What common fees are based on, and who has to pay them
Every co-owner must contribute to the common expenses in proportion to their ownership share of the common property, or in proportion to the benefit to their unit, as the by-laws provide, under Section 18 of the Condominium Act B.E. 2522.
The law names three buckets: taxes and duties; the cost of common services and of the equipment and facilities kept for shared use; and the cost of maintaining and operating the common property.
What buyers of new units rarely know is that the developer pays too. Section 18 paragraph three makes the owner of the land and building under Section 6 a co-owner of every unit not yet transferred to anybody, and requires it to contribute for those units.
So a project that has not sold out and does not pay the common fees on its remaining stock is shifting the burden onto the owners who have already transferred. That is not something to accept quietly.
Falling behind has three layers of consequence
The first layer is a surcharge of not more than 12% per year on the amount outstanding, not compounded, as provided in the by-laws, under Section 18/1 paragraph one.
The second arrives at six months in arrears. The surcharge rises to not more than 20% per year, common services or the use of common property may be suspended as the by-laws provide, and the co-owner loses the right to vote at the general meeting.
Suspension of common property in practice means the pool, the gym, and in many buildings the access card for the shared areas. Losing the vote means the co-owner who is unhappy about how the building is run no longer has a say in it.
The third layer is Section 18/1 paragraph three, which makes the surcharge itself an expense under Section 18. The interest that accrues becomes common-fee debt that has to be cleared before a transfer, exactly like the principal.
The debt-free certificate is where a small debt stops a large deal
The land officer may register a transfer of a unit only once the unit is free of debt arising from Section 18 expenses, evidenced by the most recent debt-free certificate from the condominium juristic person, under Section 29 paragraph two.
That is how THB 40,000 of unpaid common fees stops the transfer of a THB 4 million unit on the appointed day. No certificate, no registration, however ready the money is.
The law also fixes a deadline. The manager must issue the debt-free certificate to the co-owner within 15 days of receiving the request and the co-owner having paid the Section 18 expenses in full, under Section 29 paragraph three.
A seller should therefore settle the balance and request the certificate at least a fortnight before the transfer date, and a buyer should ask to see the latest common-fee receipts when signing the sale and purchase agreement rather than on transfer day. The full running order of the day is in our guide to transferring at the land office.
The exception, and why resale buyers carry the risk
The debt-free requirement does not apply to a registration of transfer made before the condominium juristic person is registered, under Section 29 paragraph four, which is the case of a new project transferring its first units alongside the registration.
In practice that means a first-hand buyer does not have to think about it and a resale buyer has to think about it every time, because a unit that has changed hands before may carry arrears from a previous owner that were never cleared.
Ask the juristic person three things directly before you pay a deposit: the outstanding balance on that unit as at the date you ask, how much surcharge has already been added, and the common-fee rate per square metre per month under the by-laws currently in force.
What the money buys
A common fee is not a charge paid to the manager. It is the building's budget, funded by the co-owners to keep the common property working: lifts, standby power, water pumps, security staff and cleaning.
A building that collects less than it needs shows it before the budget runs out. Lifts break down more often, the pool goes cloudy, and corridor lights go dark in patches, and all of it comes back to the unit price when you sell.
So the number a buyer should look at is not only the fee per square metre but the building's collection rate, which is a question you can ask at the general meeting and which should appear in the juristic person's reporting.
Frequently asked questions
How is the common fee calculated?
In proportion to each co-owner's ownership share of the common property, or in proportion to the benefit to the unit, as set out in the by-laws, under Section 18 of the Condominium Act B.E. 2522.
What interest applies to unpaid common fees?
A surcharge of not more than 12% per year on the outstanding amount, not compounded, rising to not more than 20% per year once the arrears reach six months, under Section 18/1.
Can the juristic person cut off water and electricity?
The law allows common services or the use of common property to be suspended as the by-laws provide once arrears reach six months. Utilities supplied under the unit owner's own contract with the electricity or water authority are a matter between those parties, so the building's by-laws have to be read alongside.
Can I still vote at the general meeting if I owe fees?
No. A co-owner in arrears of six months or more has no right to vote at the general meeting, under Section 18/1 paragraph two.
Can I sell a unit that owes common fees?
You can agree a sale but you cannot register the transfer, because the officer may only register once the unit is free of Section 18 debt and the latest debt-free certificate is produced, under Section 29.
How long does a debt-free certificate take?
The manager must issue it within 15 days of receiving the request and the co-owner having paid the Section 18 expenses in full, under Section 29 paragraph three.
Does the developer pay common fees on unsold units?
Yes. Section 18 paragraph three makes the owner of the land and building under Section 6 a co-owner of the units not yet transferred and requires it to contribute for them.
I bought a resale unit and found the previous owner's arrears. Who pays?
In practice the debt follows the unit, because without the debt-free certificate the transfer cannot register. The fix is to get the outstanding balance from the juristic person before paying a deposit and to write into the sale agreement that the seller clears it and hands over the certificate on transfer day.
Summary
- Common fees are apportioned by ownership share of the common property or by benefit to the unit, under Section 18 of the Condominium Act B.E. 2522.
- Arrears attract a surcharge of up to 12% a year, rising to up to 20% a year once six months are outstanding.
- At six months in arrears the co-owner may lose the use of common property and loses the right to vote at the general meeting.
- A unit cannot be transferred without the most recent debt-free certificate from the condominium juristic person.
- The manager must issue that certificate within 15 days of the request once the debt is paid in full.
- The developer must contribute the common fees on units it has not yet transferred.