If you are considering buying a villa in Thailand or any form of real estate that still needs to be built then you need to consider the contract even closer as you might lose your investment if anything goes wrong.
The very basics for the contract should have the following clauses in the agreement. The price! Now this might sound simply however considering that the apartment or house has not yet been built you need to pay them according to a standard which has been set. Usually in the West they would make a deposit and then again when the building is window height, another payment when it reaches the roof top and the final payment on completion. Thailand is not the same and this is where understanding where the limits has to be set for payments becomes important.
Do you pay X amount every 3 months, 6 months or is there going to be another standard. The price also has to be linked to the size of the unit or house and you need to be careful to ensure that the measurements are either internal dimension or external dimensions. This might not sound important right now however you could end up overpaying for the unit. Always allow a Thai lawyer which you has hired to view the contract. The lawyer for the developer will look after the interests of the developer and not yours.
If you are going to pay by means of repayments then you need to see what the penalty is if you default or pay late. Do you lose all your money or do you get a partial refund should anything go wrong with your finances at home. Say you are selling your home in the US or UK and are going to use the money to pay the next 3 payments with that money however the house transfer in your home country is going slow – will the developer wait and for how long and will he add interest to the late payment.
You also need to ensure that the developer is reputable. Thailand is full of half completed projects where the developers have run out of money and there is no way to recover what investors had put into the property. How will you get a refund if any if the developer goes bust? The developer would normally add this into the contract which is there to protect you the buyer.
One last matter is if there is a delay in the building. Do you get compensated for each day that the building is delayed. What penalty becomes due to your for each day that the developer is late. 5,000 Baht a day, 500 baht a day – this has to be included in the agreement.
Call our toll-free number in the US or UK if you need advice from a property lawyer with regards to your property. Speak to us online on our main website or visit any of our offices in any of the major cities in Thailand.
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