Here is an example of
standard Property Legal Services offered:
- The lawyer will conduct a Due
Diligence Search on the land with the title deed at
the Land Department to check status of properties,
legal ownership, lien or encumbrance, or mortgage,
and report findings
- Prepare a draft and review Sales
and Purchase Agreement in Thai and English
- Negotiate, revise, finalize the
sales agreements if necessary and assist with international
money remittance such as obtaining Foreign Exchange
Transaction form (Tor Tor 3)
- Register the title deed and ownership transfer at the Land Department
They should also provide you contracts and agreements in both English and Thai
languages.
Four options worth considering when buying property and using a independent reputable law firm to advise you.
Freehold ownership -condominiums
In a condo building a foreigner
can own 49% freehold of the total floor area. example 49 out of 100 units for sale in a building can be owned by foreigners. Or buyers can lease or use a Thai company. After the condo has been registered the condominium juristic body (all the co owners) own and have interest in the land and common areas.Each owner will receive a unit Title or detail on the land Title. Foreigners only have to purchase the condo in foreign currency T/T by bank from a overseas bank account and collect a FET Form (Tor Tor 3 ) to show as proof.
Leasehold
A leasehold agreement is fairly easy to
set up. The land, with or without property, can be leased
for 30 years maximum, some agents and sellers say they can renew
or extend the lease period for you such as renewable 30+30+30 years. However you need to
consult a Law firm about this practice as current laws
do not ensure this extension can be enforced. However this can be set up with ensurances just as good as Freehold. Please
note that leases of more than 3 years are required to be
registered with the Land Department, and these can be set up for leasing land on which to build properties, such as villas or houses.
Freehold ownership of land with a Thai registered company
This practice is slowly being fazed out by the government who are trying to create a safer and clearer guidelines for buyers. However it is still the most common way foreigners will purchase property as this offers more flexibility than leases becauseof finance and resale advantages. If the Thai company is correctly set up with foreigners not owning more than a max 49% however 39% has been suggested and the process has been structured with real/genuine Thai shareholders who can prove they have invested then this is still a legal method. Owning a registered company in Thailand does bare certain responsibilities such
as filing an annual tax return. Normally if the company was only set up for land
investment then a minimal annual auditing fee is paid to an accounting
firm who will submit your annual fiscal report. There are advantages
to having a Thai registered company as you can apply for a work permit,
apply for a 1 year working visa, register vehicles, and apply for loans
and finance.
Our suggestion to you is to use the service of a reputable
independent law firm about the above options. They
will advise you on all requirements and procedures related to real estate in Thailand. We
can recommend some law firms which have no commercial interest in the Koh Samui
and Phangan property markets. It is important
for you to get the correct advice about the law
ruling these important issues.
Please see link to a reputable Independent Law Firm Thailand koh samui law firm - Crawshaws or we can help you find a law firm with no interest in Thailand real estate or biased opinions and of course 100% idependent from us.
Other Real etsate legal info
Marrying a Thai spouse
The law also allows for a Thai person with a foreign spouse to buy land
or properties in Thailand. Before registering the land at the Land Department,
the couple may be asked to sign declarations, that the funds
for the property came solely from the Thai spouse. This will in effect,
result in the foreign spouse waiving his/her rights on any real estate.
Such declarations may become problematic in a divorce case as the foreign
spouse may have difficulty proving that the land was marital property.
To prepare for such an event, a skillfully-drafted pre-nuptial agreement
or loan agreement may be useful.
Investing/BOI
With significant investment of funds, foreigners may be allowed to own
a limited amount of land under the property law of Thailand. Some foreign companies
seek and obtain the approval of the Board of Investment (BOI) to purchase
land for a limited period. This option, however, is not available to
the vast majority of foreign nationals seeking to obtain a second or retirement home,
villa or investment in real estate because of the legal restrictions
involved. As a result, other options must be examined.
Issues related to American citizens
An American can own 100 per cent of a company registered in Thailand under the
Amity Treaty. However this does not enable Americans to use an Amity
Treaty company to buy land or properties.
Land Title Deeds
Below are the main types of land documents or title deeds you may come across which are classed as rights of possession or rights of ownership. We recommend that you acquire land that gives you rights of ownership as there are certain advantages. These include that the land can be sub-divided into smaller plots.
For example, you may want to start an environmentally friendly Koh Samui villa project. However planning permission has to be applied for that will conform to the new zoning laws introduced to handle the growing Samui property market. And the other advantage to a rights of possession land document allows any such legal acts to be carried out immediately on the land.
NOR SOR 4 JOR (Chanote)
Titles
are issued by the Land Department and accurately surveyed and
plotted using GPS technology in relation to the national survey
grid. They are also marked by unique numbered posts set in the
ground. This is usually the most sought after title, especially
for first time foreign investors Thailand real estate. However we also strongly
recommend other titles such as the Nor Sor 3 Gor and the older
Nor Sor 3.
NOR SOR 3 GOR
These titles
are less accurately measured and surveyed. Parcel points
are used according to an aerial survey to set the points
and land area. A scale of 1:5,000 is used, as with
the Chanote Title. The boundaries are recorded in relation
to neighbouring plots and, as with the Chanote, it is possible
to sub-divide the land.
NOR SOR 3
This is
an older title and, unlike the Nor Sor 3
Gor title, is less accurately surveyed as
no parcel points are used, only a floating
map. This can cause problems with verifying
the land area and size.
Rights of Possession
Two of the main title deeds in
this category are Sor
Kor 1 and Por
Tor Bor 5.
These titles are basically possession rights and are generally used for
farming in Samui and Phangan.
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