Due to its ever-increasing tourism, Thailand remains one of the most popular locations for real estate investment. Purchasing a condominium in Thailand is therefore a trend among many foreigners. Although Thai real estate law generally prohibits foreigners from acquiring property in Thailand, there are legal ways to purchase a condominium, as the Condominium Act has less stringent nationality restrictions regarding ownership and other aspects.

What is a condominium in Thailand?

A condominium, usually short for "condominium," is a type of real estate divided into multiple residential units, each individually owned. Condominiums are also sometimes built as apartment complexes, but unlike rental apartments, the individual units are wholly owned by their respective owners. Furthermore, the individual apartment owners typically also own the building's common areas, such as hallways, walkways, swimming pools, fitness rooms, laundry rooms, etc., as well as shared facilities and amenities, such as elevators. The distinction between a condominium and an apartment complex is purely legal.

Differences in residential buildings in Thailand

In Thailand, there are two types of residential buildings: condominiums (condos) that are approved under the Condominium Ownership Act, and unregistered or unapproved rental apartments. Only condominiums registered under this law and recorded with the Land Registry grant full individual ownership with a title deed issued by the state. The Condominium Ownership Act defines, for example, the procedure and criteria for approving a multi-family building as a condominium.

When buying a condominium in Thailand, location plays a crucial role. From the vibrant metropolis of Bangkok to Phuket, there are numerous opportunities throughout Thailand to find the perfect apartment. Apartments are available in almost every city, but a few areas are particularly popular with foreigners.

The process of buying a condominium in Thailand

There are no nationality restrictions, and any foreigner legally permitted to enter Thailand can purchase a condominium, which is typically outright owned. Buying a condominium in Thailand is quite straightforward, and only a few requirements need to be met:

  • The purchased property must be within the 49% of the project's area designated for foreigners. This can be easily verified directly at the developer's office with the responsible legal entity. Section 19 of the Condominium Ownership Act governs foreign ownership and limits it to 49% of the total area of ​​all residential units in a building. Foreigners purchasing a condominium in Thailand must therefore carefully check whether foreign ownership is permitted in the building in question.
  • According to the Condominium Ownership Act, the project must be registered. This will be quickly verified at the land registry office.
  • The purchase of the condominium must be made with money transferred from abroad to Thailand. This means the money must come from your foreign bank account and be converted into Thai Baht. You will need an official bank statement (Foreign Exchange Transaction Form, FET form). Without this document, you cannot register as a co-owner of the condominium complex.

    • Why is the FET shape necessary?

    FET stands for Foreign Exchange Transaction (formerly Thor Thor 3). The FET form is required for property registration with the Land Registry. Authorized financial institutions in Thailand that process foreign exchange transactions exceeding US$50,000 (or the equivalent in another currency) must complete an FET form and report this transaction to the Bank of Thailand (BOI) in accordance with its banking regulations. When a foreigner purchases a condominium, the original of this form, which lists the foreigner's name as the recipient or sender of the foreign currency, serves as proof of property registration with the Land Registry and demonstrates the foreigner's compliance with Section 19 of the Condominium Ownership Act.

    Foreigners who are entitled to ownership

    The following foreigners are entitled to acquire property in Thailand:

  • Foreigners are permitted to stay in Thailand according to the Thai Immigration Act;
  • Foreigners who are permitted to come to Thailand under the Investment Promotion Act;
  • Legal persons as defined in sections 97 and 98 of the Land Act, who are registered as legal persons under Thai law;
  • Companies as defined in Section 4 of the Foreign Business Act that have obtained a foreign business license;
  • Foreigners or legitimate legal persons who are considered foreign under the law and who entered Thailand in foreign currency and exchanged and withdrew Thai Baht from a Thai Baht account or a foreign currency account.

    • Do I need a purchase contract?

    The purchase agreement, the most important element when buying a condominium in Thailand, must be carefully planned by foreigners. This contract governs the interests of both the seller and the buyer and serves to clarify all details before the contract is signed. The contract must be legally compliant and offer the buyer protection. In the case of a private resale of a condominium or a leasehold, the contracts are subject to general contract law, and the parties can agree on various terms that may benefit one party more than the other.

    Many prospective homebuyers in Thailand seek legal advice before finalizing a purchase. Lawyers can clarify the legal aspects of the purchase and review the sales contract.

    Other points to consider

    When buying a condominium in Thailand, it's important to note that a Thai purchase contract is signed during the transfer of ownership and registration at the Land Registry. This does not affect the private agreement between you and the seller. You will also need to pay fees, which may include transfer fees, customs duties, or taxes. These costs can be split between the buyer and seller or according to an agreement between the parties. According to consumer protection regulations, if the purchase is made directly by the developer, they may charge the buyer a maximum of half of the 2% transfer fee, but no more. All other costs are borne by the developer.

    Thai real estate lawyer

    Siam Legal International is a law firm in Thailand offering a range of services to protect the rights and interests of foreigners wishing to purchase real estate in Thailand. Our firm provides a comprehensive suite of real estate-related services to best meet the needs of both our foreign and Thai clients. Should you have any questions or concerns regarding real estate, our team of Thai real estate lawyers invites you to contact us via the link below: