The lure of Phuket's beaches and the bustle of Bangkok has prompted many visitors to buy property in Thailand…

Foreigners cannot buy land outright, but they can buy up to 49 percent of a property's aggregate space. So, for example, a prospective resident can buy a condominium as long as Thais own at least 51 percent of the rest of the space in the building.

To buy a house or land, or an apartment in a building that has exceeded its quota of foreign ownership, a Thai company structure is required. Again, 51 percent of the company would have to be owned by Thais but, with legal advice, it is possible to arrange foreign control of such a company.

Arrange funds transfers in advance

The transfer of foreign funds to a Thai bank must be arranged well in advance of any purchase. The prospective buyer is required to disclose that the money is being transferred for a property purchase, and the exchange to Thai baht must be done in Thailand.

Also, transfers must be done in increments of $20,000 or more to generate a Forex Transfer Form. That form will be required at the title transfer and, later, for capital gains tax calculations. Capital gains are taxed at 27 percent.

In a new development for foreigners, the Singapore branch of Bangkok Bank now is offering residents and nonresidents of Thailand financing of as much as 70 percent over 10 years for property purchases.

The Bank of Thailand, the country's central bank, "has prohibited Thai banks from lending money to foreigners for real estate in the past," said Nigel Cornick of Raimon Land, a property developer in Bangkok. "If Bangkok Bank does it properly, and has enough funds available, this could be extremely popular," Cornick said.

Reservation fees

When buying a new condominium, an initial reservation deposit of about $1,250 is required; the amount is deducted later from the total price. Once an agreement is signed, usually 10 to 15 days after the reservation, the buyer is required to pay 10 percent of the total price. Depending on the terms of the contract, the balance then could be due in installments or as a lump sum at the time the title is transferred.

Additional expenses include: Transfer fees of about 2 percent of the sale price.

A charge of 350 to 600 baht per square meter, which is added to what is called the sinking fund and used for major works or unforeseen repairs.

The advanced juristic fees, also known as management or maintenance fees, of about 50 to 65 baht per square meter per month, depending on the project.

Source: http://www.iht.com