Between 2024 and 2025, Phuket Land Office data shows that over 280 new condominium and villa projects received construction permits on Phuket alone. Not all will be delivered on schedule. Not all will meet the quality standards described in sales materials. As an on-the-ground analytical team, we verify developers and projects before any capital is committed.
Our due diligence methodology rests on 7 measurable steps applied consistently since 2019. Each step carries defined warning thresholds. Below we set out the framework that separates a credible development from one carrying elevated risk.
Quick answer
- We assess developer track record: number of completed projects, average delay in months, and finish quality verified through on-site visits
- We analyse construction financing structure - projects backed by a Thai bank loan (Bangkok Bank, Kasikornbank, SCB) carry materially lower completion risk than those funded exclusively from buyer deposits
- We verify permit completeness: EIA (Environmental Impact Assessment), construction permit (Ror. 1), and Chanote land title
- Thailand does not operate escrow accounts for foreign property buyers - we focus instead on realistic safeguards: payment schedules tied to construction milestones, penalty clauses, and the developer's balance sheet
- A delay of more than 6 months on a prior project is treated as a warning threshold in our assessments
- A payment schedule demanding more than 40% of the purchase price before foundation completion is classified as aggressive and high-risk
Options and scenarios
Step 1 - Developer track record
We monitor the delivery history of every developer we assess. As of Q1 2026, more than 150 developers active on Phuket and Koh Samui are marketing projects to international buyers. The indicators we weight most heavily are:
- Number of completed projects - we treat a minimum of two delivered developments as the baseline requirement
- Average delay in months - up to 3 months is considered normal within Thai construction conditions. Beyond 6 months we flag the developer as elevated risk
- Scale of operations - a developer with five or more completed projects and a combined value above 500 million THB has a statistically lower probability of abandoning a build
We physically inspect buildings completed 2-3 years ago. That window is when structural defects, waterproofing failures, and MEP quality issues become visible.
Step 2 - Construction financing structure
This is one of the most consequential elements of our analysis. In Thailand we observe two primary funding models:
- Model A - bank construction loan: the developer holds a credit facility from a Thai bank. The bank has conducted its own project review, which adds an independent filter. Based on our estimates, approximately 30% of internationally marketed projects on Phuket use this model
- Model B - buyer-deposit funded: construction is financed entirely from incoming purchaser payments. Risk grows proportionally to the share of buyer funds in the construction budget. Absence of disclosed bank financing is treated as a risk factor in our reports
We ask developers directly about their funding sources. Evasive or absent responses register as a warning signal.
Step 3 - Permit completeness
We review the following documents for every project:
- Chanote (Nor Sor 4 Jor) - full land title. The only acceptable title type for condominium investment
- Construction permit (Ror. 1) - issued by the local building authority (Tessaban or OrBorTor)
- EIA (Environmental Impact Assessment) - required for buildings exceeding 80 residential units or 4,000 sq m of floor area. A missing EIA where one is legally required invalidates the construction permit
- Developer business licence - registered with the Department of Land under the Condominium Act B.E. 2522
In our practical experience, approximately 15% of projects we reviewed on Koh Samui during 2025 had incomplete permit documentation.
Step 4 - Contract terms and payment schedule analysis
We review purchase agreements for the following buyer-protection provisions:
- Payment schedule tied to construction milestones - the standard model we consider acceptable: reservation (50,000-200,000 THB), contract signing payment (20-30%), tranches linked to construction stages (foundations, structure, roof, fit-out), and a final payment at handover (10-30%)
- Penalty clauses for delay - we look for provisions imposing daily penalties of 0.01%-0.05% per day for each day beyond the agreed completion date
- Right to rescind with deposit refund - critical if delay exceeds 6-12 months
- Material and finish specification - attached as a schedule to the contract, not as general marketing descriptions
Warning threshold: if a developer requests more than 50% of the property value before above-ground structural work begins, we recommend heightened caution.
Step 5 - Construction site inspection
For developers with projects currently under construction, we conduct physical site visits. We assess:
- Actual progress against the declared programme
- Presence of heavy plant and crew headcount
- Quality of materials in use (concrete grade, reinforcement steel, insulation)
- Presence of site engineering supervision
For projects in districts such as Bang Tao, Layan, and Kamala on Phuket, and Bophut and Maenam on Koh Samui, we conduct visits at regular intervals and compare progress against previous inspections.
Step 6 - Market context analysis
We assess whether the project's location and pricing reflect market fundamentals:
- Average price per square metre by district - as of Q1 2026, Bang Tao condominiums are trading at 90,000-150,000 THB per sq m in our data sets
- Market saturation - the number of competing projects within a 2 km radius
- Short-term rental potential - per AirDNA data, Bang Tao and Surin achieve 65-75% occupancy during the high season, a figure that informs our yield projections
Step 7 - Reputation and financial standing verification
We verify developer financial health through:
- Available records from the Department of Business Development (DBD), covering registered capital, net profit, and net loss
- Litigation history via the Central Bankruptcy Court and related proceedings registry
- Direct feedback from owners in completed projects, gathered through on-site interviews during our building inspections
Comparison table
| Parameter | Low risk | Moderate risk | High risk |
|---|---|---|---|
| Completed projects | 5 or more | 2 to 4 | 0 to 1 |
| Average delay | Under 3 months | 3 to 6 months | Over 6 months |
| Construction financing | Bank construction loan | Mixed sources | Buyer deposits only |
| Payment before foundations | Under 30% | 30% to 40% | Over 40% |
| EIA and permits | Complete and verified on-site | Complete, not independently verified | Incomplete |
| Delay penalty clause | Yes, from 0.01% per day | Yes, but low rate | No clause present |
| Right to rescind | Clearly defined | Vague wording | Absent |
| DBD financials | Net profit, strong capital base | Neutral balance | Net loss or no data |
Risks and mistakes
Across our analytical casework, we observe the following patterns most frequently:
- No developer verification before paying the reservation fee - approximately 60% of the enquiries we receive involve projects where the client has already paid a reservation deposit without prior analysis
- Confusing marketing renders with contractual commitments - architectural visualisations carry no legal weight. What counts is the technical specification attached as a schedule to the purchase contract
- Assuming buyer-protection mechanisms equivalent to those in European markets exist in Thailand - they do not. The practical safeguards are a milestone-linked payment schedule and contractual penalty clauses
- Ignoring THB exchange-rate exposure - between 2022 and 2025, the Thai baht moved within a range that, at the extremes, could absorb an entire year of net rental income for a foreign buyer holding another currency
- Overlooking ongoing ownership costs - common area maintenance fees on Phuket average 40-80 THB per sq m per month, and sinking fund contributions typically amount to a one-time 500-800 THB per sq m at handover
- Selecting the cheapest project without analysing location yield dynamics - a unit in Rawai priced at 2.5 million THB and one in Kamala at 5 million THB can generate similar net rental income, because occupancy rates and daily rates differ substantially between those two markets
- Skipping Koh Samui-specific risk factors - the island's reliance on ferry transport for building materials, smaller pool of specialist tradespeople, and drainage challenges during the monsoon season all contribute to an average delivery delay of 1-2 months longer than comparable Phuket projects, based on our data
FAQ
How do we verify a developer's track record in Thailand?
We cross-reference DBD records online, conduct physical visits to the developer's completed buildings, and gather direct feedback from owners currently living in those projects. We require a minimum of two delivered developments and an average delay not exceeding 6 months before considering a developer low risk.
Are there escrow accounts for foreign buyers in Thailand?
No. Thailand does not operate escrow accounts for foreign property buyers in the sense used in European or North American markets. The practical protection mechanisms are a construction-milestone-linked payment schedule, contractual delay penalties, and the right to rescind the contract if delays exceed agreed thresholds.
What is the maximum acceptable delay on a developer's previous projects?
In our benchmarking, a delay of up to 3 months falls within normal tolerances for the Thai construction environment. Above 6 months we classify the developer as elevated risk. Above 12 months we recommend against proceeding with the investment.
What payment schedule structure is considered safe for off-plan purchases?
A structure we consider acceptable: reservation (50,000-200,000 THB), 20-30% at contract signing, tranches of 10-15% each linked to defined construction milestones (foundations, structural frame, roof, fit-out), and 10-30% at key handover. Any schedule demanding more than 40% before foundation completion is a warning threshold in our framework.
What is an EIA and when is it required on Phuket?
An Environmental Impact Assessment is a statutory report required for buildings exceeding 80 residential units or 4,000 sq m of total floor area. On Phuket, environmental protection zones can make requirements more stringent than the national baseline. A missing EIA where legally required renders the construction permit invalid.
How do we assess a developer's construction financing?
We ask directly about funding sources and seek documentary confirmation. A construction loan from a Thai bank - Bangkok Bank, Kasikornbank, or SCB - is a positive signal, because the bank has independently assessed the project's viability. Absence of any financing disclosure is recorded as a risk factor in our reports.
What does professional due diligence on a Thai developer project cost?
Our project analysis covers document verification, on-site inspection, and a written report. Independent Thai legal review typically costs 30,000-80,000 THB (approximately 3,500-9,400 USD equivalent, depending on transaction complexity and the scope of legal opinion required).
Which Phuket districts carry the lowest developer delivery risk?
Bang Tao, Layan, and Kamala concentrate the highest proportion of developers with multi-project track records. Based on our 2025 data, those three districts recorded approximately 70% of projects delivered with a delay under 3 months, compared with roughly 55% for the island overall.
Should investors consider developers with no completed projects?
In our risk framework, a developer with zero completed projects automatically enters the high-risk category. That does not mean every such project should be rejected, but it demands deeper scrutiny: verification of own capital, management team credentials, and funding sources. We recommend a maximally conservative payment schedule in these situations.
How do Koh Samui off-plan purchases differ from Phuket?
Koh Samui presents specific structural risks: reliance on ferry logistics for building materials, a smaller pool of qualified contractors, and recurring drainage issues during the rainy season. Projects on Koh Samui average 1-2 months longer delivery delays than comparable Phuket developments in our data sets.
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