Buying Condo

[ZZZ]

I have searched the site for information regarding condo ownership transfer and found some answers to my questions but there are still a few things I would like to have confirmed.

As far as I understand the cost of the transfer is a 2.2% transfer fee, a 3% business tax if the property has been owned for less than 5 years and a few thousand bath worth of stamp fees.

What are these percentages based on; I assume it’s based on a pre-determined taxation value?

If based on a pre-determined taxation value where and how can you get hold of this value?

To buy a condo as a foreigner you need to transfer the funds for this from outside Thailand in a major currency. When the funds transfer is done you need to get a FETF from the bank, formerly called tor tor 3.

What amount do you need to transfer? Is it the predetermined taxation value or the actual purchase price?

Is it ok to transfer a larger amount? I will need to furnish the place so additional funds will be needed and I intend to transfer all the funds I need in one transfer.

How long is this FETF valid for the purpose of condo purchase?

Is the FETF cancelled for condo purchase purposes when the condo transfer is done or could you buy several condos on the same FETF?

As I understand this FETF is needed if you sell the property and want to transfer the funds outside Thailand. What happens if the property value has doubled by the time you sell the property, can you still expatriate these funds without problems?

If you sell the property and want to use the funds to buy another property do you need to expatriate the funds and then transfer them back again to get a new FETF?

It seems to be common to split the purchase price in two portions. What is the purpose of this and what are the advantages/disadvantages for the seller and the buyer?

[Firefan]

I can not remember all the answers but:

The % value is based on the ACTUAL sales/purchase value (as will be reported to land office) so no taxation value estimate involved.

You can transfer any amount and even in several lots (there IS a minimum amount per transfer needed to qualify for the FETF somebody else here can advise that. To you it will not matter as sounds like you want to transfer much more).

You can transfer as much as you want, I.e. more than purchase price - I transfered more than the purchase price in order to purchase furniture/have spending money Etc. It went in the FETF (TT3 at that time) but no problem with that - but it can not be LESS than the purchase price as the FETF would then not be accepted at purchase.

The FETF can be used for multiple purchases - it is NOT linked to a specific piece of real estate - it should simply stipulate: "for purchase of condo".

As to selling/buying and purchasing new - I would not think you would have a problem, as you have a clear paper trail (basically the 2 buying/selling contracts) that the money originally had origin abroad, and THAT is the whole purpose of the FETF.

Hope cleared SOME of it up! Cheers!

[ZZZ]

Thanks for that firefan, it clears up a few things but also creates a lot of loop holes.

As the transfer fee and tax is based on the actual transaction price I can understand why most transactions are made splitting the purchase price in two; one for the transfer and the balance straight to the seller. Still not sure if this will create any additional problems for the buyer.

So if the transfer fee and tax is based on the actual transaction price what documentation is used to prove what the purchase price was and is this price registered anywhere in the new Property Title?

If the FETF can be used multiple times it makes no sense to have the regulation that the funds must be transferred in from outside Thailand. That is if a single FETF of say 2mil can be used to buy multiple condos costing 2mil.

It makes sense that you should be able to buy a new condo from the proceeds of the sale of the initial condo. As far as I can see the paper trail must then be something like this; FETF for 2mil, buy condo for 1.5mil (as declared to authorities during transfer), sell same condo for 3mil (as declared to authorities during transfer), this will give you a balance of 3.5mil to buy a new condo without an additional FETF. Can anyone confirm this?

Still not sure what happens if you would like to expatriate the entire amount after the sell if you have made a good gain.

[Firefan]

I can not help you with the split you talk about as I paid 1 payment only (ok; down-payment and then later ONE payment) but it sure sounds like "tax considerations" to me.

In my case the buying/selling contract was used to prove the actual amount paid for the condo. It is also used as basis for the tax calculation.

You misunderstand my comments on use of FETF. 4M in the FETF; used to buy 2 condos of 2M each = no problem. But buying 3 condos of 2M each is of course a problem as you have no proof that the last 2M came from outside Thailand. You are right that it can not be re-used after you have used the full amount in the FETF.

As to selling(at profit)/buying again I hope somebody else can jump in and confirm my guess.

I have never really worried about an expatriation of my money from here after making a good gain. Again; the 2 buying/selling contracts will clearly prove where the money came from wherefore there should be no problem - but let's here from somebody who have actually DONE it;) .

Cheers!

[ZZZ]

Thanks again, I thought that was the case with the FETF just wanted it confirmed.

What I’m not clear on now is the audit trail of the FETF. When the transfer is done at the land office do they then make a note on this form that a certain amount has been used?

What I mean is that if you transfer 4mil to buy 2 x 2mil condos there need to be some indication that the FETF form is still valid for additional condo purchase.

Also if someone have sold a condo and then used the proceeds to buy another condo, what is the deal then with the FETF and what other documents are needed, anyone with experience of this?

Finally if someone has an experience with expatriation of funds after selling a condo with gains, is that still ok despite the FETF shows a lower amount was brought in?

[Khun Bob]

Hi does the transfer to thailand have to be in a foreign currency or can i transfer thai baht ?

reason i ask is that i may be able to get better rates through a currency broker in my own country

[ZZZ]

The transfer must be in a foreign currency to Thailand and must then be converted into Thai Bath and deposited into your Thai Bath account in a Thai Bank.

[TRIPxCORE]

I just so happen to have a condo to sell if you're interested.

[ZZZ]

Trip, I already have something I'm interested in but as you have experience in buying you may be able to answer my questions, see above, regarding the FETF (tor tor 3)?

[tonybinak]

Hi, i am interested inthis topic for future use and have followed the thread. The question that comes to mind is that if you sell to another non-thai won't the buyers showing that the funds came from another country be sufficient to allow you to transfer it out of Thailand? And can you get documentation to that effect?

[ZZZ]

I'm still pretty much in the dark regarding this topic, despite some answers.

Regarding your question; The fact/documentation (FETF?) that the buyers funds came from outside Thailand gives the new buyer the right to bring that money out when he sells, it will not give the present seller any rights. At least this is how I understand it.

I was hoping to get a few more answers as I'm sure there must have been someone in TV that bought, sold and then bought a new condo or expatriated the funds.

[Khun Bob]

The transfer must be in a foreign currency to Thailand and must then be converted into Thai Bath and deposited into your Thai Bath account in a Thai Bank.

<{POST_SNAPBACK}>

Could you let me know where you discovered this or where it is stated in the thai legal documentation (or whatever) ?

Thanks

[ZZZ]

The transfer must be in a foreign currency to Thailand and must then be converted into Thai Bath and deposited into your Thai Bath account in a Thai Bank.

<{POST_SNAPBACK}>

Could you let me know where you discovered this or where it is stated in the thai legal documentation (or whatever) ?

Thanks

<{POST_SNAPBACK}>

This has been stated in hundreds of posts in TV and was confirmed by my Thai lawyer. Check with any Thai lawyer and they can direct you to the relevant legal documentation.

[olideb]

Hi everybody,

I'm in the process of buying a condo with the help of Bangkok Bank's Singapore branch. The only problem I have with them is that they need a few documents to consider my application - which is perfectly normal - but one of the documents required is the SIGNED Sale & Purchase Agreement. I told them I didn't want to sign the contract with the developer before I was sure I would get the loan from them. They don't want to hear anything! It must be signed, they need evidence that I'm buying this specific condo unit and that I've paid the deposit. I thought they were joking, but they aren't...

I thought I could get around this by asking the developer to add a conditional clause to the contract stating that I would honor it only if I the loan had been approved, otherwise my deposit would be totally refunded, but the sales girl didn't seem to like that. She said she'd talk to her manager, but I haven't heard from her yet.

I've got a question regarding the FETF: all they need at the land department at the time of property transfer is one or more FETF, the sum of which must be equal or greater than the price of the condo, right?

So, if I transfer today let's say 100,000 EUR and specify it's to purchase a condo unit, I'll get my FETF with the total amount written on it. My question is: do they check what I do with this money? What if I transfer it back to my account in Europe and use my THB earned in Thailand to pay the condo? I've got my FETF, they can't complain, can they? I hope this question hasn't been discussed in another thread. If so, my apologies.

I look forward to reading your comments.

[ZZZ]

olideb, seems like no one have done this before, very little real information on the FETF here. I'm still waiting to see if I can get some more answeres on my questions above.

My take on your questions are that the developer will probably agree to the additional clause or he will loose a customer. Possibly you will need to add a time clause as well, say 30 days to get it all sorted or everything is anulled and you get your deposit back and the developer is free to sell to someone else.

As for using your money in Thailand and transfer the initial amount back there could be a problem in the future. As far as I understand the FETF serves two functions (still trying to get this sorted out) one; it's a required document when you buy a condo and secondly; You need this document if you want to transfer the money out of the country when you sell the condo.

You may also be able to use this FETF if you buy another condo if you can prove that you have sold the first one, still not sure on this.