Who can buy property in Thailand?

Foreigners can purchase property in Thailand under the Thailand Condominium Act. Section 19 of the act regulates foreign ownership of condos, allowing foreigners to own no more than 49% of the units in a condo building.

According to the Land Code Act, foreigners, including permanent residents, are not permitted to own land. However, foreigners who acquire Thai citizenship may be eligible to buy land. While land ownership is restricted, foreigners can lease land and own the home built on it. These leases are typically for up to 30 years, with options for extension. In cases where land and houses have different owners, it is crucial to follow the proper legal procedures to secure ownership of the house. The transfer of a structure separate from the land must be documented in writing and registered with the Land Department at the appropriate branch or provincial office.

Do the research

Investing in Thailand real estate offers several attractive benefits. The country has a strong and growing economy, bolstered by its thriving tourism industry and strategic location in Southeast Asia. Property prices in Thailand are relatively affordable compared to many other international markets, offering good potential for appreciation and rental yields. The country's booming tourism sector creates high demand for vacation rentals and investment properties, particularly in popular destinations like Bangkok, Phuket, and Pattaya.

Here are several sought-after destinations for real estate investments:

• Bangkok - As the capital city and economic hub of Thailand, Bangkok is a prime location for residential and commercial real estate. Key areas like Sukhumvit, Silom, and Sathorn are particularly popular for their vibrant lifestyle, modern amenities, and accessibility. Bangkok offers a range of luxury condominiums and apartments, making it a top choice for investors.
• Phuket - This island in the Andaman Sea is famous for its beautiful beaches and tropical climate. Popular areas like Patong, Kata, and Kamala are ideal for holiday homes, resorts, and luxury villas. Phuket attracts both tourists and investors due to its thriving tourism industry and strong rental market.
• Pattaya - Known for its beaches and nightlife, Pattaya is a popular destination for both vacationers and retirees. Jomtien Beach, Wongamat, and Pratumnak Hill are areas known for their resort-style living and investment potential, offering a mix of condos and beachfront properties.
• Chiang Mai - Located in northern Thailand, Chiang Mai is known for its rich cultural heritage and laid-back atmosphere. Real estate in areas like Nimmanhaemin and the Old City appeals to those seeking a quieter lifestyle, often in the form of traditional houses or modern apartments. It’s a popular location for retirees and digital nomads.
• Hua Hin - Hua Hin, a seaside town with royal connections, has grown into a popular destination for retirees and second-home buyers. Its relaxed vibe and proximity to Bangkok make it an appealing spot for investors interested in beach homes and luxury villas.
• Krabi - Krabi is renowned for its stunning limestone cliffs, clear waters, and laid-back environment. Areas like Ao Nang and Railay Beach offer beautiful beachfront properties and resort-style developments. Krabi's natural beauty and growing tourism industry make it a prime spot for vacation homes, eco-resorts, and investment properties.

Where to find properties online:

• https://www.ddproperty.com/
• https://www.fazwaz.com/
• https://www.hipflat.co.th/

Financing

Banks in Thailand typically offer personal loans to individuals, which can include credit card facilities, business loans, and loans for various purposes such as purchasing a condominium, home renovations, or car purchases. When seeking a loan for real estate, it's important to note that these loans are usually based on the fair market value of the property, determined through the bank's valuation process.

Foreigners seeking bank loans in Thailand must meet several key criteria, including:

• Holding at least a 1-year work permit or a Thai residency permit.
• Providing a letter of employment detailing years of service and annual salary.
• Undergoing credit checks conducted by the bank.
• Demonstrating a fixed income that is three times higher than the loan installments.

Meeting these requirements is essential to secure a bank loan in Thailand.

Due Diligence and Sales Contract 

The due diligence process should start before signing a sales contract. It is crucial to conduct thorough due diligence when buying real estate abroad. It is advisable to engage a real estate agent or lawyer, as they can assist in verifying all aspects of the property to ensure everything is in proper order.

A standard land and house Sale and Purchase Agreement (SPA) outlines key details such as the purchase price, payment terms, responsibility for transfer fees and taxes, the seller's warranties regarding the property's legal and factual conditions, and provisions for termination, default, and contract assignment. The SPA is legally binding and can be drafted in either English or Thai. It is crucial to carefully review the contract before signing. In some cases, you may need to have the documents translated and execute both language versions.

Property Buying Costs and Taxes in Thailand

Footnotes to Transaction Costs Table

The round trip transaction costs include all costs of buying and then re-selling a property - lawyers' fees, notaries' fees, registration fees, taxes, agents' fees, etc.

Transfer Fee
The transfer fee is levied at a flat rate of 2%.

Real Estate Agent's Fee:
A real estate agent's fee is around 3% to 5% of the property value. It is typically paid by the seller.

Legal Fee
Legal fees are negotiable but usually fall between 1.00% and 2.00%