1. Phuket Property Payment TermsThe majority of properties in Phuket are sold off-plan or in a partly built state. Property investors should study the terms of payment carefully. Buyers will always be asked to pay a reservation fee.
This secures the property which will then be taken off the open market. Then, some time (usually 30 days) is given to allow for legal work to be completed before the first payment is due on signing of the contract. Once the first payment is made, the following payments will be split according to construction milestones.
Here is an example:
- Signing of agreement: 20%
- Completion of villa footings or pilings: 20%
- Completion of columns, floor slabs and roof frames: 20%
- Completion of villa shell, including external doors and windows: 20%
- Substantial completion of the villa: 20%
In Thailand, all foreigners wishing to buy real estate must transfer the funds to buy their property from abroad.
2. Sinking Fund
In a new villa or condominium project, each owner will pay an initial amount into a sinking fund on transfer of ownership of the property. This will be used for major renovations in future and repairs which are outside the operating budget, such as repainting the external walls of the apartment blocks or replacing the pool pump.
3. Common Area Management Costs
In a villa or condo development, specifically appointed property managers such as CBRE, will normally be responsible for managing all aspects of the common areas.
This service normally includes:
- 24-hour onsite security
- Maintenance and irrigation of all common area landscaping
- Cleaning of all the common areas i.e. stairways, paths, management office
- Cleaning of the communal swimming pool, including chemicals
- Management office, estate manager, technician and all associated ancillary costs
- Insurance for the common areas, which shall include the structure of each apartment block
- Electricity and water supply in the common areas, up to the point of connection to the individual property units
- Refuse collection
- Pest control in common areas
- Accounting, including annual auditing
The property management company reports directly to the owner's committee on a monthly basis, providing regular financial statements identifying all relevant expenses and reporting on issues concerning the management of the common area of the property. This system ensures that resort condo and villa developments are managed transparently and effectively, ensuring that the investment made by each owner is protected and enhanced.
We have further information on the Phuket Villa Market here