A Step-by-Step Guide for Thai Investors
Buying Property in the UK

Financing & budgeting

To ensure a successful property investment in the UK as a Thai investor, it is essential to have a solid financial plan in place. You must determine your budget, which will influence options, including property types and locations. Decide whether you plan to pay the amount in full or would prefer to finance the purchase through a mortgage. Also, consider your investment goals — whether the property is for personal use, rental income or long-term capital growth.

Those opting for a buy-to-let property expect to pay a higher deposit than those opting for a residential mortgage. Cash buyers must verify the source of funds – a mandatory requirement under the UK's anti-money laundering regulations.

Exploring mortgage options

Thai investors can obtain a mortgage in the UK. Eligibility, however, will depend on the loan-to-value ratio and income. Lenders will assess whether you can afford the mortgage based on your salary or anticipated rental income—a higher deposit, often around 10-15%, results in more favourable terms. If you plan to finance the property, consulting with a UK mortgage broker can help you navigate the requirements and process.

Gathering documentation

Correct documentation is crucial for Thai investors looking to buy property in the UK. You will need the following

• Proof of identity, usually a passport
• Proof of address, such as recent utility bills or bank statements
• Proof of funds, with bank statements or tax records that can confirm the origin of your funds to satisfy UK anti-money laundering laws

To meet legal standards, Thai nationals must have all documentation certified by a UK-based solicitor or notary.

Initiating property search

With your finances and documentation in order, you can begin the property search. Defining your criteria based on your investment goals is suggested, as London offers various property types in different locations. Determine whether you are interested in a high-end property in areas such as Knightsbridge, Mayfair, or Canary Wharf's financial district. Your selection should also depend on whether you seek high rental yields, long-term growth or a personal residence.

Understanding Ownership Structures

UK property ownership falls into three main categories: freehold, share of freehold and leasehold.

• Freehold ownership grants full rights to the property and the land it occupies.
• Share of freehold means you can share ownership with others, often seen in apartment complexes.
• Leasehold, which is common for apartments, grants ownership for a set term, typically between 99 and 125 years, with the land owned by a freeholder.

Knowing the distinctions between these ownership structures can help Thai investors make informed decisions that align with their investment goals.

Budgeting for additional costs

In addition to the purchase price, Thai investors should prepare for additional costs associated with UK property transactions. Legal fees for conveyancing range from £1,800 to £4,000, depending on the property's complexity. Non-UK residents are subject to Stamp Duty Land Tax (SDLT), which varies by property value and includes a surcharge. There may also be processing and valuation fees for those obtaining a mortgage. Leasehold properties carry maintenance fees, including service charges and ground rent. Other miscellaneous expenses, such as insurance and administrative fees, should also be factored in.

Viewing properties

Once you have shortlisted properties, Benham & Reeves helps you arrange viewings to assess them in person or virtually. We offer physical viewings that are invaluable for understanding the property's condition, layout and surroundings. However, we can also help with virtual viewings via Zoom or WhatsApp for thorough assessment if you cannot travel. Our experienced agents will also assist you with video tours, detailed photos, and floor plans to ensure you have all the necessary information before making a decision.

Making an offer

When you find a property that meets your requirements, the next step is to make an offer. Benham & Reeves can make the offer on your behalf and, once accepted, assist with securing the property. This process can involve full payment for ready properties, while off-plan properties can often be reserved with a smaller deposit, with further payments staggered across construction milestones. Working closely with our team with offices in Thailand and London ensure that your offer is presented effectively and that the reservation process is seamless.

Conveyancing process

The next step involves onboarding a UK-based solicitor or conveyancer who will manage the legal aspects of the purchase, ensure compliance with property laws and guide you through the conveyancing process. Your solicitor will review the contract, confirm the property's legal standing and handle the transfer of ownership. Working with an experienced solicitor ensures the paperwork is completed accurately and on time, minimising potential issues.

Exchanging contracts

Contracts are usually exhcanged within 28 days of reserving the property, at which point the sale becomes legally binding. At this stage, you must pay a 10-20% deposit. This deposit may be a lesser amount for off-plan properties, with payments scheduled at multiple stages of completion. This step is critical in the buying process, as it solidifies the buyer's and seller's agreement and commitment.

Inspecting the property

Before finalising the purchase, we recommend our clients thoroughly inspect the property. This process, known as snagging, involves checking for any defects or issues that may need to be addressed by the seller or developer. If needed, the agents at Benham & Reeves can handle this step for you. In the case of off-plan properties, snagging is an excellent opportunity to ensure that the property meets the promised standards. Many developers across the UK offer a guided walkthrough to confirm the property's condition, allowing you to request any necessary repairs before completing the purchase.

Completion of purchase

This step involves paying the remaining balance on completion day. Once done, ownership is officially transferred to you and congratulations are in order. You are now a proud owner of a property in London! From here on, your solicitor coordinates the final payment and facilitates the legal transfer, ensuring the property is registered in your name. This stage represents the conclusion of the purchase process, at which point you gain complete control of the property.

Paying stamp duty

Once the transaction is completed, all buyers, including Thai investors, must pay Stamp Duty Land Tax (SDLT) to His Majesty's Revenue and Customs (HMRC) within 14 days. For non-residents, please note an additional 2% surcharge applies. Depending on your residency status, there may be potential exemptions or reductions in SDLT. Your solicitor is the best advisor on this.

Arranging post-purchase services

Once you've completed your property purchase, there are still some necessary steps to ensure your investment is managed well and profitable. That's where Benham & Reeves' post-purchase services come in. We can assist you with interior design and refurbishment services through our sister company, InStyle Direct, to tailor the property to your preferences — for personal use or buy-to-let tenants.

Besides, our property management services handle everything from tenant search and day-to-day maintenance to rent collection, so you can focus on the returns without worrying about the details.