The process for selling a property in Bangkok, Thailand, involves many steps. It’s important to note that real estate procedures may vary, and it’s advisable to seek professional advice and assistance from an experienced Real Estate professional to ensure a smooth transaction. Below is a general overview of the selling process:
Valuation of the Property
Begin by determining the market value of your property. You may hire a professional appraiser or consult with Real Estate Agents to get an estimate. The Real Estate Agent should be able to give you an approximate selling price (or at least a range in which it should be priced) and also advise you of the costs involved in transferring the property to a new owner. The additional costs may include government taxes, transfer fees, stamp duty and agent’s fees. These additional costs will need to be included when deciding on the selling price!
Engage a Real Estate Agent
Many property owners choose to work with a Real Estate Agent to facilitate the sale. Agents can help with marketing, negotiations, and navigating legal aspects of the transaction. See What Does a Real Estate Agent do in Bangkok.
Prepare the Property for Sale
Ensure that your property is in good condition for potential buyers. This may involve making repairs, cleaning, and staging the property to enhance its appeal. You may want to upgrade the kitchens or bathrooms to increase the selling price or increase the marketability of the property!
Marketing the Property
Create a marketing strategy to attract potential buyers. This may include online listings, signage, and collaboration with real estate agencies. Which Agent do you want to use? Do you want to give a sole agency to one agent and if so for how long?
Negotiations
When potential buyers show interest, negotiations will take place. Your Real Estate Agent can assist in this process to ensure a fair and favorable deal.
- What is included in the sale, just the property or furniture also?
- Does anything need to be done to the property by the seller to get acceptance by the buyer?
- How will the buyer pay, cash or bank loan? If a bank loan the bank may need to inspect the property!
- What is the Deposit amount?
- Taxes and Fees at the Land Department, who pays what?
Sale Agreement (Reservation Agreement)
Once an agreement is reached, a reservation agreement is sometimes signed, and a deposit is made by the buyer. The deposit can be made directly to the seller of the property or deposited in an Escrow account until completion of the transaction. The deposit can typically be around 10% of the purchase price for the property but may be higher or lower as agreed between the two parties. The agreement outlines the basic terms and conditions of the sale.
Due Diligence
The buyer will conduct due diligence, which may include property inspections, title searches, and other investigations to ensure that there are no legal or structural issues with the property.
- The seller may need to supply a copy of the accounts for the building from the Condominium management (Juristic Person).
- The buyer will need a copy of the Title Deed (Chanote) to confirm ownership and details of the property
- If a foreigner is buying a condo unit he will need to check that there is space on the ‘Foreign Quota’ for the condominium building.
Purchase and Sale Agreement (PSA)
After successful due diligence, a Purchase and Sale Agreement (PSA) (sometimes called a Sales and Purchase Agreement) is drafted. This comprehensive document includes all the terms and conditions of the sale. The PSA can be produced by either the seller or the buyer or the Agent or their legal representatives. It usually has fairly standard clauses. Both the buyer and seller, along with their legal representatives, review and sign the PSA.
Transfer of Ownership
The buyer and seller, or their legal representatives, attend the relevant Land Department in the area to transfer ownership officially. All necessary documentation, including the PSA, ID card or passport, and other relevant paperwork (original Title Deed, spouse’s agreement to sell, foreign quota confirmation letter, confirmation that all bills have been paid by the seller, cheques and cash for the payment of taxes and fees etc) is submitted.
Payment and Handover of the Property
Upon the buyer’s final payment, the property is formally transferred to the new owner. At this stage, the transfer of utilities and other essential services is also concluded. Either the buyer’s legal representative or the agent coordinates with the seller to facilitate the transfer of utility accounts (such as electricity, water, and telephone) into the buyer’s name. While the seller can handle this process, it is advisable for the buyer to request a Power of Attorney from the seller, allowing the buyer’s representative to execute the transfer on their behalf. This precaution is crucial, as such matters are occasionally overlooked once the property sale is finalized.
Government Tax and Fees
Both the buyer and seller are responsible for certain taxes and fees associated with the property transfer. These may include a transfer fee, specific business tax, stamp duty, and withholding tax.
Post-Sale Responsibilities
Notify relevant authorities and service providers about the change of ownership. This includes utilities, local authorities, and any other relevant parties. Often the Real Estate Agent is willing to help with doing this.
It’s crucial to work with professionals such as real estate agents, legal advisors, and possibly translators, especially if you are not fluent in Thai, to navigate the complexities of the property sale process in Bangkok. Legal requirements and procedures may change, so it’s advisable to consult with local experts for the most up-to-date information.