Condo Purchase Chiang Mai, Work permit needed??

[Manila crit]

Good morning,

 

New member looking for some advice and I am trying to cut out the absurd amount of conflicting information I have come across..

 

My situation is that I am a British expat married to A filipino and currently we have a home in London and I have just completed a building project in the Philippines where I have been the last 5 months on a career break.

 

I have visited Chiang Mai a number of times for sports training, I am a keen cyclist and the area is ideal for my needs and there seems to be a growing expat fitness community there.

 

After my project was completed in PH I am lucky to have over budgeted and find I have some spare cash, I envisage many more trips to Thailand and Chiang Mai in the future and I was looking at taking advantage of what seems to be a very well priced Condo market.

 

This will strictly be a holiday home for us but I would like the option of allowing people to rent off me who are going to be training in the area when I am not there. 

 

Would I need any type of work permit to allow myself to rent this property as would it not be classed as a income??.

 

My understanding is that a Expat can buy a Condo in TH as long as the building has not passed a 51% expat quota, is this still correct??.. 

 

I fly back to the UK via Bangkok on the 1st November and I could very we'll get up to Chiang mai in the 7 days prior to my flight to view some properties. 

 

Worst case I would like a Condo in the region regardless as I like the area and people and my other training location would be Majorca in Spain but as prices year on year are going up and as Car rental for a week is ball bustingly expensive to the point it would cover a cheap flight into Bangkok I think long term having a place in Chiang Mai will be the best option..

 

For reference I am mid 30s as is my wife and we have a 2 year old. 

 

I do do not expect to be spending more than 30days there per year but that could change??..

 

any advice very welcome, mods please move if in incorrect forum.

 

regards

 

Edited October 12, 2016 by Manila crit

[1FinickyOne]

If you are only planning on spending 30 days per year -  - definitely rent.... What may look like cheap condos to you now, might look expensive compared to the market. It is a market where knowledge counts, properties can and do depreciate against inflation and can be near impossible to sell or rent if in the wrong location. Ownership might be much more of a hassle than you might think.

 

Save your money and invest in something you know. 

 

Just my opinion... 

[Ronuk]

This is going to be a long running thread with all sorts of claims and counter claims.....

[chiang mai]

As said earlier there will be lots of different versions on this so be prepared, here's mine:

 

as a foreigner you can buy a condo using funds brought in from overseas as long as the building has no more than 49% foreign owned units, 51% are reserved for what is known as the Thai quote - I think that's pretty much fact.

 

There is a thriving condo. rental market here, income from the rental should be declared to the tax authorities and tax paid on that income, few people do however and many operate on a cash only basis.

 

The issue of whether a work permit is required for the above has come into serious focus only recently, I believe a work permit is NOT required as long as taxes are paid.

 

There may be another issue which although not insurmountable can be aggravating and that is opening a bank account and importing funds. There have been reports that people on tourist visa's have had difficulty opening a bank account, long term visa holders don't have the same problem. You could open a non-resident account easily but that wont allow you to deposit Baht (rental income) into it although it will allow you to transfer the funds needed to purchase the condo, into the country. You may need to do some work on this aspect although different banks and branches in different parts of the country all have different answers on this point it seems. 

[mcfish]

As said earlier there will be lots of different versions on this so be prepared, here's mine:
 
as a foreigner you can buy a condo using funds brought in from overseas as long as the building has no more than 49% foreign owned units, 51% are reserved for what is known as the Thai quote - I think that's pretty much fact.
 
There is a thriving condo. rental market here, income from the rental should be declared to the tax authorities and tax paid on that income, few people do however and many operate on a cash only basis.
 
The issue of whether a work permit is required for the above has come into serious focus only recently, I believe a work permit is NOT required as long as taxes are paid.
 
There may be another issue which although not insurmountable can be aggravating and that is opening a bank account and importing funds. There have been reports that people on tourist visa's have had difficulty opening a bank account, long term visa holders don't have the same problem. You could open a non-resident account easily but that wont allow you to deposit Baht (rental income) into it although it will allow you to transfer the funds needed to purchase the condo, into the country. You may need to do some work on this aspect although different banks and branches in different parts of the country all have different answers on this point it seems. 

"You could open a non-resident account easily but that wont allow you to deposit Baht (rental income) into it "

How would they know where it came from? Ive never had issues

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[chiang mai]

Just now, mcfish said:

 

"You could open a non-resident account easily but that wont allow you to deposit Baht (rental income) into it "

How would they know where it came from? Ive never had issues

Sent from my SC-01D using Tapatalk
 

 

 

Perhaps the rules have changed over time (but I doubt it very much) but when I had a non-resident account with HSBC in Bangkok some years ago I was not able to deposit THB into it, the logic being that I didn't work in Thailand hence I couldn't be earning THB..

[mcfish]

 
Perhaps the rules have changed over time (but I doubt it very much) but when I had a non-resident account with HSBC in Bangkok some years ago I was not able to deposit THB into it, the logic being that I didn't work in Thailand hence I couldn't be earning THB..

Banks make there own rules. Just stay away from HSBC

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[chiang mai]

2 minutes ago, mcfish said:

Banks make there own rules. Just stay away from HSBC

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It's not a bank rule it's a Central Bank law, the BOT.

[mcfish]

 
It's not a bank rule it's a Central Bank law, the BOT.

Ultimately it's a bank rule as they allow it.

Where did you hear about this law? A link would be helpful otherwise it's just hearsay

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[ubonjoe]

As expected this topic has already drifted away from what the OP was asking about. 

A work permit is not really required to rent out a condo. But if you are doing all of the effort yourself you could go over the line doing it. The option IMO is to hire an agent to handle the rental that would protect you from any potential problems.

Other than bringing in the funds for the condo purchase the condo their should be no need for a bank account if an agent was used. The agent could transfer the funds out of the country to you. 

For Thai taxes unless your make more than 150k baht a year their is no tax due and then on top of that there are deductions that can be taken that can make it almost 250k baht.

[chiang mai]

19 minutes ago, mcfish said:

Ultimately it's a bank rule as they allow it.

Where did you hear about this law? A link would be helpful otherwise it's just hearsay

Sent from my SC-01D using Tapatalk
 

 

As stated earlier I held a non-resident account with HSBC in Thailand hence the rule regarding no Baht deposits was in force at that time, ergo not heresay. And without spending a lot of time looking, here's what Bangkok Bank says on the subject:

 

"Non-Resident Baht Account
A non-Resident Baht account may be useful if you plan to transfer funds to Thailand for investment purposes and intend to repatriate your funds in the future. Transactions are recorded in accordance with Bank of Thailand regulations.

Please note, this account is not appropriate for daily use as all transactions are manual and can only be made at the Head Office branch on Silom Road, Bangkok".

 

http://www.bangkokbank.com/BangkokBank/PersonalBanking/SpecialServices/ForeignCustomers/Pages/Openinganaccountnew.aspx

 

As for transferring funds direct to an agent, each to their own but frankly, I find the risk associated with that is far too high.

 

Edited October 13, 2016 by chiang mai

[bbi1]

Why the hell wold a work permit be required to lease out your own condo?? You're not working, you're just hiring an agent to find tenants and manage your property. Well, maybe if you are doing it all yourself by finding tenants, managing it yourself then yes you are technically working so maybe then you would need a WP....but how do you get a WP for managing your own rental properties?

[BritTim]

If you want a condo in Chiang Mai long term, regardless of its value as an investment, there are answers above that accurately cover the guidelines. Use an agent to collect rents. Use a non resident bank account to transfer money for the purchase.

 

Recognize, though, that it is probably a bad investment. Condos from the foreigner quota are quite a bit more expensive than condos in the Thai quota. Thus, returns from rental, which are not great if purchasing as a Thai, are worse when counting in the foreigner surcharge. Also, there is a worsening over-supply of condos in Chiang Mai. I have a friend with 5 (very nice) condos there that were all occupied a few years ago. It is now difficult to keep them rented.

[Manila crit]

Thank you all for the replies..

 

Regarding the work permit the reason I asked was I have worked in a few places around the world and many would need a permit if you are collecting "any money" even if it's on a property you own. 

 

I would not be looking at this as a "must make money" venture.. I would be looking at a very long term plan and not a buy to sell quickly to make a profit scheme, I just want a base in the area. Good to know that there is a flooded market it should make getting a deal if I go ahead far easier.

 

The idea of a agent is a good one and it was going to be something I would address later in this thread but it seems to be covered. 

 

I stated 30 days as a base finger but truthfully depending how things go it could be much longer. 

 

I do not ever envisage working in Thailand I have a decent Job in the UK along with property and a couple of investments and another home in the Philippines, it would be strictly for relaxing and if it brought in some beer money as it were then that is a bonus..

 

I know there are a large number of cyclist that head to Chiang Mai each year and I envisage it would be a "go to" location for overland travellers as it is now possible to get a Chinese transit visa which was financially out of reach of the average person over landing from Europe in years past but now it is very possible even solo.. I am involved in both of these fields with contacts etc so I would think that people would use the place..

 

Ideal location would be near the base of Doi Sutep but having looked (using the hideous local wifi in PH) it looks like there is a good selection of property in most areas of CM.

 

as also the more info and insight the better so please feel free to give any ideas you may have the feed back thus far has been great..