Your questions answered, your worries relieved
Yes! In buildings classed as condominiums, developers are allowed to sell up to 49% of the total apartments to foreigners on a freehold basis. The other 51% must be sold to either Thai citizens or Thai companies, of which foreigners can own a maximum of 49% of the shares. This is why you will find different prices or payment terms listed for each project depending on whether the apartment is being bought under ‘Foreign Ownership’ or ‘Thai Company Ownership’.
For off-plan property, there are three taxes payable to the Land Department when the property is registered in your name. These are a Transfer Fee of 2%, a Special Business Tax of 3.3%, and a Stamp Duty of 0.5% – so the total taxes are 6.3%. The taxes are split between the buyer and seller. Each major developer splits the taxes differently, so the actual taxes that the buyer pays can vary from a minimum of 1% up to a maximum of 6.3% depending upon the individual development. These percentages are based on the appraised value of the property, which is usually a little lower than the purchase price which is paid. These taxes are not due until the official registration of the property, which tends to take place around 3-6 months following the handover of the property. After you have purchased the property, there are no annual property taxes payable in Thailand. Your only additional costs after purchasing will be the maintenance fees charged for the upkeep of the building and any utilities that you use (e.g. water and electricity).
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One of the conditions of buying an apartment under foreign ownership is that all funds must originate from outside Thailand and must be sent in a currency other than THB (i.e. sent in USD, GBP, EUR, AUD, etc.). Most buyers send payment from their bank accounts in their home country by making an international wire transfer directly into the account of the developer. It does not matter which currency funds are sent in as they will be converted to Thai Baht upon arrival in the country. It is also possible for foreigners to open bank accounts in Thailand. If you would prefer to deposit funds into a Thai bank account first, you will need the bank to arrange a document providing that the funds originated from outside the country and that they are being used for the purchase of real estate.
A Sinking Fund is a one-time payment that is used as an emergency fund for any one-off repairs or improvements that may be required for the development at some time in the future (e.g. repainting the exterior every few years). Payment for the Sinking Fund must be made at the time that the buyer receives delivery of the apartment. The cost of the Sinking Fund depends upon the size of the apartment and so the price is quoted per square meter. Maintenance Fees are payments required for the day-to-day running of the project (e.g. salaries for security, the receptionist and cleaners; upkeep of swimming pools; electricity for the lifts, etc.) As with the Sinking Fund, it is based upon the size of each apartment in square meters and the price quoted is for the monthly fee. Most developers require a full year’s payment of maintenance fees in advance once the apartment is handed over and then to be paid annually in advance thereafter.
Yes! Our company offers buyers a full rental service for investors. We can handle all aspects of renting the property on your behalf, overseeing the property, and sending you the rental revenues to a bank account of your choosing. Royal Lee Phuket has a constant demand from tenants looking for properties to rent all over the city and at all different price ranges and so occupancy levels of the properties that we manage are always high.
