11 Steps to Buy a Property in Phuket, Thailand

Purchasing property in Phuket, Thailand, can be an exciting venture, whether for personal use, investment, or retirement. However, navigating the process requires understanding local laws and regulations.

Property investment in countries around the world is what we specialise in APW Group. Here’s a guide to help you through the steps involved to buy a property in Phuket.

A serene view of Phuket's coastline is framed by a property's window

Steps to Buy a Property in Phuket

1. Understand the Legal Framework

Before diving into property hunting, familiarize yourself with the legal aspects of buying property in Thailand:

• Foreign Ownership: Foreigners can own up to 49% of a condominium building, commonly known as a condo. For land purchases, foreigners typically cannot own land directly but can lease it long-term.

• Thai Company: Some foreigners opt to set up a Thai company to own land, which is a legal avenue but requires careful consideration and compliance with local laws.
  

2. Determine Your Budget

Establish a budget that includes not just the purchase price but also:

• Legal fees

• Transfer taxes

• Maintenance costs

• Property management fees (if applicable)

Speaking to a property investment professional is advised to ensure you understand all the local regulations and associated costs.

3. Choose the Right Location

Phuket has diverse areas, each offering different lifestyles and amenities. Consider factors such as proximity to beaches, access to amenities like shopping and healthcare, as well as rental potential. Phuket’s diverse neighborhoods each offer distinct lifestyles, making it vital for prospective buyers and investors to thoroughly research and evaluate their options based on personal preferences, lifestyle needs, and investment goals. Some popular investment locations in Phuket include:

• Patong Beach Renowned for its vibrant nightlife and extensive entertainment options.

• Kata Beach Offers a more laid-back atmosphere while still providing access to various amenities, ideal for families or those looking for a quieter living environment.

• Karon Beach Known for its beautiful sandy shores and a good mix of local restaurants and shops, appealing to both long-term residents and vacationers.

• Bang Tao Beach and Surin Beach Famous for luxury resorts and high-end dining options, attracting affluent buyers and investors.

• Nai Harn and Rawai offer a more authentic Thai experience with local markets and a friendly community atmosphere, appealing to expatriates and retirees alike.

  
  

5. Property Viewing

Scheduling visits to potential properties is a critical step in the home-buying process. During these viewings, it is essential to thoroughly assess the condition of the property. Look for signs of damage, such as cracks in the walls, water stains, or outdated electrical systems.

Additionally, evaluate the surrounding environment. Consider factors like noise levels, the quality of nearby schools, and access to amenities such as parks and shopping centers.

It's also worth research any future development plans in the area that could affect property values or your living experience. Local government websites and community boards are excellent resources for this information.

6. Conduct Due Diligence

Before making an offer on a property, conducting thorough due diligence is crucial to avoid potential pitfalls. Start by verifying property ownership and title to ensure the seller has the legal right to sell the property. Consult public records or a title company for this information.

Next, check for any liens or encumbrances that may affect the property, such as unpaid taxes or outstanding mortgages. These could become your responsibility after the purchase. Lastly, understand the property’s zoning regulations, as they dictate what you can and cannot do with the property, including any renovations or business activities.

7. Make an Offer

Once you have identified the right property, the next step is to make a formal offer. This process often involves negotiating the price and terms of the sale with the seller or their agent. Consider factors such as the current market conditions, the property's condition, and comparable sales in the area to determine a fair offer price. Be prepared for counteroffers and maintain flexibility in your negotiations. Additionally, consider including contingencies in your offer, such as financing or inspection contingencies, which can provide you with an exit strategy if certain conditions are not met during the buying process.

8. Sign a Sales and Purchase Agreement

Upon reaching an agreement on the terms, both parties will sign a Sales and Purchase Agreement (SPA). This legally binding document outlines the details of the transaction and is crucial for protecting both the buyer and seller. Ensure the contract includes payment terms, specifying how and when the payment will be made. Additionally, the completion date should be clearly stated to avoid any misunderstandings. Lastly, include any contingencies that must be met before the sale can proceed, such as financing approval or satisfactory home inspections, to safeguard your interests throughout the process.

9. Pay the Deposit

Typically, a deposit of 5-10% of the purchase price is required upon signing the Sales and Purchase Agreement. This deposit serves as a sign of good faith and commitment to the transaction. The amount is usually held in escrow by a third party, such as a real estate agent or attorney, until the sale is finalized. It is essential to understand the implications of this deposit; if you back out of the deal without a valid reason, you may forfeit this money. Conversely, if the seller fails to meet their obligations, you may be entitled to a refund of your deposit.

10. Complete the Transfer Process

The final step in purchasing a property involves transferring ownership at the local Land Office. This process requires the submission of several essential documents, including identification documents that verify your identity, such as a government-issued ID. You will also need to present the Sales and Purchase Agreement to prove the legitimacy of the transaction. Additionally, be prepared to pay transfer fees and taxes associated with the property transfer, which can vary by location. Completing this step is crucial to ensure that the property is legally recognized as yours.

11. Register the Property

After the transfer is complete, it is vital to register the property in your name at the Land Office. This registration is a crucial step in establishing legal ownership and protecting your rights as the new owner. Ensure that all information is accurately recorded in the public registry, including your name, the property address, and any relevant details from the Sales and Purchase Agreement. This step not only provides you with legal documentation of ownership but also helps prevent future disputes regarding the property. Failure to register may lead to complications in asserting your rights as the owner.

Ready to start your property investment journey?

Modern architectural design of a high-rise property in Phuket, basking in the warm glow of the setting sun.

If you want to explore Phuket investment properties, we can help you. APW Group was founded by expats, for expats; building upon over 30 years of experience in property and fixed income investments.

Our team brings real, on-the-ground experience in Thailand’s property market—guiding you through everything from discovering the perfect home to securing visas and navigating local laws with confidence. We have helped over 6,000 expats progress their property portfolio in cities all over the world, including Phuket, Bali, Dubai and the UK, just to name a few.

Please get in touch to discuss your property goals with one of our experts.