In a previous article, we talked about recommended locations for investment. For this month, there is no better time to write about the tips & tricks for foreigners to transfer property ownership in Hua Hin than now. Let’s not waste a minute further and delve together into this article. Our Lazudi Property expert, Andy Dyett is here for another article to explain it to you.
First, foreigners should know about the documents they need to prepare. We started by asking our property expert about the required documents for transferring property ownership for foreigners to purchase condominiums. Andy Dyett started by saying that first, foreigners will need to transfer funds from their overseas account to the account in Thailand. They will need to obtain a certificate from the bank to prove income from overseas. They will also need to obtain their Mother and Father’s names from the buyer. A foreign address, passport and a cashier’s cheque prepared for transfer into the seller’s name will also be required. This can sometimes take up to 2 weeks to obtain from the head office.
Next, we ask for the required documents if foreigners would need to prepare should they want to purchase land or a house in Hua Hin. Mr. Dyett further said that this is a less stringent process as a foreigner will not need a bank certificate to buy. The money can be transferred and then they need the passports and foreign addresses. For buyers that are unable to be present on the date of transfer then they can also use a power of attorney form and allow the lawyers to act on their behalf. A legal contract is also required. Ideally, they also would need a pre-sale reservation to outline the concept of the sale followed by full and detailed contracts including the inventory of items included in the sale.
What about the sellers? Mr. Dyett said that sellers would need to prepare the title deed. The original title deed will also need to be present along with the blue book, build permit or ‘tor ror 900’ and passports. Foreigners will also need to prepare foreign quota certificates. This is related to the condominium block and the number of units. Only 49% of the building can be foreign freehold owned. Next is the debt-free certificate which the seller needs to prepare. It is a document showing the seller has no outstanding financial obligations and it can take time to obtain about 2 weeks.
Is the purchase through foreign-owned companies possible? When asked, Mr. Dyett gave the opinion that it still can be done for those preferring this option. In the past about 10 years ago, it was done differently and it was more accepted as a form of ownership. As for today’s market, leasing options are legal, more accepted, and a lot safer for foreign buyers.
For the leasehold process, Mr. Dyett said this does worry some people but with the right clauses and documents it’s as good as freehold. Foreigners can register for 3×30 years and have clauses offering rights of renewal, rights of succession, and rights of freehold. It is known to be very safe if done properly with the right paperwork.
Now let’s talk about taxes and fees. So for taxes, at the time of transfer, there are a number of taxes that need to be paid and in many cases, it is simply agreed to share these 50/50. The taxes do fluctuate so it has become a common rule to share all costs. It is important to have these fees checked as a property being sold in under 5 years since the last transfer will be subject to Specific Business Tax. For the fees, there is the transfer fee of 2%, withholding tax, 1.1%, Stamp Duty 0.5% and if applicable the specific business tax of 3.3%. These can be based on the assessed declared value but if buyers and sellers prefer or if a Thai buyer is looking to mortgage the property then a full contractual price might need to be declared.
Lastly, a word of advice from our Property Expert is that “Owning property is very safe and simple if you do it correctly. This is provisional law in Thailand and the national guidelines for ownership do vary once within the province, Hua Hin, in particular, is great for foreign buyers, however, you need to find a good legal local and real estate specialist for the due diligence and transfers. Buying property for foreigners should be enjoyable and not stressful!”
Finally, we hope that this article can benefit you in one way or another. For those looking for property in Hua Hin, please feel free to contact us today at Lazudi.
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