If you come to Thailand every year to spend the winter, isn’t it time to think about buying flats in Thailand for expats? It is pretty easy and inexpensive to do this. Besides, you will get many advantages and excellent bonuses.
Types of property in Thailand
First, you must decide on the property type you want to purchase. There are complexities and subtleties here.
- Condo apartment. A condominium is a company-operated apartment building, often with a pool, parking, and security. In Thailand, there is a special “farang quota”, according to which only 49% of the housing in each condo can be sold to foreigners. If you buy a home on this quota, you are registered as the property owner. It is only possible to transfer into ownership an apartment that is included in the foreign percentage. If you want to avoid living in a crowded city, you can immediately ignore the condo – this type of housing is not built in non-tourist places.
- House or villa. When you buy a house, you naturally have to buy land. The problem is that the latter is prohibited in Thailand. But do not despair because there are long-established schemes to circumvent the law legally. To do this, a foreigner must register his company in Thailand and purchase real estate for a Thai legal entity. The main thing is to own 49% of the shares and be a company director with a decisive right to dispose of the property. Another option is a long-term land lease, for example, for 90 years. But remember that such a lease is often 20-30% more expensive than a purchase (in terms of 90 years).
Primary or secondary market?
The construction of buildings according to modern standards in Thailand began only 5-7 years ago, so it is believed that the best value for money can only be found in the primary market. When buying a home from a developer, opening your account with a local bank is unnecessary because all payments are transferred directly to the developer’s account. The price of finished apartments is usually 30-45% higher. In addition, in such a transaction, you must pay a tax on the transfer of ownership (6.3%) and other costs associated with the sale.
In the best areas of Bangkok, a square meter of land costs 5-6 million baht. Even the UK considered it not shameful to sell the garden of its embassy into a shopping center at a price of 5.2 million baht per square meter.
The cheapest housing in the resorts is studios in a condo with an area of about 45 square meters. You can buy them for $30,000. For $70,000-100,000, you can buy better objects. Prices in Pattaya are usually twice as low as on the islands because it is cheaper to deliver building materials here, and more space suitable for building.
When buying and selling housing, the Thais will require you to pay land registration tax (2% of the site’s assessed value) and stamp duty (0.5%). However, the latter is canceled unless a business tax (3.3%) is payable: it is paid by someone who sells his house less than 5 years after buying it. Another tax is income tax (from 1% to 3%).
Owning an apartment in Thailand, you must pay monthly for security services, garbage collection, external lighting, pool and fitness center maintenance, parking, elevator, golf cart, electrician, and plumber on duty. Utility bills can be 30-50 baht per square meter of housing area. Electricity and water are metered and cost approximately 3.75 baht per kilowatt and 25 baht per cubic meter. A family with one child pays about 800 to 1400 baht per month.
Buying property in Thailand in his name, a foreigner receives an official document, “Chanot”. It guarantees the unconditional right to own, sell and inherit the acquired apartment. The names of the heirs must be written in Chanot. Also, in this document, the amount of the rent will be immediately fixed.
Buying real estate does not provide visa benefits, but it makes obtaining any visa for permanent residence easier. If you own property in Thailand, you can stay there for as long as you like without restrictions on entry into the country.
Acquired housing can be rented out, and the yield is no more than 5-6% per annum.
The easiest way is to hire a real estate agency, draw up a trust management agreement and leave the search for tenants to realtors. If you want to avoid dealing with intermediaries, you can do what the locals do: place an ad for renting your property right in front of the house and wait for customers.
Who can help with the deal?
Thailand-Real.Estate is an aggregator website where you can search for various types of property in Thailand, compare the prices, and select the best dream option.