Thailand Real Estate: Pattaya, Rayong, Hua Hin Property — Condo, Houses, Homes For Sale
It is possible to buy several types of property in Thailand nowadays:
The foreigner can buy only an apartment in condominium to own it personally. Moreover, this flat must be in "international quota". According to Thailand laws not more than 49% of living space in any building recognized as condominium can be sold to ownership of foreign residents. The other 51 % of living space can be sold to Thailand citizens or companies which are registered on the territory of Thailand only. This scheme also works for purchasing land, houses and townhouses. Everything that is situated directly on the land can be bought onе the name of a Thai company. In both cases the purchase is registered with the right of ownership. In case a condo from the international quota is bought, a private person will be the owner. If a piece of land, a house or a condo from Thai quota are sold, the ownership will belong to a Thai company which is de facto administrated by a foreigner. Our company provides a full service for deals with condominiums, houses and townhouses. There are most frequently asked questions of people who want to buy property in the name of Thai company and answer to them.
What is the procedure of buying property on a Thai company name?
It is necessary to register in Thailand a legal body and 51% of its shares must belong to citizens of the Kingdom. The foreigner who wants to buy property can hold 49% of shares. The documents are registered in the way that the Thai share-holders are active only on paper and the foreign director totally controls the created body. This method has been working for more than 30 years already, so the procedure of purchasing property in the name of a Thai company is ideally worked out and there is no danger for foreigners.
The purchase is registered with the right of ownership of Thai company. It means that a land or an apartment belongs to the firm which is possessed by the foreigner.
What are the advantages and disadvantages of buying an apartment in the name of a Thai company?
The advantages are the following:
1. The price in THB is lower than the prices in international currency and this rule is true for about 75% of deals. The spread can vary from 2-3% up to 20%.
2. It is possible to buy many apartments in the name of one Thai company, as many as you wish. It is very profitable for you if you plan to buy several condos and then rent them out. The price of the condo doesn`t depend on the name or the status of the holder. Moreover, you have an opportunity to move to Thailand in order to administrate your property. In this case you will obtain a long-term visa and work permit.
3. If you buy property on a Thai company name you don`t have to provide the document showing that the money were brought from another country. That means that you can use any method of payment which is convenient for you. You can use your off-shores, credit cards or even cash.
The disadvantage of the deal are:
1. Some extra spendings. The registration of the company is Thailand costs 30000 THB or more and its annual supporting requests 12000 -15000 THB.
2. The liquidity of a condo which is possessed by a Thai company is a little lower than the liquidity of the same apartment which is owned by a foreign citizen. It means that it will be harder to sell the first condo and the price for this condo must be a bit lower.
Are there any other options to buy a house except the opportunity to purchase it in the name of a Thai company?
Technically there are two ways to buy a house or a townhouse. The main scheme is based on purchasing them on a Thai company name. But there is an alternative option - to sign a contract of a long-term rent for 30 years. The second variant is rarely used in Pattaya. There is a great difference between these two options. When the buyer of a house with territory is a Thai company, it has a full right of ownership and the company is administrated by the buyer. If you rent your property even for a long term, this house doesn`t belong to you and you don`t have ownership. Usually, the renter has a priority right to sign a new contract of rent for the next 30 years when the first period has finished. But the owner is not obliged to prolong your contract. So, these rental agreement is worth to be signed only in case you can`t buy the property in the name of a Thai company, for example, if you buy it on Phuket.
Is it possible to buy a house, a townhouse, a condo in the name of a company from other country (Germany, France, Australia and etc.)?
No, this option doesn`t correlate with the legislation. The company must be registered on the territory of the Kingdom of Thailand.
I really liked the project A but the international quota has finished there. Can I buy an apartment from the Thai quota?
Yes, it can be done. In this case if the foreigner wants to buy a condo in a new building from the Tai quota, it is necessary to sign a contract with the developer. At the beginning the contract will be registered in the name of the buyer. This agreement must contain the condition that the buyer is obliged to register the finished condo in the name of a Thai company. The title of this company is also mentioned in the agreement. According to this scheme a new company can be registered when the condominium is ready to move in.
How to sell a house, a piece of land, a condo if they are registered in the name of a Thai company?
The easiest way which allows not to pay more taxes is to sell your property together with the company which it was registered for. In this case at first you have to change the list of the shareholders and to write a new owner there instead of you. Then the new owner is appointed to be the director of the company. The deal is ready on this step.
How to buy a condo in the name of a Thai company from the pre-owned market?
There are several opportunities. Usually the owner sells the flat together with the company which possesses this property. In this case the buyer should register 49% of the shares for him or her name, entitle him or herself as a director and take all the original documents of the company. Before the moment of payment it is important to check financial security of the company, for example, it must not have any debts or unpaid invoices. The main idea that you shouldn`t pay any taxes because the flat isn`t sold de jure and remains in property of the same company. In practice the owner of company changes and the flat belongs to him or her together with the company.
The second option is based on registration of the company in the name of a new company. It is necessary if you buy a finished flat from the Thailand citizen. Also it is important if the former owner is the foreigner and doesn`t want to sell the flat together together with the company. In this case you will have to pay extra fees and taxes which usually compose 3-4% from the price of the flat. The scheme of payments is installed individually with the buyer. In addition to this you should pay for the registration of a new company and the minimum cost of this deal is 30000 THB.
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