Closing on a Condominium
A Swiss lady wrote "I am considering purchase of a condominium
in Phuket and was hoping that you could outline the procedures that
I will have to go through to secure my purchase"
Buying a condominium is in principle the simplest form of property acquisition that a foreigner can make in Phuket, but, and perhaps this is because people underestimate the simplicity of the process and try to do it alone without professional assistance, it is the one where there is often the most hi coughs in the transfer process.
The process is simple in as much as it is almost the only form of property interest in Thailand where a foreigner may directly purchase freehold ownership. Since 1991 when the Condominium law was first amended to allow foreign ownership until the autumn of 1999, up to a maximum of 40% of the units (by percentage strata interest) in a registered condominium unit could be acquired by foreign nationals provided that they met certain requirements, the most important one being that they had remitted the funds for the purchase of the unit in foreign currency from abroad. That percentage has incidentally just been increased to 49% for all condominiums and 100% in a few qualifying condominiums - which means that there is once again availability in the allowance for foreign acquisition into many of Phuket's more popular condominiums.
So what do you need to effect purchase and legal transfer of ownership
of a freehold condominium, beyond a willing vendor and the required
payment. Just 4 documents really A) a valid passport, B) a letter in
Thai from the condominium's juristic manager certifying that all condo
fees and dues are fully paid and current at the date designated for
the transfer C) a table in the prescribed format in Thai showing the
names, nationality and percentage strata interest of all the current
owners (and the proposed new owner) of the condominium demonstrating
the foreign ownership percentage does not exceed the applicable maximum
and D) a Tor. Tor. Sam exchange control from the bank of Thailand showing
that you, the purchaser, has remitted foreign currency from abroad.
Sounds quite simple really, and indeed it can be. Two foreigners (a buyer and seller) could in theory go to the provincial land office and effect the transfer of a condominium unit, there is no requirement to use a lawyer or even any Thai representative of any sort.
In practice however unless at least one of the parties spoke good Thai it might be near to impossible, and in practice it is far more efficient (and less taxing on your patience with Thai bureaucracy) to give a power of attorney to a Thai experienced in such matters, to represent you at the land office (while you relax on the beach).
So where do the hi coughs occur. A) the passport is clearly easy, you are unlikely to be in the country without one, B) and C) will usually be arranged by the vendor through the condominium juristic manager - who is legal required to provide the documentation (but are occasionally know to be less speedy in doing so than would be desired), the problem invariably starts with D, in regard the manner in which you, and in particular your bank, arrange acceptable evidence of foreign exchange.
What you must arrange is a Tor. Tor. Sam (T.T.3. in English), which is an exchange control form from the bank of Thailand showing that you (your name needs to show on the document) have remitted foreign currency for the express purpose of buying a condominium in Thailand.
This is best effected by sending funds from a foreign currency account in your own name abroad to a account in your own name established with a Thai bank in Thailand. The remittance has to be relatively recent (money that you sent in last year won't be acceptable) and it has to be in an amount very close to the registered purchase price of the unit you are buying - certainly no less, but make it too much more, and you may find that they want to try to deem your remittance sum as the taxable transfer price of the unit you are buying (costing you more in fees and taxes on the transfer).
The most important point however is that you must fully brief the remitting bank that the remittance must be sent in foreign currency - increasingly these days, foreign banks are maintaining Thai Baht accounts with banks in Thailand and then try to sell you offshore the Baht they already hold in these onshore accounts - with the result that no foreign exchange is explicitly remitted to Thailand for your transaction - and no TT3 can be issued in your name.
If you brief you offshore bank carefully and also alert your local bank to your remittance and it's purpose in advance, and follow up with them the day the remittance arrives, there should be no difficulties in obtaining the required TT3, but make no mistake about it without the Tor. Tor. Sam the theoretically simple purchase of a freehold condominium can become an unnecessary nightmare.