Since land ownership is, with the view that it “may” happen in the future, not yet allowed to foreign nationals in Thailand, a condominium is among the practical alternatives, if not the most, for those who want to acquire a property in the Kingdom.
Nonetheless, even if non-Thai citizens are allowed to own condominiums outright, it is important for the interested party to research more about the idea since several provisions in place need to be satisfied and complied upon as specified by the Condominium Act and one of these is the total foreign ownership quota on the condominium project should not go beyond 49%. If it does exceed the quota, the foreigner may still secure a condo unit within such development but not through outright ownership but only through a lease which has a maximum period of 30 years.
Source of Funds for Purchasing the Property
The funds to be used to purchase a condo in Thailand should be sourced from abroad and this would require supporting documentation outlining the source of funds such as the Foreign Exchange Transaction Certificate.
However, they may choose to have it registered under the name of the Thai spouse but this would require both parties to execute a letter confirming that the funds used in the purchase of the unit come from the Thai spouse and nothing from the foreign national. Again, this would still require additional documents to support the claim.
Transactions regarding exchanging foreign currency must also happen within the Kingdom.
Yet, it is also worthy to mention that foreign residents with Permanent Residency are not required to comply with the source of funds requirements.
Steps in Purchasing the Property
A condo purchase by a foreigner is a relatively straightforward process but still the interested party must do the necessary prudence to ensure a safe and successful property acquisition.
- Physical Inspection
Reality dictates that condos do look good on company catalogs, on various magazines and online sources and this is primarily because these are being published to market the development. To make sure that what was presented on these marketing tools are true and the quality of workmanship is within his expectations, a thorough physical inspection can help. This way, the foreigner can check if the finish and materials used are up to standard and are of good quality.
- Title Search
Not all types of lands in Thailand are open for condo developments and a title search can help confirm if constructing a condo building in the area is allowed and no existing local ordinances oppose this. The buyer should also note that in condo developments, there are two types of titles: the Or Chor 2 or the Condominium Title and the separate title of the land where the development is being or has been built upon.
- Background Research
It pays to know what kind of neighborhood the foreigner is looking forward to being a part of especially that he and the rest of the condo unit owners do share several common areas and hallways which makes privacy an issue for some. Furthermore, he would know how the unit owners have responded or have contributed in the development and implementation of the adopted rules and regulations as well as on how the condo management has run its affairs and responsibilities.
- The Condominium Management or Association
Prior to any commitment, which is expressed through a signed contract and or down payment, it would be better if the foreign national would be able to furnish himself with the current rules and regulations as adopted by association and implemented by the condo management and included are the monthly maintenance and sinking fees.
As it is a momentous investment in his part, the foreigner must know more about the developer to allow him to gauge the entity that is fulfilling his dream of owning a condo in Thailand. This should include the background of the developer on how long it has been in the business of developing condos as well as its financial capacity in finishing the project especially if the unit is being bought off-plan.
Consulting a Thai Property Lawyer
A condo is the easiest type of property that a foreigner can acquire in Thailand. Nonetheless, the process in doing so and the things that should be done to ensure a successful and pitfall free condo purchase would be quite complicated for a non-Thai national.
To make sure that these are addressed properly, that the rights of the foreigner are well protected and the process has been diligently followed, it would be of huge help if he would consult a Thai property lawyer.
This lawyer would guide and or assist the interested party in doing the necessary safety checks such as a title search. Also, the same lawyer can make sure that the foreigner has fully understood the condo’s rules and regulations by translating its contents. His legal adviser can also review the contract draft to ensuring his rights would be upheld.
- Physical Inspection