CHECKLIST FOR BUYING A CONDO IN THAILAND

1

Check all the costs related to the purchase => Mandatory

A/ Conveyance taxes: are they included in the asking price? (Cf. PROPERTY TAX REGIME IN THAILAND) B/ Commission: is the agent fee included in the asking price? (the commission is generally paid by the seller)

2

Check the condominium (residence) => Mandatory

A/ Cost of utilities (electricity, water, etc.): based on an average normal consumption of former residents B/ Common fees: fees due by every co-owner of a condominium for the maintenance and management of the residence. They are determined on a monthly basis and generally comprised between 40 and 80 THB / sq.m. / month C/ Legal status of the residence: is it registered and licensed as a condominium? D/ Internal rules of the condominium E/ Financial statements and sinking fund of the condominium

3

Check the title deed => Mandatory

This is the “ID” of the property, the only official ownership document. There are always 2 identical copies: o 1 is held by the land department (the public authority in charge of property ownerships), o 1 is held by the owner => Investors need to review the title deed held by the seller (the land department won’t release it to avoid loss or dispute) => Notary service is not mandatory for property transactions in Thailand, it is therefore advised to hire a lawyer for the due diligence The back-side of the deed details the changes of ownership and potential liabilities and mortgages on the property

4

Sign a Memorandum of Understanding (MoU) => Optional

This document contains the most important details of the transaction. Signing a MoU can be a useful step in case the buyer wants to secure the unit quickly before the SPA (see below) is signed.

5

Sign the Sale and Purchase Agreement (SPA) => Mandatory

This document is the only necessary document to carry out the purchase/sale of a condominium unit It comprises all the details of o the property o the seller o the buyer o the terms and conditions of the transaction It is usually recommended to hire a law firm for the draft and/or review of the SPA The signing of the SPA is immediately followed by a financial commitment of generally 10% of the agreed purchase price (the “security deposit”) After the signing, the time generally agreed to transfer the property at the land department – and pay the outstanding amount due – is 1 to 2 months

6

Conduct technical inspections => Recommended

The buyer may ask technicians/architects to inspect the quality of the unit between the signing date of the SPA and the transfer date In case there are structural defects in the unit, the buyer could decide not to transfer the property and claim a refund of the security deposit. This needs to be specified in the SPA to avoid any dispute with the seller

7

Transfer the condominium unit => Mandatory

The buyer and the seller or their representatives meet at the land department with their agent and/or lawyer on the date agreed on the SPA The buyer is usually requested to bring 3 cheques (cashier cheques only, i.e. verified by the bank): o 1 for the seller corresponding to the outstanding amount on the sale (minus the tax and the commission) o 1 for the land department corresponding to the tax due by the seller o 1 for the agent corresponding to the commission fee due by the seller The whole process at the land department usually takes a few hours only

8

Register the condominium unit in the "yellow book" => Recommended

This process takes place at the district office, and . By doing so foreign buyers declare that the property is their first home in Thailand Allows to cut the special business tax after only 1 year of ownership (instead of 5 years if not registered)