Comprehending Sinking Funds, Common Area Fees, and Maintenance Fees in Thailand
Information that is beneficial for individuals interested in purchasing property in Phuket.
Additional financial obligations, including maintenance fees, sinking funds, and common area fees, are associated with the ownership of property in a Thai condominium or gated community. These fees are indispensable for the preservation of the property's condition, the guarantee of safety, and the Improvement of the Quality of Life for residents. The following is a comprehensive explanation of the fees, their purposes, and their typical costs in Thailand.
Common Area Fees
Definition: Recurring contributions that are made by property owners to cover the costs associated with shared spaces and facilities within a condominium or housing estate.
What services are included?
▪ Security Services: Ensuring the safety of residents by means of controlled access points, CCTV, and security.
▪ Cleaning and Sanitation: The consistent cleaning of communal areas, including corridors, lobbies, and recreational areas.
▪ Landscaping: The upkeep of verdant spaces, including gardens and parks.
▪ Utilities for Common Areas: The provision of electricity, water, and other utilities for shared amenities such as swimming pools, saunas, and clubhouses.
▪ Insurance: Protection against liabilities or damages in common areas.
Common Area Fees in Thailand: These fees are typically determined by the square footage of the property and can fluctuate substantially based on the quality of the development and its location, with a typical monthly rate of 30 to 80 THB per square meter.
Maintenance fees
Definition: Maintenance fees are intended to cover the routine maintenance and minor repairs of common areas and facilities, thereby ensuring that they remain in excellent working order.
What are the topics that they address?
▪ Routine Repairs: Addressing minor plumbing issues, general wear and tear, and broken lighting in shared spaces.
▪ Equipment Maintenance: Consistent maintenance of shared apparatus, including elevators and air conditioning systems.
▪ vermin Control: The implementation of consistent vermin control measures to ensure the comfort and hygiene of communal areas.
Typical Rates in Thailand: Maintenance fees may be incorporated into the common area fees or levied separately, depending on the property's management. The specific amount is subject to change; however, it is typically included in the overall monthly fee structure.
Funds That Are Sinking
Definition: An amount of money that is accumulated by property owners to cover anticipated significant repairs and replacements in the future.
What are the topics that they address?
▪ Major Structural Repairs: Substantial repairs, including roof replacements, building painting, or significant drainage issues.
▪ Major Equipment Replacement: The upgrading or replacement of air conditioning systems, water turbines, and elevators.
▪ Emergency Repairs: Repairs that are unplanned but essential and cannot be accommodated by the standard maintenance budget.
Typical Rates in Thailand: Sinking funds are typically a one-time payment that is made upon the purchase of the property. They are calculated based on a percentage of the property's value or a fixed amount per square meter, typically spanning from 200 to 500 THB per square meter at the time of purchase. Management's projections regarding future requirements may necessitate periodic contributions.
It is essential for individuals who are interested in purchasing or residing in a condominium or gated community in Thailand to comprehend these fees. The following is a detailed explanation:
▪ Common Area Fees: These fees are intended to cover the daily operational expenses of shared spaces.
▪ Maintenance Fees: Guarantee consistent maintenance and minor repairs.
▪ Sinking Funds: Reserve funds for significant future restorations and replacements.
These fees guarantee that the community is well-maintained, safe, and enjoyable for all residents, thereby safeguarding the property's value over time. It is imperative to consider these expenses and comprehend their scope in order to make an informed decision when purchasing property in Thailand.
