If the allure of living long-term in the Land of Smiles has caught your attention and you’re considering buying a luxury condo in Pattaya, first there are a few things you should know about Thai condominium ownership as a foreigner (aka expat’). So, before you go condo shopping, we recommend you read this brief guide and get acquainted with the top things you should know about the local real estate market. You’ll want to go in with eyes wide open, so you avoid any potential pitfalls, which could be both costly and inconvenient.
First and foremost, understand that any bank loan you get to buy your dream home has to be in the form of foreign currency. Why? Because to buy a foreign freehold condominium you have to send foreign currency into Thailand from overseas to generate the foreign exchange transaction forms’ necessary to register the title deed at the land office.
This means local banks have to jump through a lot of legal hoops (such as partnering with a bank outside Thailand) to provide you with a mortgage. In addition to this, foreigners are viewed as a risky investment; banks don’t want to spend their time chasing down assets overseas from absconding foreigners. These reasons all conspire to make the lending market very tough for foreigners and means that 90% of the foreign buyer market is cash-based.
If you are one of the lucky few who manages to find a bank willing to lend them the money for their purchase, keep in mind that generally, banks are looking for lenders who have some kind of long-term and successful business in Thailand (you’ll need to provide all manner of financial papers to prove this); preferably be married to a Thai national (with their own income stream); that you have other assets of value in Thailand; and that you have a good credit history, meaning you pay off your credit cards on time.
You should also be aware from the outset that you won’t get a great lending rate from any local bank. As a foreigner, your loan repayments will be as high as 6-10%, compared to only 3-4% for Thais. On top of that, you’ll be expected to put a cash payment of 30-40% down at the outset. Oh, and if you’re over the age of 60 don’t even bother applying, they won’t even consider you.
The last thing to mention is quotas. Bear in mind that only 49% of a condominium can be sold to foreigners. In a cosmopolitan city like Bangkok, this is not a problem, as the majority of buyers are always Thai nationals. However, once you start going further afield, to places like Pattaya, Phuket, Koh Samui, Chiang Mai and Hua Hin it’s a different story. This is a long-held rule in Thailand, aimed at protecting the local economy and keeping foreigners in their place (aka as outsiders’). So, when buying your luxury condo in Pattaya, make sure you do your due diligence and double-check that the correct quota’ of foreign units is available to be sold to you on a freehold basis. At the end of the day, the developer will take your money and run, any legal wrangling for long-term ownership will fall on your head.
I’m a 20-something stay-at-home mother and wife. I have an amazing husband, a beautiful daughter, two loving dogs, and a lazy cat. I wouldn’t change my life for anything! I love to read, listen to music, cook and blog!
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