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To begin, purchasing a home on Koh Phangan needs the assistance of a property lawyer who can guide you through the legal procedure. Property law in Thailand is complex and generally uncontrolled.
When we speak about real estate transactions in Thailand, the emphasis of the sale is often on the land and home. The Land Code of Thailand, however, places restrictions on foreign land ownership. Although foreign ownership and development of land are prohibited, there are certain exceptions.
As a foreigner, you have two options for purchasing a home or villa on Koh Phangan:
Foreigners may engage in 30-year lease contracts in which they are protected in the same way as freehold owners are. This contract may be renewed or extended twice, and the foreigner can own the land for up to 90 years. After the agreement expires, he or she will not be able to claim ownership of the property since the substantial asset has been withdrawn from the estate.
In Thailand, forming a limited liability corporation is a decision that does not fully accommodate people with low financial resources. The freehold land of any organized firm in the name of a foreigner is registered in the company's name.
When a single investor is only qualified for a maximum of 49%, this approach requires two or more foreign shareholders. However, the company's managing director, who controls voting and other shares, acquires full control of the property.
While foreign ownership of property and improvements on the land is prohibited, there are exceptions to this law if the following conditions are met:
If a foreigner purchases real estate in Thailand, the ownership of the house can be registered and transferred separately from the land on which the house is built; the transfer procedure must follow the Thailand Civil and Commercial Code; the transfer must be in writing, and the transfer must get registered with the Land Department's branch or provincial office.
The present owner and buyer of the home must follow the usual process at the Land Office when selling and transferring ownership of an existing building apart from the land. Otherwise, the developer or a third party that owns the land owns the building legally.
Real Estate in Thailand and Koh Phangan, in particular, has really taken off in the past decade with more foreigners or investors wishing to live here or also to make this country their holiday home. Whilst many people wish to own a house on Koh Phangan, it is very important for you to consider the following when buying a house:
When seeking real estate guidance in Thailand, always consult with licensed attorneys and reputed estate agents. Their knowledge will undoubtedly assist you in locating the finest bargains and safeguarding your interests while purchasing real estate.
Make some inquiries. When looking for real estate in Thailand, see the Thailand Real Estate Outlook, the Real Estate Glossary, and the Real Estate FAQs. These will expand your options for property types and appropriate regions and locales.
When looking for a home in Thailand, be sure to read up on the common real estate mistakes. To prevent expensive lawsuits, ask the proper questions. It is important to consider both the benefits and drawbacks of offers and bargains.
Be aware that many of the issues that may occur while purchasing a home on Koh Phangan can be avoided if you start looking for a home early. Make sure to look into any applicable rules or laws.
Always contact a lawyer before signing any papers after you've chosen the home you want to buy. Foreigners may not own a home in their personal name, but their Thai-registered corporation may.
Thailand has several distinct types of business entities. A Thai Limited Company is the most popular kind. The limited corporation must meet specific business registration requirements. For Americans, the Thailand Amity Treaty still exists, and there are financial concerns as well, so examine Corporate Tax in Thailand if you plan on doing more than owning a home or require a Thai Work Permit.
However, keep in mind that in order to be active, the firm must be doing a legal business, since inactive businesses may be delisted from the Business Department. As a result, the company's assets, including, for example, the home, will be liquidated.
Following the registration of your Thai Limited Company, most agents provide the following property services, among others, so contact your property lawyer immediately.
Before signing, they would do a title search and review the terms. The title search is critical because it is via this process that the buyer determines if the seller is the legal owner of the subject property. Take notice of the different types of title deeds used in Thailand. Thailand's title deeds are divided into the following categories:
Deed of Freehold Title (Chanote or Nor Sor 4)
This kind of title gives the possessor complete control over the property, allowing him or her to deal with or utilize it without regard for others.
Nor Sor 3 Gor
This document is given to a land that is awaiting a complete title. As long as this is ready to be a complete title deed, this kind of property can be sold, transferred, or mortgaged in the same way as land with a freehold title deed can.
Nor Sor 3
This varies from Nor Sor 3 Gor in that the Land Department has yet to measure the title, thus the land has no precise borders.
Possessional Right is a legal term that refers to the ability to possess something. This kind of title deed is the least recommended since it is not backed up by the Land Department, but rather by tax payments to the Local Administrative Office.
If you're purchasing a home off the plan, you'll need legal counsel on pre-construction projects. There are also transfer fees and Thailand property taxes to consider. To figure out how much you'll have to pay in fees, use the property transfer calculator. Before you start the process of purchasing a home in Thailand, make sure you contact a respected law company.
The process for transferring ownership of a home must be completed at the land office. In Thailand, the land office is the sole government agency responsible for the administration and completion of a building transfer. For the transfer, the following papers are required:
Thai home and official real estate papers, including the owner's and buyer's passports/ID cards, the land title deed, the house book (Tabien Baan), and the construction permission.
The transfer of ownership of a home is treated as an immovable property, which is subject to income withholding tax, transfer fees, stamp duty, and special business tax based on the registered selling price or assessed price.
The assessed (appraised) value of a home used by the land office is determined by many factors, including its location, number of floors, floor area, and materials utilized.
Please keep in mind that after you've completed the transaction, you'll need to transfer all of your utility services, such as gas, electric, cable, and phone, to your new address.
Now you can begin your new life in your new home and enjoy the amazing island lifestyle of Koh Phangan or reap the rewards of an investment.