A property buyer must have more information about the property than what appears on a title deed examination. For instance, you may plan to buy property in Thailand that is under construction. In this case, you must confirm the necessary permissions in place, as well as ownership of the site. Due diligence is the process of researching your potential property investment. You must complete this procedure before you sign any contract. Moreover, you should do so before you make any payment on the property until ownership is transferred to you.
The property department of Konrad Legal offers a range of services geared to safeguard foreigners who are seeking property in Thailand, including our property diligence service.
The Due Diligence Service
Physical Inspection
We will undertake a physical inspection of the land in addition to the title search to determine:
- For ongoing constructions, we investigate the site. We check its connectivity to a public road and if the land’s borders are clear and consistent with the title deed. If you are unable to monitor the development, this visual check might provide you with additional peace of mind. The buyer can also check the quality of the building work done on the subject property with a visual inspection.
- We’ll verify if the property complies with local zoning regulations.
- We’ll check out who owns the pieces of land that are just next to the one you’re interested in. It is a good idea to look into who owns the majority of plots surrounding your selected property. We’ll look to see if the property complies with local zoning regulations.
Building Permits Inspection
New developments necessitate a number of approvals and official government documents. Our review is to ensure that your purchase goes successfully, including the following:
Condominium Construction Permissions
We will check to see if the type of development you wish to acquire has permission in the area. Some regions in Thailand do not allow condominium buildings. Therefore, if you are willing to purchase a condominium, we will do the necessary investigations. Moreover, we will check the land use regulations to ensure that condominium construction is possible there.
This is a fairly simple test. It is critical to understand whether the land has the permissions for development under Thai legislation. Furthermore, all new developments must have access to drainage.
Construction Documents Verification
We check the building permit to verify its proper issuance and appropriately represents the developer’s current plans. Additionally, we also check whether the developer is meeting the documentary requirements for the construction permit. Specifically, we check whether the complete architectural plan has a verification report from an eligible architect and engineer. The district office in the location of the construction issues such permits.
Initial Environmental Examination (IEE) Verification
We can check the filing of the developer’s Initial Environmental Examination (IEE) report with the provincial Office of Natural Resources and Environment. We can verify the approval of the report as well. The IEE is a preliminary environmental study of the proposed activity’s. Reasonably it impacts to determine the requirement of an environmental assessment.
It’s crucial to check the IEE report to the developer’s construction plans. It is because building plans are occasionally revised after the approval of the IEE report.
Car Parking Regulations
If you are purchasing a condominium, you will surely need vehicle parking. Thai law mandates that new condominium buildings must include a minimum number of parking spaces. We can check official records to see how many parking spaces are in the project plan and if they meet the legal criteria. Car parks typically account for 25% of overall construction expenses. Generally, they are a hidden cost in the price of a condo unit. In Bangkok, a fresh condominium building must provide one parking place for every 120 square metres of construction space.
Research of Seller or Developer Credentials
We can also look through local court records to see if:
- Whether the seller has any legal cases in the past or is currently in any court proceedings. This is to determine whether other buyers have sued the seller for default or not. This is a very dangerous situation from which every consumer must have protection. In the real estate sector, knowing the seller’s credibility is critical.
- In case the seller has a bankruptcy declaration and is on the verge of assets liquidation, they won’t be able to transfer ownership to you. The seller’s right to control the property and transfer title to the buyer is extremely important.
- Whether your developer is working on a project for the first time. In comparison to long-established real estate brands, first-time developers face frequent scrutiny.
Prior investigation into these topics may raise red flags, and you may not want to do business with that seller. It could uncover minor issues with the paperwork before purchasing. Moreover, it can also represent the difference between a good and a terrible investment. This is the most important aspect of due diligence. Before making any type of investment, such as property, make sure of the safety of your rights and interests. Moreover, this further safeguards your investment as well.
The Bottomline
For your purchase of Property in Thailand, Konrad Legal can provide a due diligence report. Our Thailand property lawyer will prepare your due diligence report. The report will include your title search report, photos of the property, and translations of construction permits. The legal parameters of the property you’re studying are captured in your due diligence report.
