Thailand is one of those countries which tends to be misunderstood, due in the main to a lack of real promotion by the authorities.  While there was a coup in 2006 and some confusion and concern after the operation, the situation seems to have calmed down.  The military generals are in contact with the likes of the US, with many people confident that “normal” life can soon be restored to the country.

For some time Thailand has been the most popular destination for tourists to the Far East, with many visitors returning to make the country their permanent base.  Many have been attracted by the relatively cheap property, low cost of living as well as the potential for the future.  The locals have always welcomed foreign visitors which has reflected well on the country as a whole.

The property market obviously suffered from the backlash of the 2006 coup, however for many this has offered the opportunity for Expats in Thailand to pick up some prime property at very good prices.  The country is highly dependent on exports and as yet there has been no real effect on trade with the outside world. 

Contents: Property Market Performance in Thailand | Property Costs in Thailand

Property Market Performance in Thailand

While the property market did stall a little after the coup, as you would expect there are various hot spots which have recovered quicker than others.  Demand is currently patchy, and while interest rates are on the way down, and various taxes have been cut to the very minimum, many are awaiting news on planned elections.  The majority of observers expect a sharp rebound in the property market as and when elections are confirmed, although the country is in something of a vacuum at the moment.

Historically Thai property laws have been rather liberal with no restrictions imposed on new builds.  This has effected the secondary market with many investors looking to acquire new properties (of which there are many) rather than acquire a second hand property.  In order to boost this area of the property market the government will at some point need to introduce a quota system.

Thailand has the largest city in the world in Bangkok, and this has dominated the property market for years.  In effect there are really two property markets, Bangkok and the rest of the country.  Most foreign nationals are attracted to the area of Bangkok because of the services available, the standard of living, employment and the direct transport links.  

Even though the ruling military have promised to consider elections in due course, there has to be a degree of concern that if a coup occurred in 2006, what is to say this may not happen again in the future.  It is doubts like this which are holding the country back from even further economic growth.  Once the situation has been resolved the property market should receive a useful boost, but when this will happen is still uncertain.

Property Costs in Thailand

There are two ways to buy a property in Thailand, either through a Thai Limited Liability Company (which will cost £1,000 to set-up, and £50 a month to administer) or through a leasehold agreement which needs to be at least 90 years in length.  Both are safe ways to buy property, having been tried and tested for a number of years.

Other costs will include :-

A local lawyer specialising in property law - fees can be negotiated.

A Property agent - who is normally paid on results.

Reservation Fee (for new builds).  Once you have agreed to purchase a new build the developer will request a 10% deposit which will be deducted from the final price.

Stamp Fee.  Historically in the region of 0.5%, this fee has effectively been waived for the short term as the authorities try to breath some life back into the market.

Transfer Fee.  Historically about 2% but under review in the short term.

Structural usage tax.  This is based on the assessed rental value of a property, and equates to 12.5% of forecast rental value per year.

Capitals Gains tax is very low, in the region of 1% and 3%, depending on your level of income.