How To Buy a Property in Thailand | Step By Step Guide
This is a step-by-step guide on how to buy a property in Thailand 2021. We guide you through the full process, all the way from the initial thought of purchasing a property in Thailand up until the moment that you hold the keys to your new home in your hand.
First things first, should you invest in a property in Phuket, Thailand? If you want to enjoy a relaxed and affordable lifestyle, year-round warm weather, and swimming-friendly beaches, then the question is a resounding YES! Since you are reading this and considering buying a property in Thailand, you have most likely already visited the country and know what we are talking about. Thailand, and Phuket in particular, is one of the most popular tourist destinations in the world, so it would make sense to invest in property, whether you want to live here permanently or have a second home, a vacation home perhaps, to call your own.
It is however worth noting that Thailand is very much a cash-buyer market, as mortgages and bank loans for foreigners in Thailand are hard to acquire unless taken in the name of a Thai national. Send us a message and we'll see if there is an option for you.
Without further ado, let's dig into the process of purchasing a property in Thailand.
Step 1. Define Your Requirements
Phuket is host to a wide variety of properties with different attributes and with price ranges from just a couple of million Thai Baht to luxurious multi-million dollar residences. Some homes are more suitable for residential purposes while others are better purchased as a pure investment, generating an income while at the same time providing the owner with a holiday home.
Despite being a smallish island (576 square kilometers), different areas of Phuket can have very different attributes when it comes to proximity to the beach, the airport, amenities, shopping centers, international schools, etc. which also are things to take into consideration. You might also want to decide whether owning a property foreign freehold would be a requirement, or if you would be OK with other options like owning via a Thai LLC or Leasehold.
Step 2. Preliminary Property Research
Now when you have your requirements pegged down, it's time to do your preliminary property research. At Pulse Real Estate, we have a database of more than 700 Properties in Phuket for Sale. You can refine your search based on property type, location, completed or off-plan, and also more detailed filters like foreign freehold, private pool, and much more. If you still can't see the forest for all the trees, feel free to utilize our Property Finder Service where you provide us with your requirements or simply shoot us an email and one of our property advisors will put together a personalized shortlist of properties for you.
Step 3. Inquiry & Initial Consultation
If you find a property of your liking, either add it to your shortlist on the website or send us an inquiry directly. Your inquiry will be assigned to one of our advisors who will get in touch with you. From there on, the communication can continue via whichever medium you prefer, whether it be emails, phone calls, WhatsApp, or any other chat application of your choice.
Step 4. Viewing Shortlist & Property Inspections
Our advisor will sit down and listen to your requirements closely and narrow down a shortlist of properties for you. Their local expertise will ensure you are not wasting time on any properties that on the surface look like a good fit for you, but have downsides you might have missed. As an example, if being close to an international school is a key requirement, it would be a bad idea to stay in an area without international schools around etc.
When you have agreed on a shortlist, our advisor will make arrangements for a property tour. We offer free pick up and drop off at your hotel/residence and will show you the properties in person. If you can not attend in person, we can record a video or set up a video call so you can conduct the viewing remotely.
Step 5. Price Negotiation
If you are working with an agent (which we recommend), they will help you with the negotiation process. When purchasing an off-plan unit, the furniture package that normally costs extra can often be included in the deal. You can also often get a price reduction if you are ready to pay a big chunk upfront. When it comes to dealing with private sellers, a payment plan can often be negotiated.
Note that to buy a condo foreign freehold in Thailand, foreign money has to come in from overseas, and a Foreign Exchange Transaction Form (FETF) must be presented at the land office when signing over the property. The purpose of the transfer has to be mentioned, for example, "Purchase of a Condominium".
Step 6. Reservation Agreement & Reservation Fee
Once a price is agreed upon, a reservation agreement is prepared. The reservation agreement simply states that the buyer has the intent of purchasing the property from the seller to take the property off the market until due diligence can be performed by the buyers lawyer. The reservation agreement also includes the reservation fee figure and the date for the final transaction. A standard number for the reservation fee is 5% of the agreed sale price. While the reservation fee as per standard is non-refundable (granted that the property passes due diligence), it is part of the sale price and deducted from the full price the buyer pays.
Step 7. Sales and Purchase Agreement & Due Diligence (lawyer)
Next up the sales and purchase agreement is produced, most commonly signed within 30 days of signing the reservation agreement, but it can differ. At this stage, it is highly recommended that both the buyer and the seller have appointed their own lawyer to prepare the paperwork, and in the buyers' case ensure that due diligence is made.
Example of due diligence to be made is confirmation of the land title and ownership, building permits, Environmental Impact Assessment (EIA), proximity to the beach (can not be closer than 50m from the beach) and height (can not be 80m above sea level).
Once the lawyers have hashed out the details, both parties sign the contract and a larger down payment (deposit) often at least 20% of the total value is paid by the buyer.
Step 8. Transaction at Land Office + Final Payment
The last step is completed at the land office, where the completion of the purchase and final transfer of the property is done. A transaction can take anything from two weeks and 1 1/2 month for an already built property to complete. Off-plan properties are typically not handed over until the property is complete so the date of the finalization will depend on the construction schedule.
If either party is not in Thailand, this can be done remotely by signing a power of attorney with your solicitor. The final payment is made, transfer fees are paid and the property is officially handed over to the new owner.
Can You Buy Property in Thailand Online / Remotely?
It is indeed possible to purchase a property in Thailand online, without physically being in the country. This of course comes in handy now that the COVID-19 pandemic has put international traveling to almost a halt.
At Pulse Real Estate, we offer virtual property viewings where we either record a video of the property/properties you are interested in or make live WhatsApp video calls, so we can walk you through the property as per your requests.
The sale process can be completed by giving your lawyer power of attorney (POA). This goes for both seller and buyer, so neither one have to be physically in Thailand to complete the deal.