Bangkok Post: Property Focus - 30Oct
2012
What
You need to know about buying condo in Thailand
In the
Bangkok, Phuket property Market, Condominiums are becoming more popular,
especially after last year flooding. Before buying condominium there are several
issues to consider, some specific either to Thai or Foreigner buyers, some
common to both.
Ownership
Under
the Thai Condominium Act, the owners of each condominium unit own that unit as
their personal property, and also jointly own (along with the other owners of
units in that development) the common property of the condominium development.
This joint ownership is in proportion to the ratio between the area of each
condominium unit and the total area of all units in the development the common
property includes the land, where the development is located, structures for
stability and prevention of damage, the buildings and parts thereof, and
equipment provided for mutual usage or benefit.
Trading
area
Many
modern condominium developments have areas in which entrepreneurs can trade,
although this trading may disturb residents (the joint owners or renting
tenants) According to the Act, trading is prohibited in condominium
developments, except in designated areas.
If
trading is allowed, access to these areas must be designed so as to prevent
disturbance to residents.
Management
Each
condominium must have a condominium juristic person registered with the Land
office. The joint owners appoint a juristic person committee to control the
condominium juristic person to manage and maintain the common property for
their collective benefit, expenses, taxes and duties.
The
joint owners are jointly liable to pay.
1
Expenses arising from common services and maintenance of the common property.
2 Taxes
and duties corresponding to the proportion of their ownership of the common
property. If the joint owners fail to pay, problems will occur should they wish
to resister the sale or transfer of their condominium unit, as the land office
will not proceed with the registration unless the unit is free from
liabilities.
Agreements
Agreements
to sale and purchase condominium units must be in the form prescribed by the
notification of the ministry of interior issued under the Act. The major terms
and conditions that must be contained in such agreements include the details of
the unit, the agreed purchase price and payment process and payment and interest,
termination of the agreement, and liability for damage caused by defects, If
the agreement is not as prescribed, the seller could be liable for fines not exceeding
100,000 baht.
Further
the consumer Protection Act, applies to agreements to sale and purchase
condominium. As the developer of the condominiums is a business area subject to
contract controls. Unfair terms and conditions, including waivers or limitations
of the seller’s liability for defects, are also prohibited.
Advertisements
Advertisements,
in any form, for the sale of condominium units, including statements, pictures,
letters in inducing the purchase of condominiums and brochures are deemed incorporated
in any subsequent agreement to sell and purchase. Should a dispute subsequently
occur, these documents can be used as evidence, for example to determine whether
the condominium units have been constructed in accordance with the advertisements.
Restrictions
on Foreigner ownership
In
principle, foreigners who are qualified individuals or legal entities can own
condominium units under the Act, subject to foreign ownership not exceeding 49%
of the total area of all units in the development.
An
individual foreigner is qualified to own a condominium unit, if such foreigner.
1 has
permission to have a residence in Thailand; or
2 has permission to
enter Thailand for the promotion of investment; or
3 has (i) brought
foreign currency into Thailand, or (ii) withdrawn money from the Thai baht
account of a person residing outside of Thailand, or (iii) withdrawn money from
a foreign currency account. In certain circumstance, individual foreigners are
required to dispose of their condominium units within one year, including where
(i) foreign ownership in the development as a whole reaches the 49% limit; (ii)
residence permit is revoked; (iii) exile is imposed; (iv) the unit is inherited
by an unqualified foreigner.
Where foreign ownership in a development does
not reach the 49% limit, the land office has determined that, if the deceased
qualified under section 3 above, an heir would qualify as successor to the
deceased owner’s assets, and would not be required to dispose of the condominium
unit. Please note that where the deceased qualified under sections 1 or 2 an
heir must also qualify under the same section(s); otherwise, the heir must
dispose of the condominium unit with one year.
The Need for Caution:
Although there are very attractive offers
available from sellers of condominiums, buyers should exercise caution and properly
and thoroughly investigate the property to ensure that nothing has been
concealed and that the property and transaction fully comply with all requirement.