Property Guide
Property Guide

Bangkok

Pattaya

Phuket

3 Best Cities To Live In Thailand and Why?

Bangkok

Bangkok is one of the world’s top tourist destinations. Bangkok attracts millions of tourists every year and as a result, there is a high demand for condos including new developments, rentals, and resale property market in the city. In recent years, we have seen a massive increase in property prices in Bangkok due to the consistent development and economic growth in Bangkok.

So why is Bangkok a great city to invest and live in? Firstly, if you’re a foreigner, you have the right to own freehold condos in Bangkok according to the property ownership law in Thailand. This allows you to not just own, but resell or pass-on condos without restrictions. From the recent statistics, investors can make up to 5-7% gross rental yield on condos in Bangkok City Center. This is why Bangkok attracts a number of foreigners and is known as a multicultural city.

On top of that, Bangkok simply has everything you need in one place. The city center (known as Sukhumvit Road) has everything from street food stalls to Michelin star restaurants located in world-class hotel chains. You can also enjoy your evenings with a glass of cocktail while experiencing the most beautiful skylines and views of the city. Bangkok city center also has some of the largest and most recommended shopping malls, hospitals and International schools.

Transportation is key in Bangkok city, you have the options of taking taxis, motorbikes, or the sky trains located all within your reach. If you prefer a more calm and peaceful neighbourhood, then The Chao Phraya Riverside residences would definitely tick your boxes. At Right Key Estate, we have a wide range of inventory with different price ranges and qualities. Our local agents know the city in and out and are welcome to help you discover your perfect home.

Pattaya

Pattaya, known as the beachfront resort city on the Gulf of Thailand has bloomed due to a large number of both Thai and Foreign tourists each year. The Real Estate in Pattaya has been one of the fastest growing and sustainable industries in the past years. Pattaya is located only 2 hours from Bangkok City making it a perfect weekend getaway, leisure, relaxation or a retirement place. 

The city is never asleep! You can experience the perfect morning at the beach but once the sunsets, the city is full of lights, music and energy! Tourists love Pattaya due to the happy lifestyle, low cost of living and the scenic beauty it offers. A number of beautiful beachfront restaurants and sky-bars have recently opened up. If you’re more an outgoing person, you can enjoy all the beach activities, visit the waterparks or even the floating market. 

On top of that, Pattaya has been investing heavily in the city’s infrastructure. The local U-Tapao International airport has expanded to increase access to the city and a high-speed rail link is in the progress to be built and is said to connect Pattaya to Bangkok city within the span of 30 minutes. There has also been an expansion of the Laem Chabang SeaPort which connects Pattaya city to many other areas in Thailand. Speak to our local agents now about investing in Pattaya real estate.

Phuket

Phuket is an ideal location for investment and residential property. Property prices in Phuket remain well below regional real estate markets. The real estate market in Phuket has yet to peak and has a huge potential for investment. Known as the Pearl of Andaman, Phuket is well-known for having some of the most amazing beachfront pool villa homes and condos which is why Phuket is the perfect destination for retirement, expat living and holiday home.

Phuket is known for having some of the most amazing islands in the world perfect for those looking to find a summer home in a warmer climate. The amount of tourists in the city continues to grow each year with many new developments being built in the coming years. This tropical paradise is perfect for people of all ages due to its peaceful beaches, vibrant nightlife & the variety of activities it offers such as shopping malls, golf courses, yacht marinas, natural parks and more. 

The reason Phuket attracts a number of foreigners is due to its well-established infrastructure, international airport and quality services making relocation much more convenient. If you’re a family with kids, the island has excellent international schools with an extensive support network of clubs and societies available for foreigners. Feel free to speak to our local agents if you’re looking to invest in Phuket. 

Can Foreigners Own Property in Thailand?

There are several aspects to this question that need to be addressed individually. But yes! buying a property in Thailand as a foreigner is legally possible.

Just as there are different types of property ownership in Thailand, there are also different types of property that foreigners can buy in Thailand. In the following sections we will go into the most popular types of property in more detail.

Buying a Condominium

Foreign may only own a condominium (Freehold Tittles) in her/his own name. This is because Thailand passed the Condominium Act in 1979, and allows foreigners to own condo units freehold. However, the ownership of all foreigners in one condominium can not exceed 49% share of the total sellable area of all the units in that one building. While the remaining 51% of other units would be available only for Thai nationals to purchase.

Buying a Villa/House/Townhouse

Many foreigners dream about owning their own villa especially in such a location as Phuket or Pattaya due to its great weather and the relaxed way of life. So, can foreigners actually own villa/house in Thailand? The answer is not totally straight forward and needs some explanation but Yes! many foreigners are buying houses for lifestyle and investment reasons. 

Basically, the issue is that foreigners are not allowed to own the land the property is built on. But if you want to buy a villa or house in Thailand as a foreigner, that can be done by setting up a Thai company to own the land or buy under a long lease agreement, commonly known as “Leasehold” Many developers offer long term leases of 30 years with built-in renewals of up to 90 years. Meaning 30 years + 30 years + 30 years.

Buying Land

If the foreigner wishes to acquire land and build a house, he/she should obtain a long-term lease on the land (for a period not exceeding 30 years each term). A 30-year lease can be renewed, but renewal is not always enforceable by law. If the land owner or their heirs refuse or a further lease payment is often requested So it is agreeing this in writing with a land owner in advance.

Another option is freehold ownership through a ‘Thai Company’ if you are able to do so, meaning you have a Thai partner or partners. In the case of using a Thai Company the land remains under Thai ownership but the foreigner becomes a director who has control over that company. However, this type of ownership needs some consideration and should always be discussed with a competent Thai lawyer or law firm.

Buying a Villa/House/Townhouse

Many foreigners dream about owning their own villa especially in such a location as Phuket or Pattaya due to its great weather and the relaxed way of life. So, can foreigners actually own villa/house in Thailand? The answer is not totally straight forward and needs some explanation but Yes! many foreigners are buying houses for lifestyle and investment reasons. 

Basically, the issue is that foreigners are not allowed to own the land the property is built on. But if you want to buy a villa or house in Thailand as a foreigner, that can be done by setting up a Thai company to own the land or buy under a long lease agreement, commonly known as “Leasehold” Many developers offer long term leases of 30 years with built-in renewals of up to 90 years. Meaning 30 years + 30 years + 30 years.

What is Freehold/Leasehold?

Freehold Ownership

What is freehold ownership and can foreigners own property in this way?

Freehold ownership allows a person or entity to own a property outright. In this case you hold the title deeds for the property but these deeds come in different forms depending on the type of property. For example you might hold the certificate of ownership (Thor Or 5) which proves you own a structure (building, house, villa), a title deed to a condominium unit known as a Chor 2 or freehold ownership on a piece of land called a Chanote Title.

In Thailand foreigners are not permitted to own land freehold however a foreigner can own a condominium unit freehold. This is more commonly known as ‘foreign freehold’ ownership and is particularly popular with foreigners looking to buy real estate in Thailand.

Leasehold Ownership

What is leasehold ownership and can foreigners own property in this way?

Leasehold ownership allows foreigners to have rights over a property for a set period of time. The longest lease that can be legally registered is for a period of 30 years. However it is worth mentioning here that lease contracts can have further renewals written in allowing for additional 30 years periods to be granted by the lessor.

Leasehold ownership is very common for those buying property in Thailand as a foreigner if they want to own a villa. This is because it’s the most straightforward way to have legal rights over the land the villa is built on.

Property Taxes and Fees

Before you decide to buy a unit, you must understand your tax obligation when purchasing, holding, and selling the unit. Below are listed the most important taxes you have to pay when buying properties. Additional fees might apply, confirm with your agent if that is the case.

Transfer Fee – The transfer fee is calculating the property value by 2%. It’s generally paid by the buyer but this can be negotiated. The fee is sometimes split between the seller 1% and buyer 1%.

Stamp Duty – Stamp duty of 0.5% is charged and multiplied by the property value. It’s paid by the seller at the time of the transaction. In short, stamp duty is a tax placed on legal documents during the transfer of the ownership of the property.

Withholding Tax – A withholding tax is charged that increases progressively, depending on how long you own the property. The taxable amount is calculated by multiplying the sales value by a deduction factor in percent. The deduction factor ranges between 0.08 – 0.5%, the longer you hold the property, the higher the deduction rate. This tax pays by seller. For more information on how to calculate withholding tax, We would recommend you read this guide.

Rental Income Tax

Investors that buy-to-let are subject to a House & Land Tax of 12.5%, which is deducted from your yearly rental incomes. You also need to pay a rental income tax on the rental incomes that increases progressively from 0% – 37%:

  • THB 0 – 150,000: Exempt
  • More than THB 150,000 but less than THB 300,000: 5%
  • More than THB 300,000 but less than THB 500,000: 10%
  • More than THB 500,000 but less than THB 750,000: 15%
  • More than THB 750,000 but less than THB 1,000,000: 20%
  • More than THB 1,000,000 but less than THB 2,000,000: 25%
  • More than THB 2,000,000 but less than THB 4,000,000: 30%
  • Over THB 4,000,000: 35%

Business Tax (Capital Gains Tax)

This tax is levied on companies and owners holding a property less than five years. The seller must pay the 3.3% fee. The total amount is calculated considering the acquisition, the value-added and the use of the property.

What Are Maintenance and Sinking Fond Fees?

The Maintenance Fee

The Common Area Maintenance Fees, usually abbreviated to “CAM Fees”, represent the monthly operating cost of all the common facilities and areas. This is usually the electricity for the lights in the corridors and gardens, common swimming pool, fitness and lifts maintenance, the cost of hiring security guards and the maintenance of CCTV cameras, and more, depending on the facilities available. This amont will charged every month and are usually collected 1 or 2 years in advance, to avoid shortage of funds due to late payments. The CAM fees are usually calculated per square meter per month, and for condominiums will usually be in the range of 40-80 THB per square meter. The amount paid can be changed according to the changes in the real costs of the maintenance, and therefore can increase or decrease in the future, which is usually decided in the owner meetings.

The Sinking Fond Fee

Other than the CAM Fees, you will also be asked to pay for a “Sinking Fund” on the purchase of the villa or the condominium of your choice. The Sinking Fund is used for major maintenance operations such as large repairs, repainting, replacement of outdated equipment, and other large expenses that only occur once in a while. Therefore, your contribution to the Sinking Fund isn’t collected on a regular basis, but only one time on the purchase, and maybe later again depending on the common decision of the owners on the necessity of making a large maintenance expense. This contribution to the Sinking fund tends to be around 400-800 THB per square meter.

For private villas, the management of the CAM Fees and Sinking Fund largely depends on the developer, who will usually appoint a management company to handle these matters. For condominiums however, the law is much more precise regarding the management of these common fees. Until most of the sale of the private units have been sold, the developer is still in charge of the common area maintenance, and once a large majority of the units’ ownership has been transferred to the buyers, a “Condominium Juristic Person” will have to be established. The Condominium Juristic Person is then responsible for managing the CAM fees and Sinking fund contributions.

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