Legal Tips For Condo Buyers In Thailand
One of the common spoken or read summary regarding foreign ownership of any property in Thailand is:
“Foreigners can buy a foreign freehold condominium in their name.”
With this, a lot of foreign investors already switch off or assume that all the succeeding details are either a legal nonsense or an attempt to win them.
There is a lot to learn about Thai condominiums even before beginning to property hunt.
- Only forty-nine percent of a condo’s Registrable Area could be sold to foreigners.
In Bangkok, this will not have too much impact as most owners are Thai nationals. It is uncommon for foreigners to be more than the Thai as owners. This rule keeps foreigners controlled by numbers and percentages.
- There is an oversupply in the Bangkok condos, and the rental yields are usually low with regard to % as compared to other Asian cities like Singapore or Hong Kong.
A condo in a major rentable area even at a high investment price could stay rentable because of its location and amenities. Another condo located at the end of that similar ‘Soi’ could remain unrented even if the rent price is cut by fifty percent.
Additionally, the authorities are very keen about tax declarations and catching those undeclared taxes. This doesn’t only mean the personal income tax but also the 12.5% business tax for renting the units out.
- Foreigners don’t have a say about a condominium’s management.
This is unless over fifty percent of the voting rights which are attached to the units in the whole building is bought. If not, then a minority voice regarding issues like making use of a sinking fund to fund repairs, common area fees, or changes to some rules / regulations and maintenance decisions will not be significant. The way on how a building is managed comes down to how a developer has a structured ownership, whether they retain a lot of units and a big percent of voting rights or not, and regardless if they plan to do the managing themselves or outsource the asset management to a reputable or not-too-reputable company.
In the end, it is best to seek for a Legal Advice in Thailand when buying properties. These are just some examples of the reality in condo buying in Thailand. They will also be able to give advice regarding any confusing legal matters especially on a foreign country different from one’s own.