Property Purchase Pitfalls
Purchasing Property In Thailand
It is recommended that you discuss your options and the process of purchasing in Thailand as a foreigner as it is essential to know the legalities involved in such an acquisition of property by foreigners before making any decisions on your purchase whether this is a condominium, land, house or a villa anywhere in Thailand. Foreigners may own condominiums freehold and outright 100% therefore making this option the least complicated and the best option for a foreigner wishing to purchase property in Thailand. Thailand condominiums always have a foreign quota of 49% which means that only 49% of the total space of a condominium can be owned by foreigners on a freehold title. The other 51% refer to Thai Nationals. Before purchasing a condominium in Thailand, it is advised to ensure that the foreign quota has not exceeded.
Title Deed Search
A title deed to outline the property in which is purchased is usually not provided up front. For this reason, it is suggested that before making any such deposits or purchases, a title deed copy is obtained from the seller in which the original is contained at the relevant land department and a title deed search should be performed so as to avoid any negligent misrepresentations in the future with regards to the property that you wish to purchase. This will determine the true legal owner of the land and determine as well whether there are any registered encumbrances on the actual property such as a mortgage or a lease. This investigation will also investigate whether there you are permitted to build upon the land by determining what kind of title deed the property possesses. It can also be determined with a detailed due diligence the environmental zoning areas, residential and planning codes.
Reserving Your Property
Once a title search has been performed and you are happy to proceed with your purchase, it is usually requested by the developer or the seller that you make a first initial deposit or a reservation fee in order to reserve the property to provide for consideration. The seller will then reserve the property for you until the actual due date for the sales contract for the remaining payment. Note that the remaining payment should not be made until the actual transfer at the land department. Please bear in mind that if you decide to not go through with the contract, that in usual cases the reservation deposit will be forfeited. It must also be noted however, that sometimes a reservation fee is requested prior to such obtainment of title deed.
Sales and Purchase Agreement
When you have provided the reservation deposits, the contracts should be provided to you by the developer or the Seller. Usually if this is a developer, they will have a copy in English and in Thai. Regardless, once you have received a copy of the contract, it is recommended that before signing such a contract, that you review this with a Lawyer or Solicitor. A review of the Sales and purchase agreement will involve identifying your rights as a buyer in order to protect your interest in the event that the Seller defaults in the completion of a property development, or in the event that there was a breach of contract. This will also determine the various taxes payable and the whether the payment method is appropriate.
Pitfalls in Purchasing Property in Thailand: Unfinished Projects-
this occurs in the event that there are condominiums, villas, houses, townhouses and any kind of residual or even business real estate are meant to be completed within a stipulated time as specified in a contract. If this occurs buyers will have recourse by Civil law as breach of contract and be able to demand that the project be finished within due course and/or the monies paid by the individual buyers be returned with full interest within a specified time period. To avoid this kind of situation, it is important to check the development company background of the project in order to determine whether the company has a good reputation and their prior projects timeline and execution.
this arises as a result of property disputes of ownership as there may be forgery of documentation when purchasing property or in a nominal structure. Although this is not a common occurrence, there are times when title deeds have been forged or signatures have been forged in order to sell a property and retrieve money that is not rightfully theirs to begin with. The buyers are then at a loss with not only a loss of money but nothing to gain from anything being paid. With this, sufficient evidence would be transfer slips, prior written and/or signed agreements, and identification and/or names of the fraudulent party or parties. It is always important to remember that no matter in what situation to always have track record of payments being made although the development or company may seem legitimate and well known.
this occurs when an owner of one property has built over their boundaries and have encroached onto another’s land. This is also a common occurrence however mostly out in rural areas in Thailand as most of the area is agricultural land. There are times when houses are built upon these agricultural lands without the knowing of the exact boundaries, hence having to encroach upon another’s land or property. This also includes disputes that arise in the event of a high rise building blocking the view of another high rise building. This usually occurs in areas of beachfront property. There is no such avoiding of such acts, however, there is always recourse to such acts upon your property
easements are described as a right of way such as a passage or a pavement in which may be the property of another however, is needed to be utilized in order to get to another property as a right of way. In this event, there are some occasions where some parties act upon an action of trespass, whereas it may not be as it is essential to pass through their property to get to another. There is not such avoiding of an easement upon your land or upon another’s, however, there is always a recourse in which a Court of law will have to interfere in this instance in order to grant a right of easement. Whether purchasing a condominium, villa or a house, it is suggested that prior to making such a purchase, once you have found something of interest, to contact a lawyer or solicitor before proceeding. At Jus Laws & Consult we offer specialized services with our knowledgeable lawyers on local and International law to assist with foreign acquisition of property. Contact us today at our office either in Bangkok or in Phuket for free basic consultation!