note that each amphur district office has their own requirements therefore always check with them first what documents they require)

A non-immigrant visa
Copy passport with (official) translation
Work permit
Marriage certificate
Apartment unit title deed (condo unit)
Documents relating to the land and right to use and possess the land (consent land owner)
The official land office sale of a structure document
Building permit.

The blue or yellow tabien baan is not an important document for foreigners and most foreigners owning a condominium or a house (separate from the land) will have a (empty) blue house registration book and not a yellow book. The legal value for foreigners is very limited and generally there is no need or requirement to exchange a blue tabien baan for a yellow tabien baan. A yellow book does not confer any additional rights. However, foreigners married to a Thai national living in Thailand should have their name in the house book of the marital home. For Thais a house book's primary function is that it states his or her place of legal residence (permanent home).

**Sundance2020** · 12-16-2021, 01:35 PM

Buying a Condo in Thailand | FAQ

What is the House Book in a Condominium ?
A house book or blue book or Ta Bien Baan is a residential address registration book issued by the local government municipality. It states the location and apartment address and registers the Thai persons having their legal residence (domicile) at the address. For foreigners a house book (tabien baan) is not an important document and is less relevant as it is not an ownership document but merely a house and resident registration document, and, unless a foreigner is a resident in Thailand, he is not registered in the (blue) house book. In official registration procedures foreigners can use a letter of residence issued by the local immigration to proof their address in Thailand or the owner of the condo registered on the condo title deed can use the (empty) blue book together with the condominium ownership title to proof his residential address in Thailand.
What is the Thailand Condominium Act ?
For further detailed information please refer to: The Thailand Condominium Act
How are Condominiums Managed ?
Condominiums are regulated by 1 - its rules and regulations and 2 - the Thailand Condominium Act. The Condominium Act specifies for example the procedure and requirements for a multi unit apartment building to be licensed as a condominium. The internal regulations (set of Bylaws) of a condominium for example regulate how the building is run (e.g that the units cannot be used as a business or company address, rental restrictions and matters relating pets). The rules and regulations of the condominium are amended by voting of the unit owners in the condominium annual general meetings.
What are Condo Fees ?
Every condominium must be maintained and managed and for this each owner pays condo fees which are based on the square meters of each apartment (section 18 of the Condominium Act). The fees and expenses of juristic condominium are paid in advance according to the condominium regulations and/or according to a special resolution of the General Meeting. Condo maintenance fees are charged monthly or every two monthly or with longer intervals and are each owner's share in the common expenses and maintenance of the condominium. Condos can also have a special reserve fund for repairs and upgrades of the building. Condo management and management fees, the size of the reserve fund (sinking fund) and possible future major repairs could be an additional financial burden to consider before buying a condo.
The Condo Manager and Condominium Meetings
Every condominium shall have at least one manager who is appointed in the general meetings of the joint owners. Learn more about the responsibilities of the condominium manager, the condominium committee, procedure for meetings and expenses of the condominium in the condominium handbook.
The new 51% and 49% Condominium Rules
51% of the available condominiums must be owned by Thais, whereas the remaining 49% may be owned by foreigners.
For more information please refer to: The New Thailand Codominium Act
Can all foreign nationals buy a condo in Thailand ?
There are no restrictions on nationality and every foreigner who can enter Thailand legally (there are no visa-class requirements) can buy and own a condo unit within the foreign ownership quota of the condominium, but every foreigner must personally qualify for ownership under section 19 of the Condominium Act. Usually this means that the purchase price for the condo must have been transferred into Thailand as foreign currency and exchanged into Thai baht by a licensed financial institution inside Thailand. Foreign ownership and the foreign ownership quota is governed in the Condominium Act by section 19
Can a Thai Company own a Condominium unit on my behalf ?
Since the initial 2006 Land Office regulations issued by the Land Department and Ministry of Interior preventing the misuse of Thai nominee shareholders by foreigners and a serie of new regulations this practice in less common. A company set up to circumvent foreign ownership restrictions (buying a condo in the Thai side of the condominium) and dormant holding companies are not allowed under Thai law. Even though generally considered illegal this structure is often still pushed to sell the remaining units to foreigners in the Thai side of expensive condos in the tourist resort areas of Thailand.
What are the property taxes in Thailand ?
There are no general property taxes in Thailand. There is a very low local maintenance tax, with as tax object land and a land and house tax. Land and house tax will not apply to owner occupied properties (condo or house). There are approved plans to introduce a more general (yearly) property tax for land, land and house or condominium apartment with a tax rate of 0,1 % of the appraised value (government assessed value) if the unit is used for residential purposes and a higher rate if put to commercial use.

**Sundance2020** · 01-14-2022, 04:50 PM

Bangkok Condo Investment: Ownership Expenses & Maintenance Costs

As a Bangkok condo investor budgeting and calculating the estimated ownership expenses and maintenance cost of a property is the key to assessing the potential Rental Yield! The “Net Rental Yield” is an important factor especially if you are looking to hold the property long-term between 3-5 years. Ideally as a rental condo investor you want to maximize your Net Rental Yield and eventually enjoy a windfall from capital appreciation when you sell the property. This article will provide a full overview of all the possible expenses a landlord will encounter when owning a condo in Bangkok!

While the level of expenses can depend greatly on the condo’s specifications and its location, we will try to provide an itemized list of cost considerations. Please note, this article will not delve into or provide details of pre-transfer expenses, furnishing cost, renovation costs and sales taxes. If you would like more information about pre-transfer expenses and sales taxes please visit:
To makes things easier to review and understand, this article will categorize condo ownership expenses into the following categories:

Marketing & Real Estate Agency Expenses
Condo & Building Maintenance Expenses
Legal, Tax and Compliance Expenses

Let’s review each property expense category in detail!

Marketing & Advertising Expenses

Rental Agency Commission
If you are going to try and rent a property, you will likely engage the services of a property agency. There is an established rental standard in Bangkok when it comes to rental commission as follows:
1 Year Lease= 1 Month Rent. 2 Years Lease= 1.5 Months’ Rent. The rental commission includes lease drafting, check-in and eventual check-out of the tenant. Marketing material preparation and advertising (I.e. Taking photos, online marketing and print ads, etc.) are also included in the rental commission. The fees do not include tenancy management and maintenance of the property during the term of the rental contract.
Property Management
Property and tenancy management services is a support service that overseas landlords may consider to delegate their property issues.Normally property management companies in Bangkok can handle all aspects of the tenant management, rent collection and maintenance of a property. This is a difficult expense to estimate as there is currently no standard fee structure with different Bangkok management companies charging differently. A general rule of thumb is to budget for approximately 1-month of rent for a 1-year management contract. This can be much cheaper (Or more expensive), depending on the management company!

Condo & Building Maintenance Expenses

Common Area & Management Fees (CAM Fees)
As its name suggests it is a fee for the maintenance of common areas (I.e., Condo facilities, lobby, garden areas, etc.) and building management services (I.e., Juristic Office, 24-hour security and building handymen, etc.). It is issued by the condo’s management office on an annual basis or biannual basis. This is a mandatory expense and late payment of this fee can result in surcharges. Failing to pay the CAM Fees, gives the Condo Juristic Office the authority to hinder or even stop the sale of a condo.
Condo Interior & Content Insurance
It is important to note that “Building Insurance” for major issues that affect the building’s safety and structure (I.e., Fires, Floods, Structure Issues, etc.) are usually included in the Annual CAM Fees. However, some landlords may choose to also purchase “Condo Interior & Content Insurance” in case of internal damages on appliances and fixtures caused by the occupant of the condo; the purchase of such insurance is generally not common or mandatory in Bangkok.
Cleaning & Air Con Maintenance
It is usually standard for a rental condo and the air con units to be cleaned before a renter moves-in. This is usually just routine maintenance work and cost the following: Cleaning (1-Bedroom)- 500- 750 THB Air Con Inspection & Cleaning (Per/Unit)- 500-750 THB* *Maintenance fees for internal air con systems might vary. Air Cons usually need to be cleaned 2-4 times a year.
Utility Fees
While the condo is vacant, the landlord is liable for the payment of water and electricity. A vacant condo will usually have insignificant utility expenses (Under 100 THB on a monthly basis).

Legal, Tax and Compliance Expenses

Income Tax on Rental Income
Income derived from the rental of an investment property is subject to income tax. It is best for the reader to visit the Thai Revenue Department’s website for more info.
Land & Building Tax
The New Land and Building Tax is a new tax that also affects owners of residential property. However, the tax is mostly aimed at multi-site commercial landlords and large property companies; at the moment, retail investors with only 1-2 rental investments are liable to pay only a negligible amount of tax. This is an overview of all the expenses and costs associated with owning a Bangkok condo. By having these expenses in mind when hunting for investment opportunities, investors will be able to maximize their rental yield and long-term returns!

**Xerxes** · 05-04-2022, 09:53 PM

What is the procedure for purchasing an off-plan property in Thailand ?

Purchasing an off-plan property is an excellent option for investors who want to obtain a property in Thailand. With an off-plan property, you can enjoy numerous benefits and flexibilities. For example, you can choose the best units and have the freedom to modify the unit you want to buy. Buying off-plan in Thailand also gives buyers an opportunity to buy a property at a lower price than an already built property with the expense of waiting for the construction to be completed. Plus, the property is likely to increase its value after construction, so buyers and investors can benefit from more significant financial rewards. If you’re interested in buying an off-plan property in Thailand, be sure to read our guide below, so you don’t miss anything!

The Procedure to Purchase an Off-Plan Property in Thailand

Step 1. Select the unit you want and agree on terms and conditions

The first thing you need to do after you’ve found a project by a reputable Developer is to choose the unit you want. It’s vital that you understand the position of the unit you want to buy in the project, such as what amenities are available nearby. Once you’re sure that the unit you want is the best for you, you should make sure that all parties involved agree on the major terms and conditions of the transactions. These may include:

The purchase price and what’s included in it. Some developers may consist of fittings and/or furniture in the price, while others may not.
The payment plans. Some developers may offer flexible payment plans, give a discount or include a furniture package.
Reservation deposit value, which will secure the unit for the buyer.
Whether or not the reservation deposit be refundable if the buyer conducts due diligence.
Taxes and transfer fees, particularly what the buyer and Developer are responsible for.
The schedule for upcoming payments.
The expected completion date for the project and the penalties that are in place should the Developer be late.

Step 2. Due Diligence

Purchasing a property from a reputable Developer with a proven track record doesn’t necessarily mean you can skip the legal due diligence process. Yes, the risk might be lower, but legal due diligence can give you additional safeguards. Be sure to get a reliable lawyer to help you with the due diligence. Your due diligence should include thorough research on the Developer’s credentials, title search, permits, contract review, and access to capital. Keep in mind that not all deposits are refundable, subject to legal due diligence. Therefore, if you want to do legal due diligence, it’s best to make sure that the deposit is refundable.

Step 3. Reservation Agreement

Your Developer will provide the reservation agreement. The document typically outlines the general purchase terms. Additionally, it may also outline the agreed timeline associated with your investment.

Step 4. Reservation Deposit

Once you have found your perfect off-plan property and reached an agreement with the Developer, you will be asked to pay a reservation deposit. The deposit varies from Developer to Developer and market to market. However, it’s typically around 2% of the purchase price. The reservation deposit will secure the desired unit for the buyer, so it is removed from the open market. Make sure you obtain a payment slip for the transfer from the Developer.

Step 5. Review Sales and Purchase Agreement

You will usually have up to 30 days after paying your deposit to evaluate the terms and conditions of the Sales and Purchase Agreement. The Sales and Purchase Agreement contractually specify the entire project and the specifics of the unit you’re buying. Additionally, an agreement to buy or sell a property becomes legally binding at this stage, and the terms of the contract can only be changed by mutual agreement.

Step 6. First Contract Payment

The first contract payment ranges typically from 20% to 40% of the purchase price. For Thailand’s non-residents, the funds have to be transferred from an overseas bank account into the country.

Step 7. Payment Installments

Your next payment will be related to construction milestones, depending on where the project is in the build cycle. The Developer can propose rough timeframes, but payment should be tied to the accomplishment of crucial milestones in the project. Just like the first contract payment, the funds must come from overseas.

Step 8. Snag List

When your house is finished, you’ll be invited to do some ‘snagging.’ This is when you inspect your new home and point out anything that you don’t like or that isn’t up to your expectations. The snag list is usually developed two to three weeks ahead of handover. In short, it’s done to address any issues on the property. If you’re not sure, it’s a good idea to bring a surveyor with you to perform your snagging, as they’ll be able to point out any flaws your Developer will need to address before you move in.

Step 9. Completion and Transfer

When the build of the property is complete, the Developer will issue a completion notice and will agree on a date with you to move in. You’ll have to pay the remainder of the purchase. Once they receive the money, the Developer will hand over the keys, and the property will be yours! To complete the handover process, you do not need to be in Thailand. A third party can do it on your behalf. And that’s it! Now that you understand the steps of purchasing an off-plan property in Thailand, it’s time to hunt down the best projects by a well-known developer. Remember, always make sure that the Developer of your desired project has a proven track record of delivering projects on time.

**Sundance2020** · 06-22-2022, 04:52 PM

Can you buy Real Estate in Thailand with Bitcoin ?

The Thai Government and Regulators such as the Bank of Thailand and the Thai Securities and Exchange Commission have a strenuous “love-hate relationship” with these digital assets. Bitcoin was temporarily banned and declared illegal back in 2013, before finally having its status reviewed only 1-year later… Thailand has now reviewed its stance on these digital assets and the Kingdom now officially recognizes BTC as a legitimate currency; this legitimization also includes several other cryptocurrencies, a select list of which were published in the Royal Enactment on Digital Asset Businesses BE 2561 (REDA). Fast forward to 2021 cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) have now been propelled into the spotlight as an alternative form of investment. Thailand now has several regulated and approved Digital Asset Exchanges and Dealers notably Bitkub, Zipmex and Bitazza.

Can you buy real estate in Thailand with Bitcoin or Crypto? - Short answer is YES!

But, before you start shopping for real estate in Thailand, there are a few things to consider:

1. Finding a Seller & Negotiation
A significant obstacle any buyer will face is finding a seller willing to accept crypto as a form of payment for their property. This in itself is a major issue facing most buyers at present as this severely limits the real estate options available. It is important to note, that if a crypto sale is agreed between the buyer and seller, the additional issue of pegging the exchange rate (I.e., BTC/ THB or ETH/ THB) will also be a major point of negotiation. Interestingly, some real estate agents, especially in Thailand’s coastal cities, have started to advertise both sales and rental listings where the landlord accepts crypto!
2. Foreign Buyers & “FX Forms”
Another important “legal hurdle” specifically facing foreign buyers are the laws and regulations surrounding foreign property ownership in Thailand. At present, foreigners cannot directly own land or landed property (I.e., Villas, Townhouses, etc.) and therefore can only own Condominium Freehold Titles (Condos). The sale and transfer of condos is usually made at the local Land Office and they specifically require a “Foreign Exchange Transaction Form”. This FX Form is issued by a Thai Bank as proof that funds were transferred from overseas and in foreign currency. This is a legal requirement for the Land Office to approve and process the transfer of a condo. Unfortunately, obtaining this document from a Digital Exchange or Dealer is currently not possible. As a result, obtaining this document would require the engagement of a “Third Party Intermediary” to facilitate the sales process.

Therefore, at present purchasing real estate in Thailand using crypto is likely going to be mostly the domain of Thai nationals. The pandemic has been a catalyst for the adoption of crypto and putting them in the spotlight as an alternative investment and legitimate form of currency! Interestingly, the challenging market conditions of 2020-21 have encouraged many established and well-recognized Thai Developers to seek opportunities in the crypto space. Many developers have specifically announced their intention to accept crypto as a form of payment for their new developments or even for the payment of real estate services such as common area and management fees.

Here is a brief summary of the Thai Developers that have made these announcements:

Assetwise
SET-Listed Developer recently announced that it is working with cryptocurrency exchange Bitkub Capital Group Holdings to start facilitating the digital currency exchange service for home purchases.
Origin Property
Origin Property is another established SET-Listed Developer joining hands with Bitkub Capital Group Holdings to accept various cryptocurrencies notably Ethereum, Tether USD- USDT and Bitcoin for a specific selection of their low and high-rise projects.
Ananda Development
Ananda Development, the developer of the Ideo and Ashton branded developments is also partnering with Bitkub to accept digital assets for the purchase of all its residential projects.
Sansiri
Perhaps the most ambitious move is by the highly-established Sansiri, which has invested a total of Bt1.6 billion into XSpring Capital. This company is a financial and brokerage firm that is expanding its financial service offerings into the cryptocurrency space. Sansiri plans to partner with XSpring Capital to accept digital currencies as a form of payment for all its housing projects. The developer is also working on the possibility of launching ICOs (Initial Coin Offerings) to enhance the investment returns of its real estate offerings.

Thailand Real Estate & Cryptocurrency

Thailand’s crypto landscape and its growing influence on the local real estate market is definitely an interesting space to watch. It is important to note that the Thai regulations and laws surrounding these new age digital assets are still “work in progress” and subject to overnight change. Many property professionals view cryptocurrencies and digital assets as a way to stimulate the struggling real estate market. Cryptocurrencies represent an incredible opportunity, especially in the increasingly fast-paced and digitized post-COVID world!

**Steve** · 06-27-2022, 10:59 PM

The pros and cons of buying a tenant occupied condo

For real estate investors looking for immediate cash flow in Thailand, buying a condo with a tenant might seem ideal. After all, it saves you the time, money, and stress of looking for a new tenant. However, buying a tenant-occupied condo in Thailand has both advantages and disadvantages. If you’re not careful, you could end up purchasing a costly problem from the seller. That’s why it’s essential to weigh the risks against the benefits and be sure you fully understand the implications. Before you buy a tenant-occupied investment property, here are some pros and cons to consider.

No need to find new tenants

Finding a tenant for your condo in Thailand can be a time-consuming and expensive process. This is especially true for foreigners who are just getting started investing in Thailand’s real estate. The rental process in the country can be a little bit confusing for a lot of people since there is no fixed standard. However, purchasing a condo that already has tenants saves you time and energy by not having to find new ones yourself. Furthermore, you have some time to prepare even if the current tenants leave when their lease expires.

Get instant cash flow

When you close on a tenant-occupied condo, you can start getting the rental payments right after you close on the property. One drawback of owning a rental condo is that if the property remains vacant, there will be no rental income to help you cover the mortgage. With condos that already have tenants, you don’t have to worry about that right away. You can even end up with extra income after covering mortgage payments and other expenses.

Condo up to code

Another convenience of buying a condo that already has tenants is that it already meets all the legal requisites. Property owners in Thailand have to meet legal requirements set by local law. Thailand currently doesn’t have a landlord-tenant regulation nor a system that regulates this need. The laws that govern this field are, therefore, at best, ad hoc, with contract laws providing the best protection for both parties to the agreement. Landlords usually hold some legal superiority in contract agreements, but they typically make the contract as fair as possible. Still, it’s a good idea to familiarise yourself with the general laws of Thailand regarding landlords and tenants. Moreover, make sure you understand the contract that the current owners and the tenants have agreed to before you purchase the property.

No extra investment needed

Buying a condo with tenants in Thailand means no extra investment is involved. You don’t have to worry about refurbishing the condo since it’s already furnished and rented out. Thus, it’s a lucrative opportunity for those on tight budgets.

Cons of buying a tenant-occupied condo

Lease terms have to be honoured

It’s crucial to remember that a lease is a property right attached to the condo, not the condo’s owner. Thus, buying a condo with existing leases means you must continue honouring those lease terms. Depending on how the prior lease terms were constructed, this might not be favourable to you as the new owner. It could be challenging for you as a landlord because the previous owner didn’t write the lease in a way that was advantageous to the owner. Be sure to review all lease terms before purchasing the property.

Complicated and costly process of evicting a bad tenant

If you need to evict a tenant, the process can be complicated and costly. Keep in mind that you cannot evict tenants just because you bought the condo with the intention of living there. You’ll have to hold off till the end of their lease. Make sure you abide by any rules that may be in force that demands that renters be informed when their leases won’t be renewed.

Inherited legal risk

One of the risks of buying a tenant-occupied condo in Thailand is the possibility that the condo is not in compliance with the local laws. When you purchase a condo in the country, you’re liable for anything on the condo that doesn’t meet the legal requirements. Therefore, you must conduct due diligence and have a thorough property inspection. You should also make sure that the previous owners’ met all legal requirements for purchasing a property in Thailand. Additionally, you’ll also have a legal responsibility to the tenants. If the previous owner didn’t fulfil their responsibility, you could end up facing the consequences.

Problematic tenants

Not all tenants are good, and having terrible tenants as soon as you purchase a condo in Thailand can be challenging. Some tenants may pay rent late every month, while others may damage your condo. If you don’t want to deal with difficult tenants, review the tenants’ payment history and credit reports before purchasing the condo. If you decide to move forward with purchasing a tenant-occupied condo, it’s essential that you perform thorough research and due diligence to ensure that it’s a wise investment.

**Sundance2020** · 09-14-2022, 12:37 PM

What you need to know about transferring funds into Thailand for property purchase

So you’ve decided to purchase property in Thailand? As a foreigner, buying a property in Thailandcan be complicated. You need to really understand the process of buying real estate, including how to transfer your money to Thailand. Any foreigner planning to buy a property must adhere to the proper steps to transfer money into Thailand. If you don’t follow the correct procedure, it could be difficult to repatriate the funds when it’s time to sell the property and/or leave the country. According to the Condominium Act, anyone who is not a Thai citizen but wants to purchase a condominium must send the necessary funds from overseas, particularly for that purpose. No matter where the buyer is from, the cash must be sent in a foreign currency. Then, the receiving bank will exchange it into Thai Baht (THB) when it reaches Thailand. It might seem complex at first. But in reality, the process is pretty simple. You can easily do it without any problems as long as you have the correct documentation.

Transfer Money to Thailand

If you need to transfer money to Thailand to purchase a property, you usually have to send all funds by T.T (Telegraphic Transfer). You need to provide proof of inbound transfer of funds from the issuing bank. Moreover, you have to include the precise purpose of the transfer, such as “Property Purchase, Building Name, Unit Number, Location”. Then, the bank that receives the money in a foreign currency will issue a Foreign Exchange Transfer (FET) form. Suppose you transfer the money into a bank account you hold in Thailand before transferring it to the developer’s bank account. In this case, you are responsible for obtaining the FET form from your bank. However, if you transfer straight to the developer’s bank, the developer will get the FET form from the bank for you.

Foreign Exchange Transfer Form Explained

The Foreign Exchange Transfer (FET) form, also known as Tor Tor 3 or TT3, is the official form required to transfer money over 50,000 USD to Thailand in any currency to purchase a property. In simple words, the FET form serves as evidence that foreign funds were transferred to Thailand and then converted into Thai Baht by a local bank. The form contains the following information:

The transferred amount in foreign currency
The transferred amount in Thai Baht
The name of the money sender
The name of the money receiver
The purpose of the transfer.

You need to present the FET form to the Land Department in order to register foreign property ownership. When presenting it to the Land Department, the form needs to include the name of the purchaser as either the sender or the receiver of the money from the overseas bank. The Land Department may also accept the transfer even if the sender’s and the receiver’s name is not the purchaser’s name. However, the sender of the money needs to instruct the bank to put the purpose of the transfer as “for the purchase of the property by (Purchaser’s name)”.

The amount of money you transfer to Thailand has to be equal to or higher than the selling price that the Land Department declares. Keep in mind that a FET form can only be obtained and is only required if the amount of money you transfer to Thailand is above 50,000 USD. For smaller amounts, the purchaser must obtain a bank certificate or payment slip from the bank as support documentation instead of the FET form when you eventually transfer money back to your home country.

It’s important to issue the FET Form Properly

The proper issuing of the FET Form is vital since it will facilitate you in transferring the funds out of Thailand in case you want to sell the property in the future. If you are planning to inherit the property, it’s a good idea to add multiple names, such as your children or grandchildren, to the original telegraphic transfer. This way, they will the FET form will include their names. Thus, inheritance is easier since the funds can be returned to the account of an heir.

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Buying a Condo in Thailand | Reference Guide

Buying a Condo in Thailand | Reference Guide

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