Due diligence is the part of the transaction where most things that go wrong are caught. It is also the part most foreign buyers shorten or skip — driven by deadline pressure, agent assurances, or budget reluctance to pay lawyer fees on top of everything else. The shortened version saves THB 50,000–100,000 in lawyer fees and exposes the buyer to losses measured in millions.
This article is the working checklist your lawyer should be running through. Use it to verify they are doing the work — and to understand what each item is checking for.
What due diligence is for
Three goals:
- Confirm the seller can lawfully sell what they’re selling. The seller is the registered owner, has authority to transfer, has no impediments (marriage, court order, creditor claim).
- Confirm the property is what it appears to be. Title type, area, boundaries, building permits, foreign quota status, building-management debts, easements all match the marketing.
- Surface any legal or practical problem before money is committed. A transaction that should die for cause should die before deposit — not after transfer.
A properly-run due diligence either produces a green light to close, a defined list of items to fix before closing, or a clear basis to walk away with reservation fee refunded.
Pre-due-diligence — what to have in hand
Before due diligence formally starts, gather:
- Reservation agreement with refund-on-defect clause. The reservation agreement should specify that defects discovered in due diligence make the reservation refundable. Without that clause, your reservation fee is non-refundable even if title is bad.
- Sale and Purchase Agreement (SPA) draft. Review the draft before due diligence so the lawyer can flag contract-specific issues alongside title issues.
- Property identifiers: title deed number (Chanote/condo unit certificate), unit number, project name and registration name (sometimes different).
- Seller information: name on title (verify this matches the named seller), passport or ID, marital status, and corporate documents if seller is a juristic person.
- Asking price and proposed transfer date.
Section 1 — Title verification
The foundation of any Thai property due diligence. Items the lawyer pulls and verifies:
Title deed authenticity
- Pull a current Land Office copy of the title deed (called a “back of title” or lang chanote). The copy is dated and stamped by the Land Office. A title deed copy that is more than 30 days old is stale.
- Verify the title type — for villas and houses, only Chanote (Nor Sor 4) gives full registered ownership with surveyed boundaries. Weaker titles (Nor Sor 3 Gor, Nor Sor 3, Sor Kor 1) have varying levels of registration and survey, and not all are mortgageable, transferable to foreigners’ juristic structures, or dispute-resistant.
- Compare the seller’s claimed title against the Land Office copy. Mismatches in name, area, or registration date are red flags.
Owner verification
- The current registered owner matches the named seller.
- For individual sellers: passport or Thai ID matches the title.
- For company sellers: corporate certificate, board resolution authorizing the sale, signing officer authority, current good-standing status with the Department of Business Development.
- For Thai-spouse sellers: marital status declaration, foreign-spouse acknowledgment of separate-property nature of the asset (relevant if structure crosses with Thai-spouse purchase rules).
- Power of attorney if seller appears by proxy: notarized, recent, scope covers the sale.
Area and boundaries
- The registered area on the title matches what’s being sold (and what’s marketed).
- For land with boundaries: physical boundary markers correspond to the title’s registered survey.
- For partial-plot purchases: a proper sub-division survey has been registered.
- Any encroachments (fence on neighbor’s land, neighbor’s structure on yours, public easement crossing the plot) are identified and addressed.
Section 2 — Encumbrances and registered rights
The back of the title shows everything registered against the property. Items the lawyer reviews:
Mortgages
- Any registered mortgages must be discharged at or before transfer. Verify the discharge mechanism in the SPA — typical pattern is the buyer’s funds at the Land Office go partly to the mortgagee bank to discharge the mortgage simultaneously with transfer.
- Outstanding mortgage amount, mortgagee identity, and discharge process must be confirmed in writing by the mortgagee bank before transfer day.
Leases
- Any existing leases registered against the title transfer with the property — the new owner takes subject to them.
- Verify all registered leases match the marketing (e.g., the property isn’t actually subject to a 30-year lease to someone else that the seller forgot to mention).
- Tenant rights survive the sale.
Court orders, liens, attachments
- Civil court orders attaching the property as security for a judgment.
- Tax liens from unpaid Land and Building Tax or other obligations.
- Criminal forfeiture orders.
- Any of these need clearing or accepting as transferred encumbrance before closing.
Easements and rights of others
- Registered easements (rights of way, water access, utility easements).
- Registered usufruct, superficies, or habitation in favor of others.
- Public-purpose easements (drainage, road widening reservations).
Foreign quota status (condos)
- For condominium units, the foreign-quota letter from the juristic person, dated within 30 days, confirming that registering this unit to a foreigner will not exceed the 49% cap.
Section 3 — Building-management and project-level checks
For condos and managed villa estates, problems at the project level affect every owner.
Juristic person (condo management) standing
- Juristic person registered and in good standing.
- Most-recent AGM minutes — what was discussed, was it contentious, are there pending issues.
- Sinking fund balance — adequate or under-funded.
- Last three years of financial statements.
- Any major capital projects upcoming (building re-painting, lift replacement, structural work) that will trigger special assessments on owners.
Outstanding fees on the unit
- Common area maintenance (CAM) — current and historical.
- Sinking fund contributions — current and historical.
- Utility deposits and consumption.
- Any other levies. Outstanding fees transfer with the unit unless cleared at transfer. Get a “debt-free certificate” from the juristic person dated within 7 days of transfer day.
Building rules and restrictions
- Pet policy, short-term rental policy, modification rules, party-wall obligations.
- Specific project restrictions that affect intended use (especially if buying for STR — many condos restrict daily rentals at the building level even when the Hotel Act would technically allow them).
For villa estates
- Estate management company standing and fees.
- Shared facility (pool, gym, gate, security) maintenance status.
- Estate-level rules and architectural restrictions on modifications.
Section 4 — Compliance and permits
For the property and its construction:
- Building permit for the structure as built, matching the actual building footprint and uses.
- Occupancy permit (or its absence flagged).
- Condominium juristic registration (for condos) — confirms the building is properly registered as a condominium under the Condominium Act, which is a precondition for foreign freehold ownership.
- Environmental Impact Assessment (EIA) for projects above the threshold (typically 80+ units or 4,000+ m² building area) — confirm an approved EIA exists.
- Land use compliance — the property is zoned for residential use (or whatever its intended use is).
- Setbacks and area compliance — the building doesn’t violate setback requirements or maximum building coverage.
Phuket-specific: the 30-meter coastline setback (Phuket Town Plan and various Tambon-specific rules) is heavily enforced. Beachfront buildings that don’t comply have been ordered demolished. For any beachfront purchase, verify the setback compliance in writing.
Section 5 — Off-plan-specific checks
If buying off-plan from a developer, the due diligence extends to the developer and the project itself.
Developer financial standing
- Corporate registration, paid-in capital, recent financial statements.
- Other completed projects — visit at least one. Talk to owners.
- Any litigation, bankruptcy filings, defaults on prior projects.
- Bank financing arrangements for the current project.
Project status
- Land owned outright by developer, or under what arrangement.
- Construction permit issued, EIA approved.
- Construction progress matches the schedule for the deposit you’re being asked to pay.
- Escrow arrangements for buyer deposits — Thailand’s Real Estate Escrow Account Act 2008 provides optional escrow protection but it’s not mandatory. Verify whether escrow is in place.
- Timeline to completion realistic — Phuket has multiple cases of off-plan projects significantly delayed or never completed.
Sale and Purchase Agreement specifics
- Penalty for late completion (per day or per month).
- Refund mechanism if completion is more than X months late or never happens.
- Specifications of the unit/villa locked in (changes from “subject to revision” to specified).
- Foreign quota provision — what happens if the building hits 49% before your registration.
- Defect warranty period (typically 1 year for finishes, 5 years for structure).
Section 6 — Phuket-specific items
Three items that come up disproportionately often in Phuket due diligence:
Easement disputes
Many Phuket properties — especially older villas and properties in semi-rural areas — were built with informal easement agreements for access roads, water connections, and views. These weren’t always registered. When the seller’s neighbors change (new owner of adjacent property), the informal agreement can be revoked.
The lawyer should verify:
- Legal road access (registered easement, public road frontage, or registered right of way)
- Water source legality (municipal connection, registered well, or registered private water-supply easement)
- View easements (rare, but high-value where they exist)
- Boundary agreements registered (not just verbal)
Unauthorized construction
Phuket villas often have additions built after the original occupancy permit — extra rooms, pool extensions, balconies. If the addition wasn’t permitted, it’s technically subject to demolition order.
The lawyer should:
- Compare the current building footprint against the original building permit
- Identify additions and verify they were properly permitted
- Flag any unpermitted construction for negotiation (price reduction, indemnity from seller, or demolition before transfer)
Hotel Act exposure (STR-investment properties)
If buying for short-term rental investment, verify:
- Building’s STR licensing status (juristic-person hotel license? legal short-term rental permission?)
- Any pending or recent enforcement actions against the building
- Marketing claims about STR yields are based on legal operation, not grey-market
See Short-term rental in Thailand — Hotel Act 2004 reality and Phuket enforcement for the broader regulatory picture.
Output of due diligence
The lawyer should deliver a written due diligence report at the end of the process. The report should:
- Summarize each item checked and whether it’s clean, conditional, or problematic
- Identify any items that need fixing before closing (with how to fix and who is responsible)
- Identify any items that are deal-breakers (where to walk away)
- Recommend SPA modifications based on what was found
- Conclude with: clear to proceed, proceed with conditions, or do not proceed
Read the report. Don’t accept a verbal summary. Don’t sign the SPA before reading it. If the report identifies issues, push the closing date until they’re resolved or accept the consequences in writing.
What to skip if your time is limited
If you can only do three things in due diligence (the rest absent):
- Pull a fresh Land Office title copy and verify the seller is the registered owner with no major encumbrances.
- For condos, get the foreign-quota letter and the debt-free certificate from the juristic person, dated within 7–30 days.
- For villas, verify legal road access and water access are registered (not informal).
These three catch most of the catastrophic failures. Everything else can typically be recovered from financially.
The full transaction sequence: How to buy property in Thailand — step-by-step guide for foreigners. Title types and what each gives you: Chanote (Nor Sor 4 Jor) — the strongest land title in Thailand. Foreign quota mechanics: The 49% foreign quota in Thai condos — how it actually works.