First of all, it is worth noting that sales and purchase agreements in relation to the purchase of singular units at condo developments are generally straightforward involving a simple land title transfer, especially in cases where the condo unit is already completed.
In the case of a purchase in an off-plan development, more factors come into play such as the business structure of the developer, the project structure, and the presence of the correct permits and licenses. A reputable real estate agent should be able to give honest feedback on the track record of the developer and evidence of previous projects completed.
The purchase of a house or a villa involves either a company structure whereby the property is held as an asset of the company or under a 30-year renewable lease structure. In these cases, the situation is a bit more involved and a lawyer to help navigate the process is recommended.
Thai Condominium Law has been in existence since 1978 and is a clear robust law which lawyers are experienced in working with. As has been well published, anyone can legally own a condominium in Thailand freehold completely in their own name as long as the funds used to purchase the condo originate from outside Thailand.
When buying a unit in a large development that has sold a significant number of units already, it is likely that any lawyer that is hired to review the sales and purchase agreement, will likely be familiar with it, perhaps having already reviewed it on behalf of a previous client.
In this case, the research and background into land titles, background checking of the selling company, a review of the contract, and a list of recommendations would have already been produced. It is beneficial to the client that the lawyer has experience with the contract and developer and is familiar with all the key information.
Another thing to bear in mind in the case of larger condominium developments that have sold a significant number of units already is that each time a lawyer proposes an amendment that makes the agreement more secure and encompassing, the developer will update their master copy.
This means that the sales and purchase agreement has already been viewed and amended a number of times by lawyers both local and international.
Clients often ask us about lawyers and the procedure involved.
As an agency, we can assist our clients to find a suitable lawyer but we don’t recommend any specific lawyers as such. The lawyer works for the client and agents should be able to work with any lawyers and facilitate the process by helping to track down any documents required and be a line of communication between all parties.
A reservation agreement can be produced without a lawyer and is a straightforward document, usually one page only, which specifies the agreed terms of sale. It is the responsibility of the seller, through a lawyer, to produce the sales and purchase agreement. The lawyer will produce the sales and purchase agreement from the details contained within the reservation agreement.
Please note that it is not the responsibility of the real estate agent to produce this agreement; although in cases where buyer and seller agree not to use a lawyer then a template can be used. However, not using a lawyer is not advised and can lead to extended complications in the event of arbitration.
Once the sales and purchase agreement is produced the buyer has recourse to hiring a lawyer to review the contract and propose any amendments deemed necessary. Apart from a contract review, other property-related services lawyers can provide are a background check in to the developer and due diligence in relation to the land title deed.
The fee lawyers charge depends on the size of property and services required but a good rule of thumb is 1% of the property value.
Some lawyers will include a number of contract amendments in their fee and others may charge an additional hourly rate for amendments.
“Real estate cannot be lost or stolen, nor can it be carried away. Purchased with common sense, paid for in full and managed with reasonable care, it is about the safest investment in the world.”
- Franklin D Roosevelt