Foreign Ownership of Condos in Thailand: A Comprehensive Guide

Thailand’s vibrant cities and beautiful coastal areas make it an attractive destination for property investment. For foreigners, owning a condominium unit is a viable option, but it requires navigating specific legal requirements.

Here’s a detailed guide on what you need to know about foreign ownership of condos in Thailand.

What is a Condominium?

Under Thai law, a condominium is a building that can be divided into units for individual ownership, with common properties shared among all owners.

These common properties include the land on which the building stands, hallways, elevators, and other communal areas.

Only buildings licensed under the Condominium Act and registered with the Land Department offer individual ownership of units and joint ownership of common areas.

Types of Apartments and Condominiums

Licensed Condominiums: These provide individual ownership of units and common areas, with government-issued ownership title deeds.
Holiday Apartments: Private holiday apartments and tourist condos not licensed under the Condominium Act offer possession under private contract structures but do not provide ownership of units or joint ownership of common areas.

Foreign Ownership in Condominiums

Foreigners can own a unit in a licensed condominium within the foreign ownership quota, which is limited to 49% of the total floor area of all units in the building.

It’s essential to confirm that the foreign ownership quota is available before purchasing a condo.

Eligibility for Foreign Ownership

To own a condo in Thailand, foreigners must meet the following criteria under Section 19 of the Condominium Act:

Legally enter Thailand.
Transfer the full purchase price into Thailand as foreign currency, exchanged into Thai baht by a Thai bank.
Obtain proof of the foreign exchange transaction (FET-form).

Eligible foreigners include:

Those with residence permits.
Those entering under investment promotion laws.
Certain juristic entities.
Foreigners bringing foreign currency into Thailand.

The Sale and Purchase Agreement

The purchase and sale agreement is crucial in finalizing the interests of both the buyer and seller. For new condos, the agreement must comply with condo and consumer protection laws.

For resales, the agreement is governed by general contract law.

Key aspects of the agreement include:

Unit details.
Party details.
Price and payment schedule.
Transfer date.
Transfer fees and taxes responsibilities.
Seller and buyer warranties.

A professional review of the agreement and due diligence checks are essential before signing.

Transfer and Registration Process

At the time of transfer, both parties must present various documents at the Land Department’s branch office. This includes the unit’s original documents, ownership deed, and proof of foreign currency exchange.

Taxes and Fees

When transferring ownership, the following taxes and fees apply:

Ownership transfer fee.
Specific business tax (if applicable).
Stamp duty.
Income withholding tax.

A professional review of the agreement and due diligence checks are essential before signing.

Maintenance Fees and Sinking Fund

Condo fees cover maintenance, repairs, and common services, based on the ownership ratio of the common property.

Inheritance and Property Tax

Foreigners can own a condo for life, and their heirs can inherit it, provided they qualify under the Condominium Act. Taxes and fees are payable upon ownership transfer.

Common Mistakes to Avoid

Not ensuring the purchase is a freehold under the Condominium Act.
Not transferring foreign currency into Thailand.
Not obtaining legal advice on taxes, fees, and the sale agreement.
Not conducting due diligence on the unit or project.
Not using escrow in payment schedules.
Not checking for encumbrances on the unit.

Conclusion

Owning a condo in Thailand as a foreigner is a feasible option with the right legal guidance. At Closer Law, we specialize in real estate law and are here to assist you through every step of the process.

Why Choose Closer Law?

Navigating the complexities of Thai property laws can be daunting, but with the right legal guidance, foreigners can successfully own buildings on leased land.

At Closer Law, we specialize in real estate law and are here to assist you every step of the way.

If you have any questions or need legal assistance regarding property ownership, our experienced team at Closer Law is here to help.

For personalized legal advice and to ensure your property transactions are seamless, contact us today!

We provide:

Expert legal advice tailored to your specific situation
Assistance with documentation and fair practices
Representation in negotiations or, if necessary, in court

Together, we can safeguard your success and ensure your peace of mind.

Contact us today

📞 Call us: +66 (0)61 645 8553