What is an ideal transaction? The buyer and seller agree on the price, payment terms, and the date for transferring ownership at the Land Department. Everything seems smooth—so where do unexpected issues come from? Additional costs, delayed documents, incorrectly prepared paperwork… These issues arise quite often. This article will help you complete a real estate transaction smoothly—and maybe even enjoy the process.
Thai and Foreign Quotas
A condominium unit is the only type of real estate in Thailand that a foreigner can own outright. However, this applies to only 49% of the total condominium area; the remaining 51% must belong to Thai nationals.
The first question before purchase: is the unit under the foreign or Thai quota?
- If the seller is a foreigner, it is most likely already in the foreign quota.
- If the seller is Thai but claims it is under the foreign quota, this must be verified with the condominium administration.
If the unit is not in the foreign quota, you may need to register a Thai company to purchase it or look for another property.
Chanote: Reading Between the Lines
First, verify all key details: condominium name, unit number, size, ownership, and how long the current owner has held the property.
This is important for tax calculation:
- Less than 5 years of ownership → taxes and fees ≈ 6.3%
- More than 5 years → ≈ 3.5%
Mortgaged Property
A mortgage often worries buyers, but it simply means a third party (usually a bank) is involved. In most cases, the bank will agree to the sale if part of the payment goes toward repaying the loan.
Always verify the details before making assumptions.
Certificate of No Debt
You need a certificate confirming no outstanding payments to the condominium.
While easy to request, it may take time to obtain—especially if the responsible officer is unavailable. Normally it takes about a week, but delays can extend it to two or three weeks. Plan ahead.
Opening a Bank Account
Is it necessary to transfer money from abroad and open a local account? Yes.
Thai law requires proof that funds for purchasing a condominium were transferred from abroad. This document is called Tor Tor 3 (Foreign Exchange Transaction Form).
The simplest method:
- Open a bank account in Thailand
- Transfer funds from your foreign account
- Inform the bank that the transfer is for condominium purchase
Without this document, the transaction cannot be registered at the Land Department.
Sale and Purchase Agreement
Many are surprised that the initial agreement can be a simple written document without notarization.
However:
- If the transaction takes time (deposit, bank transfer, etc.), a written agreement signed by two witnesses is recommended
- It becomes legally binding and may include penalties for breach
At the time of registration, an official Thai-language agreement will be issued and signed regardless of any prior agreement.
Remote Transactions
Can you buy or sell without being in Thailand? Yes, in two cases:
Option 1:
You were in Thailand, signed documents, but left before registration.
- Leave a power of attorney (Thai format only)
- Provide passport copies with a valid visa
- Transaction must be completed before visa expiration
Option 2:
You complete everything remotely.
- Power of attorney must be notarized at a Thai consulate abroad
- In practice, acceptance depends on the consulate
Payments
Typically, payments occur in two stages:
- Deposit upon signing the agreement
- Final payment at ownership transfer
Instead of carrying cash, a bank cheque payable to the seller is recommended.
A trusted third party (often a lawyer) can act as document holder:
- Seller provides the chanote
- Buyer provides the cheque
- Lawyer completes registration and exchanges documents
Registration
The transaction is registered at the Land Department in one day.
- The new owner’s name is entered into the chanote
- The document itself remains the same
- The official sale agreement is attached
Practical Tip
If you plan multiple transactions in Thailand, translate your passport into Thai and notarize it. This ensures consistent spelling of your name across all documents and helps you verify it yourself.
Will
It is strongly recommended to prepare a will in Thailand covering all assets (real estate, funds, rights, etc.).
It’s better to have a will and not need it than the opposite.
Author: Alexandra Agapitova.
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