Glossary, buying process

Off-plan in Thai property

Off-plan means buying a property before it is built or finished, on the strength of plans, a show unit and a contract. The buyer pays in stages during construction and takes title when the building is complete and registered.

Buyers choose off-plan for the wider choice of units, launch pricing and the ability to spread payments over the build. The price of those advantages is risk: delay, changes to the design and, in the worst case, a developer that cannot finish.

One feature of the Thai market sharpens that risk. Stage payments are not required to be held in escrow. The Escrow Act B.E. 2551 (2008) allows it but does not compel it, and few developers offer it, so instalments normally go straight to the developer. Until the condominium is registered and the unit transferred, the buyer holds a contract, not a title.

Checks worth making before paying a deposit: the developer's completed projects and finances; that it owns the land, and whether the land is mortgaged; EIA approval and the construction permit; and, for a condominium, that the contract follows the statutory standard form with penalties for late completion. Prefer payment schedules tied to construction milestones.

See the off-plan buying process and the entry on payment plans.

General guidance, not legal or tax advice. Take independent legal advice before you commit to a purchase.

Terms related to off-plan

Payment plan: A payment plan is the schedule of instalments a buyer pays a developer for an off-plan property, from reservation deposit to the final payment on transfer. Each stage is a fixed share of the price, due on a set date or at a construction milestone.
Sale and purchase agreement (SPA): The sale and purchase agreement is the contract in which buyer and seller commit to transfer a property on agreed terms: price, payment schedule, completion date, specification and who pays which taxes. Ownership passes later, on registration at the land office.
Environmental impact assessment (EIA): An environmental impact assessment is a study of a project's effect on its surroundings that must be approved before construction can start. In Thailand it is required for residential buildings and condominiums with 80 or more units or 4,000 square metres or more of usable floor area.
Snagging: Snagging is the inspection of a newly built property before handover to list defects for the developer to put right. It should be completed, and the repairs checked, before the buyer pays the final instalment and registers the transfer.