According to the Tourism Authority of Thailand (TAT) 24,081,613 foreigners entered Thailand between 1st of January 2023 and 25th November of 2023. By statistic, in the future many of these foreigners who came as tourists will consider places such as Bangkok Phuket or Samui as a second home by purchasing a condominium unit and obtaining visas for the long term. After the end of the pandemic, and during the last quarter of 2023, our law firm in Thailand H&P have assisted several private clients to acquire luxury condominiums, especially in Bangkok.
Thailand is a top destination for both: traveling and residence. Purchasing a residential unit in Thailand can be not only an excellent investment opportunity but a way to improve the lifestyle of families and private individuals. Although the foreigners generally cannot buy and have the ownership of the land in Thailand, they can buy and have the ownership of the condominium in Thailand. Hence, purchasing a condominium is the main alternative of building a life in Thailand. H&P attorneys with experience in real estate in Thailand, have prepared this summary of the legal aspects of buying properties in Thailand by foreigners.
Legal Due Diligence BEFORE you buy a condo unit
It is essential to conduct a comprehensive legal due diligence before you sign any sales and purchase contract. For example: only in 2023 at least two almost finished luxury condominiums developments in Pattaya and Asoke/Bangkok, among others projects, faced severe legal problems and even demolition order for not having a construction license.
In our professional experience the role of the lawyer in Thailand should shield and protect the foreigner who want to invest their money from abroad and buy condominium units. For example, it is important to check updated copies of the tittle deed to assess if there is a loan, encumbrance, debt or pending litigation affecting the condo unit.
Qualifications to buy a condominium unit in Thailand
A foreigner, who wish to purchase and register the ownership of a condominium in Thailand, must check the restrictions of owning a condominium in Thailand. According to Thai law, it is prohibited for a foreigner to own more than 49% of the total units in the condominium building. Hence, foreigners in one condominium cannot exceed 49% of the sold space in the condominium. Based on our professional experience, the lawyers you engage need to check the list of the units and quota at both the Land Department and the Juristic person as sometimes the quota does not match in both lists.
Besides the above qualification for the foreigner to own a condominium in Thailand, there is not additional restrictions or qualification stated in the law. This means that a foreigner can own a condo unit and register the ownership under his/her name at the Land Department. However, the foreigner, unless have permanent residence, should remit the money to buy the condo unit from a foreign country.
In other words, the payment method should involve a foreign exchange transaction as stated below. Hence, there are two alternatives for a foreigner to purchase a condominium unit in Thailand. The foreigners who have permanent residence can buy condo units without remitting the funds from abroad but other foreigners with other type of Visa need to transfer the money according to foreign exchange transaction to receive a FET document
On the other hand, it is important to bring the same amount of higher than the purchase of the unit to obtain FET and register the new owner at the Land Department in Thailand. The concept of the international bank transfer must reflect the complete information of the purchase.
Remittance of funds from abroad to purchase a condominium in Thailand
To purchase a unit of condominium in Thailand, a foreigner must comply with the regulations of transferring money into Thailand. Such regulations are related of receiving a foreign exchange transaction document (FET) from the bank for the purchase of more than 50,000 USD. Without FET document, a foreigner cannot be registered as a condominium owner at the Land Department.
Foreign Exchange Transaction (FET) is a document showing the transaction between a commercial bank and its customer relating to the purchase by foreign currency of more than 50,000 USD. The FET involves in purchasing a condominium in Thailand because a foreigner has two alternatives to purchase a condominium as follows:
A) He or she can transfer the money from his or her foreign bank account directly to the Thai bank account of the developer of the condominium.
B) He or she can transfer the money from his or her foreign bank account to his or her own Thai bank account and then transfer the money to the developer of the condominium.
In our opinion option B is the best option, as H&P lawyers can open a personal bank account for any foreigner who wants to buy a property in Thailand regardless the visa status.
Registration at the Land Department
After purchasing a condominium and receiving the FET document from the bank, a foreigner can have the ownership of the condominium by registering to the land department.
Registration at the land department will make a foreigner officially owner of the condominium unit.
Mostly, the lawyers of the buyer of the condominium will assist on registering to the land department. A foreigner can give power to the lawyer by signing a power of attorney to proceed the registration process and/or assist with the payments. In case you want one of our property lawyers to assist you with the process of registration of the new ownership, we will need the following:
-A copy of passport
-A foreign exchange transaction document (FET) in case a foreigner does not have Thai permanent residency.
-A power of attorney in case a foreigner gives power to other persons to proceed the registration process
Besides the above documents, the developer, who is the seller of the condominium, should provide the documents such as the sales and purchase agreement, or the ownership deed etc. We also recommend reviewing such documents by property attorneys in Thailand.
House registration
After a foreigner has the ownership of the condominium and has registered this at the land department, he or she can register to be the householder in the house registration. The house holder document is separated from the ownership of the condominium. To register as a householder, a foreigner must prepare the following documents:
-A passport
-A copy of passport legalized by the embassy and a Thai translation version legalized by Thai consular
-A work permit (in case he or she has a work permit in Thailand)
-Thai version of Tor. Ror. 14
-Ownership deed
-2 pictures of 1.5 inches size
-At least 2 witnesses
-A picture of a condominium, which has the number of the room and inside the unit
Because the house registration is beyond the ownership transferring process, the developer of the condominium may not help a foreigner in this process. After doing the house registration (yellow book in case of foreigners and blue book in case of Thai) the foreigner can obtain a pink ID card of Thailand.
If you want to buy a condominium unit in Thailand and need to protect your investment, please contact H&P Property Lawyers in Bangkok at [email protected]
