Are you a local or a foreigner interested in property investment opportunities? Bangkok property is an asset worth considering, but it can be hard to know where to start and where to look if you are unfamiliar with the market. Continue reading to find out our top three considerations for acquiring a condominium in Bangkok.
1. Understanding Thai Foreign Property Ownership Laws.
Can foreigners buy property in Thailand?
Investing in a condominium or condo for sale can be a great way to dive into homeownership or a means to generate a passive income through rent. As an international buyer, the first thing to get to grips with is that Thai regulations and restrictions for property ownership can be complicated and overwhelming. Carrying out research and due diligence is essential before making any decisions.
There are two ways a foreigner can purchase property in Thailand. These will depend on personal circumstances, financial goals and the reason for buying.
All properties, such as a house, villa or condominium, can be purchased as a leasehold. The property is owned for a fixed time, typically 30 years in Thailand, and returned to the freeholder upon expiry of the term. The leaseholder has rights to the property, can use a mortgage to purchase it, and the purchase price is usually lower than a freehold property since a leasehold property does not own the land it sits on.
Freehold purchases typically apply only to condominiums. It is the most common ownership tenure as the property is owned outright until its disposable. One of the key benefits is that this form of ownership allows for a long-term investment strategy enabling the owner to take advantage of future rising condominium prices.
Foreigners can purchase freehold condominiums but only up to 49% of the saleable area of a condominium. Called Foreign Quota, it leaves the remaining 51% to Thai nationals or Thai entities, and in cases where there is no Foreign Quota, overseas buyers can only acquire units in the building on a leasehold basis.
2. Finding the Right Location.
Find the right location in Thailand
As the mass rapid transit system expands around Bangkok, it makes the city more accessible and travel more convenient. Property developers seek to take advantage of this infrastructure by building condominiums close to public transport links to alleviate traffic issues and improve the travel experience for owners. Location is one of the most important factors to be considered when making a purchase decision.
We have categorised location preferences among expats as:
- Top Lifestyle Hotspots - Phrom Phong, Thong Lo, Sathorn, and Ekkamai.
Phrom Phong, Thong Lo, Sathorn and Ekkamai are the top four locations in Bangkok for high to upper-middle-class expatriates with several different condominium styles available. These neighbourhoods offer vibrant lifestyles with a variety of dining destinations, luxury shopping malls and amenities. Due to the high demand for these areas, condominium owners find it easy to secure a suitable tenant.
- Budget-Friendly and Well-Connected Areas – On Nut and Phra Khanong.
On Nut and Phra Khanong have increased in popularity among expatriates due to their affordability while offering easy access to commercial hubs. These closely knit communities host attractions like the W District and an eclectic mix of sky bars, night markets and high-quality restaurants.
Property investment in these locales is worth considering due to the abundance of premium and more affordable condominiums, most located close to the MRT/BTS lines. Additionally, most expatriates tend to work in Bangkok’s commercial and business centres, so living in these areas reduce commuting costs due to their proximity to central Bangkok.
- Up & Coming Neighbourhoods - Bangkok’s Riverside.
Interest in Bangkok's riverside district has risen for those wanting to combine convenience and the tranquillity of a peaceful neighbourhood. Moreover, the area is well-connected to the city centre by MRT/BTS lines, meaning it is one place to live in calmer and more serene surroundings without compromising on distance from the city centre.
3. Securing a Mortgage.
Mortgages for foreigners in Thailand
As a foreigner, is it possible to access finance from a local bank to purchase property in Bangkok?
A common question requiring some explanation to answer, but in short, it is possible to get a Thai mortgage as a foreigner. However, securing such financial products can prove to be hard, time-consuming, and for many, elusive.
Many Thai commercial banks can be averse to offering loans to foreigners and only grant long-term loans to individuals with lengthy commitments to Thailand. This can be proven through extensive professional and business links to the country, such as business owners or anyone with several years of employment.
An option for increasing the likelihood of securing finance as a foreigner is accessing joint-mortgage products applicable to foreigner buyers married to Thai nationals. Lending rates and conditions are competitive, but assessments are usually on the Thai national’s credit profile. Therefore, a loan is more likely to be secured if the Thai national is a working professional with a strong credit history.
Foreigners should inquire with local banks directly through their head office as access to loans via the approaches outlined above can be granted arbitrarily with rates and conditions fluctuating wildly between banks on a case-by-case basis.
However, to give a baseline to understand potential rates, it is always good practice to research by reading related content or using condominium mortgage calculator before contacting different local banks.
The benefits of a condominium mortgage calculator.
A condominium mortgage calculator helps estimate monthly mortgage payments to help make an informed decision on a property purchase, which is especially important as a foreigner looking for property investment opportunities in Thailand. It is also another potential route to accessing finance with the local traditional Thai banks.
- MBK Finance - is the most popular institution catering to the needs of expatriates and foreign buyers. They offer foreigner-friendly loans on condominiums that can be competitive.
- United Overseas Bank (UOB) - the Singaporean bank is known to offer finance products to Singaporeans, even allowing the mortgage settlement repayments in Singaporean dollars.
- Hong Kong Offices of Kbank and Bangkok Bank can assist Hong Kong nationals in obtaining financing for property investment in Bangkok, also allowing repayments in HK dollars in Hong Kong.
Conclusion.
Buying a condominium is a huge decision, so it is imperative to conduct in-depth research. In addition to the considerations covered in this article, buyers should also assess property management companies and property developers. The most convenient way to browse condominiums for sale is to look through websites such as DDproperty.com . Filters allow searches based on preferences such as locations, budget range, condominium types and many more. The site also offers helpful information like pricing insights, a condominium mortgage calculator, down payment plans and the chance to get in touch with real estate agents or developer representatives by logging your contact information on the website.