Performing Property Due Diligence in Thailand is vital for many reasons. First and foremost, it will help you avoid legal issues that can affect your property in the future. There are many things you should know about Property Due Diligence in Thailand and some of them are described below. Seeking the services of a lawyer or solicitor in Pattaya is recommended before signing any contracts.
Property Document Review
As with any purchase, you will want to do your research before making an offer on a piece of property in Thailand. You will want to check whether there are any encumbrances on the property, as well as building permits and mortgages. If the current owner is behind on these fees, you may want to check with the building management company to see if the buyer can catch them up. Likewise, if the property is a condominium, you may want to check with the condominium development authority to ensure there are no restrictions on the property.
Comprehensive Title Search
When you buy property in Thailand, you must perform a thorough search for any legal issues. A thorough search includes document review and legal due diligence. You will also need to ask questions about the property, including the legal status, who is the owner, and if there is any encumbrance or other charge on the property. In addition to these questions, you will need to investigate the infrastructure of the area, including the telephone, sewage, and other systems.
Investigation of the Property
When looking for a property to buy in Thailand, you should be aware of what due diligence entails. Basically, due diligence entails checking the property’s history and position, as well as confirming whether the seller is the rightful owner. In addition, it should include checking the land’s legality by looking for records of property taxes, registered values, and powers of attorney. Moreover, due diligence will also involve checking the owner’s background, such as how long they’ve held title to the property. In some cases, you may consider purchasing property that has a business attached to it, but you must remember that this does not mean that you should buy that property.
Check Building Permits
Before you can build a house or other structure in Thailand, you must obtain a Building Permit first. A Building Permit is a legal document issued by the Local Municipality for a particular plot of land. Unless you’re a resident of Thailand, you cannot own land in Thailand and certain occupations are not permitted for foreigners. Therefore, many foreigners place their Building Permit in the name of their Thai wife. Although you can change your name on the building permit during construction, most foreigners do so under the wife’s name.
Taxes Paid on the Land
When buying property in Thailand, you should be aware of the taxes that have to be paid on the land. Generally, taxes are collected on an annual basis. The rates vary depending on the location, but these are the highest rates that the local authorities can charge. Furthermore, land and building tax rates can differ depending on the district. You should note that foreign nationals cannot buy land in Thailand. The Land Code Act governs this. However, there are no restrictions on foreign ownership of condominiums and buildings in Thailand.
Rights Against the Land
In the Thailand property market, there are many legal risks that you may encounter when buying property. While these issues may be prevalent in any jurisdiction, some common problems are related to the ownership of immovable property. To avoid pitfalls, do your due diligence to check the legal ownership of property. In Thailand, this means conducting a land title search and hiring a property practitioner to review the relevant documents. Ultimately, you will be able to make an informed decision and avoid potential legal issues.