The number of foreigners who buy condominiums in Thailand is growing since it is by far the easiest option for foreigners to purchase real estate in this country. Although buying this kind of property may be quite straightforward, there may be difficulties if you ever wish to sell your condo in Thailand. The issues encountered are similar to those that arise when selling a property elsewhere in the globe, but it can be necessary to have some drafting expertise to safeguard you from potential financial harm or, at the very least, future disappointments. The worst case scenario in the sale of your condominium is the buyer’s failure to complete the transaction.
Contrary to various other countries throughout the world, the contract for the sale of a property does not contain any predetermined standard terms. A one-page agreement to a comprehensive Boston-style contract—there are many different ways to create a contract. Despite this, each contract for the sale of real estate should include a few standard safety measures. You should also put in place a few safeguards to protect you against unanticipated outcomes.
Using a Broker or Agent for Real Estate
You must decide whether it is beneficial for you to work with a real estate agent or broker as a first step. Finding your buyer locally or abroad may be made simpler for you by a trustworthy agent or broker. They have more access to the market and can screen possible purchasers, which saves you time by allowing you to respond to ad hoc queries. They may also help with the negotiations, offer suggestions and direction on the purchase, and get the best possible price for the home. You must also take into account the fact that in Thailand, agents typically charge a fee of up to 3% of the purchase price for this service.
Incorrect Price
The asking price you choose is crucial. You could have an idea based on observations of previous sales of condo units in your building or in nearby buildings with comparable layouts. As an alternative, you could choose to have the value of your property assessed by a few local surveying and assessment companies. You may also get assistance from a broker or agent with pricing. Don’t forget to reserve a price as well. This is the least amount you are willing to pay for the property.
Additional Pre-Contractual Factors
Make a note of any property flaws that need to be mentioned to a potential buyer. Keep in mind that the contract should mention any liens or obligations you have against the property. The sale and purchase agreement should expressly declare that all physical elements of the property are to be fully and honestly disclosed. Although there is no legal necessity to do so in Thailand, it greatly reduces the likelihood of future issues with your customer, especially if they are accustomed to these words being the norm in their own country. Additionally, it provides for a lot simpler move and contributes to making a good first impression on any possible purchasers.
Additionally, the broad notion of contract freedom is still upheld by Thai law. This means that parties are free to reach any agreements they choose, so long as they do not break the law or violate moral standards. The Civil and Commercial Code of Thailand, which is mainly based on notions from continental European civil law, governs the fundamentals of contract law. However, if you or your customer are better familiar with those specific sets of rules, you have the choice of choosing a jurisdiction to handle your contractual duties.
Vendor’s Recourses if a Sale Fails
When you draught a sale and purchase agreement for your home, there are a few essential components to protect yourself. First and foremost, you need to safeguard yourself in case there is a failure to finish. A contractual duty between the parties is created after a contract has been signed. As a general guideline, you should include any or all of the following provisions in your contract to protect yourself in the event that your buyer is unable to execute it. As a result, you can specify that the vendor has the following options upon contract termination:
Keep the deposit or collect it; keep certain payments made as security under the contract; file a lawsuit against the buyer to recover damages for a breach of contract.
A further clause that can collect the shortfall on resale and the reasonable charges and expenditures arising out of the purchaser’s violation of this agreement may be beneficial as an additional preventative measure before filing a lawsuit for breach. This idea of a “deficiency on resale” results from the discrepancy between the contract price and the property’s market worth as well as any additional damages that may result from the breach. In order to make the appropriate modifications in the event of a shortfall in a resale, you would take the difference between the contract price and the resale price.
Alternately, you could want to employ the formula below in your contract, which involves subtracting the contract price from the property’s worth as of the breach date and then adding any consequential damages and interest. Items like advertising charges, legal bills, rent costs, and relocation costs are examples of consequential losses.
Although neither Thai legislation nor any court precedents restrict this idea, using a phrase like this is popular in many other jurisdictions. It is far more apparent what damages may be demanded in such a situation if it is included into the agreement.
Conclusion
In conclusion, while we all hope selling property in Thailand would go smoothly, most sellers are willing to take a loss and move on to finding the next buyer if something goes wrong. This is because Thai judicial processes are quite expensive and take a long time. A clause for alternative dispute resolution is usually a good idea since, in the event of a dispute, arbitration or mediation will almost always be a faster and less expensive option than pursuing damages. Other small issues might come up while selling a home, but this article isn’t long enough to address them all. If you are unsure, your agent or broker may be able to help you; otherwise, you could want to seek the legal counsel of an experienced Thai property lawyer.
