Country Buying Guides - Thailand

The conveyancing process

• Independent Lawyer
It is essential to use an independent lawyer with a legal knowledge of both the English and Thai legal systems, who are able to translate the documents and explain the terms to your full understanding.

• Due Diligence
It is important to carry out due diligence on the property you are purchasing in order to ensure there are no encumbrances on the property. Your independent lawyer will do this on your behalf.

• Restrictions
Non nationals cannot buy land in Thailand, only condominium units and apartments. Non nationals cannot make up more than 40% of the condominium’s unit-owners. However, a Non national can buy a whole building, minus the land on which it is built.

• Lease renewals
Thai law allows non-residents to explore the Thai real estate market. A non national can hold a 30-year renewable lease, under which the buyer registers at the Land Office an option to renew the lease contract indefinitely, for further 30-year periods. Lease renewals cannot be registered, and are not effective against a purchaser of the property, and without the prior consent of the owner you cannot sublease, sell or transfer your interest.

• Private Limited company
Another option is to set up a private limited company with mixed Thai and foreign ownership, the foreign ownership being 49% or less. Companies are allowed to own land. The foreign national can control the company by using a legal power of attorney from the Thai shareholders, handing control to the foreign directors. This is the most commonly used route taken by Non nationals.

• Title Deeds
There are many different types of deeds which title your property is under may affect your purchase.

o Chanott ti din
These are the more preferred title deeds meaning that the land has been accurately surveyed, giving indisputable possession of the land. However most of Thailand is not under this title.
o Nor Sor Sam” or “Nor Sor Sam Kor
These are the most common titles found. Land under these indicates that clear records of ownership are maintained. The land may be sold or leased, but tend to be less accurately surveyed than Chanott ti din titles.
o Condominium Titles
These are titles to part of a building or buildings with multiple owners, and a fractional interest in the land, always a Chanott and other common assets, such as a swimming pool and common parts of the building, such as the stair well. The title will state the floor area of the private apartment, the ground area of the common land and the percentage interest which that apartment has in the common property.

• Purchase agreement
Once the vendor accepts the offer, his lawyer will prepare a purchase agreement. A deposit of 10% will be paid upon signing. Deposits are non-refundable unless it is the vendor who backs out; if this is the case, he will need to pay you double the amount for damages.

• Completion
Completion usually takes 30 to 60 days. This includes the exchange of contracts and settlement of the remaining balance. When these have been accomplished, the title deeds will be submitted to the Land Department for registration and payment of government duties.

• Costs & Taxation
Stamp Duty at 0.5% and a Transfer Fee of 0.01% of the purchase price is payable by the vendor.

• Inheritance
Most foreign legal systems’ inheritance law is different to our system, hence it is extremely important to use your independent lawyer to help you make a will so that in the unfortunate event of your passing, your wishes and not the word of the law is followed.

In Assocation With The International Property Law Centre LLP