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How to finance real estate investment in Thailand?

Posted by stratacoltd on June 11, 2018
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Difficulties to finance real estate investment in Thailand for foreigners

We all know how difficult it is for a foreigner to finance real estate investment in Thailand with local banks. There are few options and the conditions are very restrictive and not very interesting. Few banks can grant mortgages using their subsidiaries based in other countries like, for example, Bangkok Bank used to do it with their Singapore branch.

In most cases, banks and financial companies do not want to finance an acquisition for foreigners. By law, the money that you invest in condominiums must come from overseas. Few foreign banks allow financing to purchase a condominium. A low number of foreign investors are eligible to their conditions. UOB, for example, can give a loan to a foreigner but under certain conditions like minimum revenue etc…

In addition, MBK Group has branch offerings to finance foreign investment but again, the conditions and terms are not very appealing: ex. interest rates are higher than Thai banks (which is already very high).

finance real estate investment in Thailand

Getting a loan in your home country

An alternative solution is to get a loan in your home country to finance a real estate investment in Thailand. It is not always easy. It mainly depends on your relationship with your home banker and the collateral that you can offer them to make it a favorable proposal.

Oversea based banks cannot have any collateral in Thailand, so you will not be able to use your purchased properties in Thailand as collateral.

A strong benefit of obtaining a loan in your home country may be the access to better interest rates as Thailand banks apply high interest rates.

A downside is that you will be subject to exchange rate variations, as you will probably need to borrow money in your home country currency. You will need to reimburse in the same currency and if you use cash flow generated in THB to reimburse, you will be dependent of exchange rate fluctuations. This can result in a loss or a gain. But is very hard to predict as such operations are long term and tend to balance out over time.

Purchasing an office may be a solution to finance real estate investment in Thailand

It is possible to get financing from Thai banks to finance a real estate investment in Thailand at two main conditions:

  • Purchasing commercial real estate (office space for example)
  • Purchasing it under your Thai company

When you buy a condominium office, it eases the full process. Whether your company is under 51/49 schema, under American Treaty, or BOI Promoted – the bank will only request for your financial statement and may grant you a loan if you have a financial statement linked with your investment. Purchasing under your Thai company name means the funds do not need to come from overseas. In regards to the banks, this changes everything.

Based on our experience, banks may finance up to 70% of the Office Condominium Value. The term is usually for up to 7 years for this approach. Once it has been fully paid, the mortgage will be cleared at the land department.

Using this access to locally finance is an opportunity every entrepreneur should consider in Thailand. It can help to re-allocate your own or oversea finance and cash flow to your main activity or to personal projects.

Interest will be deductible as well, which means a tax reduction for you and your company on the 20% corporate tax and 10% dividend tax rates.


Investing in office space to save your rent makes sense for a foreigner. We firmly believe it should be considered even before buying your own residential condo because of the rarity of office condominium opportunities mentioned in the previous post. You do not need to pay for a landlord but for yourself.

In conclusion, common mistakes foreign entrepreneurs make in Thailand is to first purchase a residential condominium. At Strata Bangkok Co., ltd we think they should consider investing in commercial real estate because of easier access to financing. For more information, our team will be happy to reply to your needs.

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