A condominium or "condo" is basically an apartment that a person owns or buys rather than pays rent for.
It is located in a building which contains other condominums – and perhaps also apartments – and is not visibly distinguishable from an apartment building.
Condo ownership is popular among foreigners in Thailand and on Phuket Island as Thai law prohibits foreigners from owning land, and thus from owning houses.
Presently, Patong Beach, Karon Beach and Kata Beach are where the bulk of the island's condominiums are located but this is changing as they are being built all over the island.
Also, many owners of apartment buildings are tying to convert them into condominiums.
Buying a condo on Phuket Island is not so difficult if one has the required money. According to most literature on this topic, if one has 13 to 14 million baht, one can buy a wide range of two bedroom, 125 square meter condos, and one can buy 45 to 60 square meter condos for considerably less. Prices also vary considerably according to where on the island one wishes to live.
Generally, the Patong-Karon-Kata area, along with some of the more exclusive areas of the northern west coast, is the most expensive, while the east coast, and the southeastern part of the island are much less expensive.
Buying a condo is something one should not do lightly, unless, of course, one is super wealthy, but even the wealthy might want to be careful. There are several pitfalls or areas which require attention when buying a condominium, so prospective buyers need do their homework.
This is a particularly urgent matter as many people buy condominiums without actually seeing them, or while they are under construction. It is certainly wise for those who want to buy condos to hire a lawyer to guide them through the process.
Have a look here for guide on Buying condos in Bangkok, Thailand
The following are some things all prospective buyers should be aware of or concerned about:
It is only possible for a non-Thai to buy or own a condominium legally in a building where 51 percent of the units are owned by Thais.
This certainly appears not to be the case in many condominium building, so one must always be skeptical of the situation. Usually there is no problem, but the potential for a problem exists. One should insist on certification from the appropriate authorities, which includes both the building owner and the land office, that 51 percent of the units are actually Thai owned. If this is not the case, it is still possible to obtain a 30 year lease with the possibility of two renewals.
One must buy a condominum with funds transferred to Thailand from another country.
The bank should provide documents certifiying that the condo is being purchased with "legal" funds. For purposes of buying a condominimum, funds earned while working inside and paid inside Thailand are not "legal" or permitted for use. Of course, one could earn their funds inside Thailand, wire them to another country, and then wire them back to Thailand again.
One should scrutinze the background of the seller carefully to ascertain the likelihood that he or she will be in business in the future and will be able to run and maintain the condominum as promised.
One must remember that one's legal protections might differ from those one would have in their own country. If the owner of a building for some reason suffers financial difficulty and loses ownership or management of the building, one might find oneself in serious trouble. Much of this information should be on record, or ascertainable, at various Thai agencies. The assistance of a lawyer will be invaluable in this matter.
Check that the physical conditions and construction of the condominium be as presented in the sales materials.
This requires inspection by experts in construction and so forth. If one is buying a condo under construction, then it permissible under Thai law that the advertisements and promotion materials for the condo be incorporated into the contract of purchase and the seller be held to the presentations made in these materials.
Maintenance and management fees.
Buyers of condominuims in many countries are surprised and sometimes angry to learn that they must make monthly payments for such items as the maintenance of the building, swimming pools, security systems, parking lots, electrical wiring and fees, grounds maintenance, water, taxes and so forth.
These fees can exceed what many people pay in rent which makes some people wonder why they bought a condo in the first place! In any event, these fees must be examined and investigated. Buyers must demand that the seller tell them what fees they will owe and provide reasonable estimates of what the fees will be.
Various fees must be paid at the date of purchase to various government agencies.
These fees are in addition to the regular purchase price. The seller must inform the buyer about these fees and there should be agreement about how these fees will be paid and who will pay them.
Carefully consider the wisdom of signing a "reservation contact", which sellers often urge buyers to sign.
It is generally said that this contract does not actually create any rights or obligations for either the buyer or the seller but does usually involve the payment of a large deposit, which is difficult to get back should things go wrong. It is generally recommended that one forego this stage and simply pay money due at the time of actual purchase. Frankly, the urgings of sellers that buyers must reserve a condo before they are all gone are frequently just so much salesmanship.
Remember that owning a condo is not like owing a house. There might be restrictions in the contract about what one can do within the properties of the condominium building or community. The contract should be read carefully.
Difficulty of resale.
It is often difficult to sell condos. Those who feel financially insecure or who are planning to sell their condo for a profit should be very careful.