4 Things You Should Know Before Investing in Property in Thailand
Bangkok is a bustling city with a vibrant real estate market. It is the economic heart of the country, and it is a world-class city that attracts people from all over the country – and the world. This metropolitan city is still growing and changing, and many want to be a part of that evolution. Here are four things you should know before investing in property in Thailand.
Understand the Laws that Apply to You
Thailand’s laws forbid foreigners from owning land. However, this doesn’t mean an expat can’t buy a home in Thailand.
One option is to buy land through a Thai limited company. You own part of the company, and the company owns the land. Another option is to buy a “leasehold” property. In a leasehold, you aren’t the owner of the land – a Thai national or company is. Instead, you’re paying for exclusive use of the land. It is a contract that is usually good for up to 30 years, and it can be renewed up to three times.
Another option is buying a freehold condominium. Any foreigner can buy a freehold condominium as long as they’re legally allowed to enter the country. In these cases, the total ownership in the condominium cannot be more than 49% of the space in the development.
Get the Paperwork Done Right
Make sure that you work with a reputable Bangkok property agency to help you with ownership transfer. One common scam involves selling a lease on property though they don’t have the legal right to do so. Other problems occur when the lease terms are so onerous or complex that you end up losing the property.
Another issue that trips up foreigners is the various types of title deeds. The Freehold or Nor Sor 4 allows the owner to do whatever they want with the property as long as it is within the law. Nor Sor 3 Gor means someone doesn’t yet have a freehold but is waiting on it. Nor Sor 3 means the lands department hasn’t assessed the property yet. The ideal situation is the freehold or Nor Sor 4. That allows you to build almost any type of home, though there may be restrictions on the type of structure built in the area.
Understand the rules that apply before you buy property since you may not be allowed to build the home of your dreams on the property you fell in love with. And plan for the worst-case scenarios. For example, you want to have a clause in the contract that indicates the expectations regarding the deposit and who gets the money if problems arise.
Take Your Time
As with all real estate, rushing these decisions is costly in more ways than one. Take your time so that you can find the right property for you. Don’t demand to close on a property and find out you overpaid or can’t build the spacious home you want. Have your lawyer review all paperwork thoroughly and ensure that you understand what you’re signing. Ask questions so that you understand the monthly or annual fees you’ll owe on the property (if any).
Bangkok is a wonderful place to live, work, and play, and many expats buy property here with the intention of staying or renting out for profit. Make sure that you follow our advice if you want to avoid issues and start on the right foot.