Steps to Purchasing an Apartment from a Developer

So, you’ve decided to buy buying property in Thailand directly from a developer. What steps lie ahead?

  1. Deposit Payment: The first step is paying a deposit to confirm your serious intentions. For the developer, this acts as a safety net in case you back out of the deal. Typically, the deposit does not exceed 100,000 baht. At this stage, a deposit agreement is signed, requiring only the buyer’s passport. The developer can usually prepare this agreement in the buyer’s presence, taking about an hour. In rare cases, the developer might ask the buyer to return for signing in 1-2 days.
  2. Sales and Purchase Agreement: Once the deposit is paid, the sales and purchase agreement is drawn up. The duration of this process depends on the developer’s internal procedures and usually takes no more than a month, with an average of 14-21 days. If the buyer is outside Thailand when the agreement is ready, an additional 2-3 days may be needed for DHL shipping.
  3. First Payment: Along with signing the contract, the buyer makes the first payment according to the payment schedule.
  4. Ownership Transfer: Once the property is completed, the developer will handle the transfer of ownership to the buyer. This process involves the Land and Architectural Committees in Thailand, and the developer manages all the necessary steps on your behalf.
  5. Finalizing Ownership: As soon as the developer obtains all the documents confirming your ownership, you officially become the owner of the property in Thailand.Timeline: The procedure typically takes 10 days to 1.5 months, plus construction time if it’s an off-plan project.Required Documents: A certified copy of the buyer’s passport.

Steps to Purchasing a Property on the Secondary Market

Now, let’s consider the second option: purchasing a property on the secondary market. The steps are generally similar to buying from a developer, but with some nuances.

  1. Negotiating the Agreement: Unlike with a developer, where you sign a standard sales contract, purchasing on the secondary market begins with negotiating the contract terms with the seller. Important details like price and deposit are discussed at this stage.Important Note: Carefully review all contract terms and, if necessary, make amendments. If the transaction involves our company, we always involve a lawyer to minimize risks.
  2. Cost Sharing: Be aware that the costs of processing the transaction are typically shared between the buyer and the seller.Timeline: On average, the process takes about 2 months.Required Documents: A certified copy of the buyer’s passport. In some cases, a Foreign Exchange Transaction (FET) form may also be required to confirm the exchange of foreign currency into Thai baht.

Steps to buying property in Thailand – House, Villa, or Townhouse

Purchasing a house, villa, or townhouse in Thailand involves two key processes: registering the land and the building. The building is usually registered under full ownership, similar to buying an apartment. The land, however, can be acquired through the following methods:

  1. Leasehold: The land is leased for a long-term period.
    • Both you and the landowner sign a standard application form in Thai at the Land Department, in the presence of a competent land official.After 1-1.5 months, you revisit the Land Department to complete the transfer of rights. A standard lease agreement in Thai is issued at this stage.You officially become the tenant for the first lease term, usually 30 years, with the option to renew twice for a total of 90 years. After this, the land must be re-registered to another person.
    Timeline: About 2-3 months.
  2. Freehold: Ownership through establishing a Thai company.
    • You register a company in Thailand with a capital of $500-$3,000, which becomes the landowner. The required document is your passport.
    • Since foreigners can own no more than 49% of the company’s shares, these are issued in your name, while the remaining 51% are held by nominal Thai shareholders. These shareholders typically provide a package of documents, including a power of attorney and share transfer forms, giving you de facto control over the company.
    • The cost of maintaining such a nominal company is around $1,000 per year.
    • The process of registering the company takes about 2-3 weeks. After that, the property transfer process from the seller to the new buyer (through the company) begins, which takes an additional 1-1.5 months.
  3. Mixed Ownership: Common in luxury villa complexes, where the entire land is owned by a Thai company, and homeowners hold a share in an offshore company that owns a minor stake in the Thai company.Timeline: 2-3 months on average.Required Documents: A certified copy of your passport.

Legal Assistance

To safeguard against errors when purchasing real estate in Thailand, consider seeking help from an experienced lawyer. We are happy to assist in finding a trusted specialist and supporting you through all stages of the transaction.