Old Buildings May Not Be Properly Maintained

Category: Finance, Real Estate.

There are a few things you need to be aware of before buying a condominium in Thailand.

Earlier, foreigners were allowed to own only up to 40% stake in any condo building. The Thai government has recently modified the rules governing the purchase and selling of condominiums. This was recently raised to 49% and, as a result of this, more condo units are now available on the market. Once you have found a unit, consider how old the building is. This first step in buying a condo should be appointing an experienced and ethical agent to take you around and show you the condos available for purchase. Normally, a building over 20 years old may be too risky to invest in. Sometimes, old buildings could be scheduled for demolishing in the near future.

Old buildings may not be properly maintained. Examine the documents carefully to find out the age and health of the building. Sometimes, buying a slightly older building can be beneficial in certain ways. Ask the present owner of the condo what his future plans for the building are. The owner will have a proven track record of maintaining the building properly. Examine the building carefully to see how well it has been maintained.

You can easily check this with existing tenants. It is advisable that you collect as much information as possible before you commit yourself. This is usually calculated in terms of the plinth area you purchase. Consider how much you will be required to pay for the maintenance contract annually. Also consider if the condo management has set up a sinking fund. It usually ensures that the building will be well maintained in future.

Sinking funds often require a one time payment made upon transferring ownership. Some condos require a sinking fund payment annually. Before purchasing, ensure that you understand the sinking fund payment policy well and how much it will cost you. Sometimes the sinking fund is paid on demand . Also find out if the management has set up an annual insurance premium, what the amount, and if so of premium is. In most cases, the owner pays the transfer fees in full. It is also important to know how long the present management team has been looking after the building.

It is not uncommon that some owners insist you to share the costs 50/ 5Ascertain who pays the transfer fees and calculate how much it will cost you if you are required to pay. The present rate of transfer fee is 2% of the purchase price in Bangkok and Pattaya. You can ask your lawyer to prepare a full schedule of the payment of transfer fees, including any income taxes outstanding on the property. You have to pay a property business tax of 3% , and a stamp duty of 5% . So ensure that you check them before committing yourself to pay any transfer fees. These rates are, subject to change, however. You may bring in purchasing funds from overseas to the country.

You may not bring all the money into the country until after you have decided upon the property you wish to buy. The Thai government has fixed a minimum amount of$ US 10, 000 to be brought from overseas. It is advisable that you bring in enough to pay a minimum deposit of 20% or 30% . Your lawyer will be able to tell you the difference. When buying a condo in Thailand, also understand the difference between buying leasehold and buying freehold. If you buy leasehold, you will never own the property.

In case you will not permanently reside in Thailand after you have purchased the unit and you plan to rent it out, it is advisable that you appoint an agent to manage the unit for you. Buying freehold gives you full ownership rights on the condo. It is important that you enter into a clearly written contract with the agent. It is highly advisable that you take your lawyer also to the bank when you bring in money from outside to buy a property. The contract should spell out the conditions of management, including the agent s commission, and the amount, his responsibilities he will spend on advertising. It is imperative that you get a T.

This form states that the money you brought from outside is used to buy the property. T. 3 form. You will have to show the T. T. 3 form to the bank at the time of exporting the funds back to your country.