If you wish to invest in property or buy real estate in Thailand, you need to consult with a lawyer. You should never make an investment or purchase real estate without an experienced attorney at your side. Doing so can lead to some legal and financial problems – problems that could have been avoided by consulting with an attorney.
While you can find some excellent real estate investments and purchases in Thailand, you still need to make sure you legally comply with the law. That means you need to conduct a thorough search of a property’s title as well as perform due diligence. Review your contract with a lawyer before you initiate a title transfer.
As a foreigner, you can undertake the following transactions when you are purchasing real estate:
You can get the best deal for a condominium purchase if you contact a professional property lawyer. If you are a foreigner, you can own a condo. However, you have to be aware of some of the restrictions in place. A foreigner can only own 49% of the space allocated for units in a project.
If you would like to lease land in Thailand, you can learn more about the process through a knowledgeable legal advisor. If you are a foreigner, you probably have a number of questions to ask. For example, the information below will give you more insight.
If you are a foreigner, you can receive 100% interest for land that is leased. Unlike owning land directly, you can receive 100% ownership for leases that are long-term. If you lease land for up to three years, you do not have to register the lease at the Land Office. However, longer-term leases must be registered.
Because the law in Thailand will not permit a foreigner to own houses and land, many foreigners choose to acquire a land lease for 30 years with an alternative to extending the terms. This is the most straightforward method of obtaining real estate in Thailand. Therefore, a foreigner’s lease right is recognized, by law, in Thailand. A land lease is therefore executed and registered one time. Little maintenance is needed for this type of transaction.
Otherwise, you will need to form a limited company, which has several shareholders. By establishing a company, you will need to follow certain regulatory compliances, such as filing of annual balance sheets.
As noted, as a foreigner, you need to register a Thai company to own land in Thailand. A foreigner cannot own land in his or her name. Once the limited company is registered, you can purchase real estate.
To make a land or condominium purchase, you need to make sure you follow certain measures to ensure that you buy a property free and clear of encumbrances. The following legal services are provided by Thai attorneys.
When conducting a title search for a condominium, the Chanote deed allows both possession and ownership rights. The Nor Sor 3 (Sam) Gor is considered second best, as it is recorded with aerial photography.
While the Nor Sor 3 (Sam) Gor only allows possession, it can be made into Chanote at the land office. The Nor Sor 3 (Sam) deed, part of the old system, was replaced by the aforementioned Nor Sor 3 (Sam) Gor. The deed must be made into a Nor Sor 3 (Sam) Gor before it can be made into Chanote.
The Tor Tor 3 (Sam) indicates that squatter’s rights apply. Therefore, it cannot be sold by the land office – but only between individuals.
In Thailand, the Chanote is the best deed to possess, as you have more room to negotiate or conduct real estate transactions. The Chanote permits the holder to fully survey a property, sell it, or pass it on to heirs – all the advantages enjoyed by people who possess title deeds.
If a title search uncovers that a deed is Chanote, the property must be used by a squatter for 10 years for the squatter to possess the property – not one year, as is required in other deeds. As long as the Chanote holder uses the property within a 10-year-period, his or her ownership will remain in force.
The Tor Tor 3 (Sam) should not be considered if you run across this deed on a title search, and are a foreign investor. This deed is also associated with squatter’s rights land, as the owner does not have as much control in this respect.
You should always have a title search performed on a condominium or land purchase, as doing so will ensure your rights and make your transaction easier. Confer with a lawyer who can help you get the information you need to proceed with a purchase. Make sure you always perform a title search on any Thai real estate.
To investigate the property further, you also need to perform due diligence. Doing so will help you ascertain whether or not the title document is correct. You will also want to add this task to learn if the seller of the property is its current owner.
Conducting due diligence also enables you to check encumbrances or the lack of a mortgage. Make sure to note if any legal actions have been conducted against the seller in the Central Bankruptcy court or a local court. You should also do due diligence to confirm any restrictions on development.
You will also need a lawyer to draft your sale and purchase agreement and to review the document if you are purchasing real estate. This will enable you to verify the terms of the sale and provide specific comments on clauses. You can also negotiate any modifications, if applicable.
When your lawyer transfers the property title to you, as the buyer, he or she will first prepare the application and supporting documents. This is done to register the title and transfer of ownership. This is a nice and easy way to transact real estate purchases if you are a foreign investor. The lawyer registers the transfer of ownership, on your behalf, at the Land Office in Thailand, which frees you up to focus on investing.
If you need legal advice or assistance from a qualified property lawyer, please contact us today.