Buying a new property is a big step for anyone and something that naturally takes a lot of thought and planning. If you’re considering a property purchase in Thailand, then we have created this simple guide to explain the procedures. If you are in any doubt of the benefits of using an agent to assist with your search you might want to read our "Why you should use a real estate agent in Pattaya" Blog.
Also, you may wish to know more about the legal aspects of owning a house or condominium before deciding by consulting our Legal Guide
Buying a new or off-plan condominium
With hundreds of condominiums either under construction or at the planning stage in Pattaya finding the right property can be a daunting task. The first stage in choosing a property is determining what you actually require. You will need to choose an area of Pattaya that matches your needs, the level of quality that you desire and meets the budget that you have in mind.
The next consideration is whether you are looking to buy something that is under construction or whether you are looking to purchase something in a recently completed project. Again, there are a number of factors that you need to take into consideration. One of the most obvious questions is about the developer, their experience and do they have a proven track record. These are all things that we can help you with.
Once you have decided on the type of property you would like to purchase, it is highly likely that you will want to visit the project, maybe to see the finished article or the construction site and the developers’ showroom. We can arrange these visits on your behalf at a time that suits your schedule. At this stage, you may have further questions and once again will are only too happy to assist you with addressing any concerns or questions that you may have.
How is the transaction completed?
Now that you have decided on a property that you wish to purchase; the transaction process starts.
You reserve your chosen property by placing a small booking fee, usually in the region of THB 50,000. The developer will issue you with a receipt and this will secure the property. This can be done by cash, credit card or bank transfer. This booking or reservation fee will be included in the total price on the contract but is usually non-refundable should you pull out of the transaction.
The next stage after paying a booking fee is for the developer to prepare a sales contract. To complete this task the developer will need some information from you such as a copy of your passport, your registered address, your telephone number and email although it is not uncommon for more documents to be requested. Some clients may want the property to be in more than one name such you are your partner in which case they too will be asked to provide the same information.
The developer will then draw up a payment plan, this may be a standard plan or in some cases it is possible to negotiate with the developer. It should be understood that this is NOT a mortgage and the instalments can be typically spread over anything up to three years. The initial payment you usually make is between 20% and 30% with payments due over the construction period (typically 9 months to 3 years) and a final amount due on completion/transfer.
Most developers in Pattaya are very professional although it always pays to read through the contract to check that there are no anomalies. The sales agreed price and payment schedule should be clearly stipulated within the contract along with finer details such as the date for transferring ownership, who pays fees and taxes and the issues of guarantees and due diligence.
The third and final step in the process is the ‘Settlement and Registration of Property Rights.’ These usually take place at the same time with the buyer making ‘full and final payment’ to the developer and the developer transferring ownership into the buyers’ name. Registration will take place at the regional Land Office and in the majority of cases is fulfilled by the developer. Once this has been completed you will receive the title deed which in Thailand is referred to as the Chanote.
Buying a property on the secondary market
The initial process of buying a property on the secondary market is very similar to that when buying a new property. Once again you will need to take various factors into account such as location, size, surroundings and naturally your budget. You can search through our database to get a few ideas or alternatively you can speak to one of our experienced consultants who will be able to assist you. The next stage is to actually visit the properties. After you and our consultant have selected some properties we can arrange a mutually agreeable time for you to inspect them.
Once you have selected the property that you wish to purchase the negotiations with the seller can begin. This is the stage where you will decide upon the final sale price, the size of the deposit, possible financing and also who will pay any fees and taxes. It is always wise at this point to appoint a lawyer to check for due diligence of the property and ensure that every aspect of the negotiations is added to the contract. We can advise reputable lawyers and assist you with this process.
The next stage is the preparation for the transaction to be completed. If you are buying a condominium in ‘foreign name’ you will need some extra documents in order that you can acquire the unit, with the main document being the FET Form often referred to as a Tor Tor 3 (Sam). This is a document issued by the bank that confirms that the funds have been transferred into Thailand from overseas.
We will be able to assist you with collating all the information as well as preparing the contract as previously mentioned. We will endeavour to ensure the maximum possible security of your rights including various penalties should the seller not fulfil their obligations within the agree time scale or should the sale fall through because of the actions of the seller. However, it must be stressed that we are acting on behalf of both parties so therefore the contract must contain similar obligations to be placed upon the buyer should they fail to meet the terms of the contract.
The final stage of the transaction process is the registering the sale at the local Land Office and involves the re-registering of the property rights on the Chanote. At this point, all fees and taxes should be paid in cash. The exact process varies with condominiums and houses so to find out more you should read our Legal Guide for more details as this can be quite complex if you're unfamiliar with the property ownership laws in Thailand.