What Is a Sinking Fund? Thai Condo Fees and Maintenance Costs Explained

“What is a sinking fund?” It is one of the first questions almost every condo buyer asks us once they have found a unit they like, whether they are touring a beachfront tower in Jomtien or a low-rise building near Khao Takiap. In general finance, a sinking fund is money an organisation sets aside over time to cover a known future cost or debt repayment. In a Thai condominium, the term means something more specific and, for buyers, considerably more important: a one-time reserve contribution every new owner pays so the building has real cash on hand for major repairs years down the road.

Before we bring a listing to a client on either coast, our team asks for the juristic person’s latest financial statement and checks the sinking fund balance alongside the price per square metre. It is a single line on a reservation contract that buyers routinely skim past, and it can tell you more about a building’s long-term health than a freshly painted lobby ever will.

This guide breaks down what a sinking fund actually pays for, how it differs from the monthly maintenance fee, what it typically costs in Hua Hin and Pattaya, and what to check before you sign.

What Is A Sinking Fund In A Thai Condominium?

A sinking fund, sometimes called a reserve fund, is a one-time contribution that every unit owner pays when a condominium project is newly registered, or when buying into an older building that never properly collected one. The condominium’s juristic person, the legal entity every registered Thai condo must form to manage its common property, holds the fund separately from the building’s day-to-day operating account.

This is not just industry custom. Thailand’s Condominium Act B.E. 2522 requires the juristic person to collect money from joint owners both for advance running expenses and for funds tied to specific resolutions of the general meeting, and this is the legal basis condominium committees rely on when they first set a sinking fund contribution, and later, when they need to top it up. We ask our in-house legal expert to review this documentation on every resale contract before a client signs, because the wording of a building’s regulations decides how and when that top-up can happen.

Sinking Fund Vs Maintenance Fee: What Is The Difference

Buyers we work with on both coasts almost always mix up these two line items on a purchase contract, so it is worth being precise before we go further.

The short version: the sinking fund is a reserve for the building’s big, occasional bills, and the CAM fee pays for keeping the lights on every single month. Neither is optional, and a juristic person can place a hold on the transfer of a unit’s title if fees are in arrears.

The Legal Basis Under Thailand's Condominium Act

Every registered condominium in Thailand operates under the Condominium Act B.E. 2522 (1979), administered by Thailand’s Department of Lands, which gives the juristic person the legal standing to collect fees, hold funds, and enforce payment. Ordinary maintenance fees are collected in advance according to the building’s regulations, but any new or additional fund, including a fresh sinking fund top-up in an older building, needs a resolution passed at a general meeting of the joint owners.

In practice, decisions to raise a significant new reserve typically require a supermajority vote, which is one reason a building with a poorly attended annual general meeting can struggle to fund an urgent repair even when the need is obvious to everyone living there. As a buyer, you are entitled to request copies of the juristic person’s accounts, and we would encourage every client to do so before, not after, making an offer.

How Much Is The Sinking Fund In Hua Hin And Pattaya

Rates vary by development tier and age, but our experience across both coasts gives a reliable working range for what buyers should expect to see quoted.

To put that in real numbers, take a 45 sqm one-bedroom condo. At 600 THB per square metre, the sinking fund alone comes to 27,000 THB, paid once at transfer. A CAM fee of 45 THB per square metre adds roughly 2,025 THB a month, or about 24,300 THB a year, on top of that. Nationwide, foreign buyers transferred condominiums averaging 41.3 square metres in 2025, according to REIC data reported by Nation Thailand, so this size of unit is a realistic reference point for the retirees and investors we work with in Hua Hin and Pattaya.

What The Sinking Fund Does And Does Not Cover

A healthy sinking fund is there for the expenses that come around once every several years, not the ones that come around every month.

Typically covered:

• Repainting or resurfacing the building exterior

• Replacing or overhauling lifts, water pumps, and major mechanical systems

• Structural repairs to the roof, foundations, or common walkways

• Large-scale refurbishment of shared facilities such as the pool or lobby

Not covered:

• Day-to-day security, cleaning, and gardening staff, which come from CAM fees

• Repairs inside an individually owned unit

• Cosmetic upgrades that have not been approved at a general meeting

• Building insurance premiums, which are usually a separate line item

Who Manages The Fund And How To Check It Is Being Used Properly

The condominium committee, elected by joint owners and usually numbering between three and nine people, oversees how the juristic person spends both the operating budget and the sinking fund. Thai condominiums are required to hold an annual general meeting, present financial statements, and appoint an auditor, which gives owners a formal window to ask questions about the fund’s balance and any planned drawdowns.

Bangkok Post has reported that buyers of older condominiums in particular should look closely at the current level of a building’s sinking fund before committing, since an ageing structure with a thin reserve is a very different proposition from one with the same asking price and a healthy balance. We treat this as a standard part of due diligence on any resale purchase we handle, on either coast.

Buying A Resale Condo: What Happens To The Sinking Fund

If you are buying a unit that already has an owner, in most cases you will not be asked to pay into the sinking fund again. The original owner’s contribution stays with the unit and the building; it is not personally refundable, and it does not transfer to you as cash or a credit against the purchase price.

What you inherit instead is the building’s financial position. A well-managed building with a strong reserve means fewer surprises. A building that has quietly drawn its funds down over years of underfunded repairs, and now needs a special assessment, becomes your problem the moment you take ownership. This is exactly why we ask for the juristic person’s latest financial statement on every resale listing we handle, well before a client makes an offer.

What To Ask Before You Buy: A Sinking Fund Checklist

Bring these questions to any viewing, whether you are looking at condos for sale in Hua Hin or comparing units in our Pattaya condo listings.

• Ask for the juristic person’s latest audited financial statement and current sinking fund balance

• Ask when the fund was last topped up, and by how much

• Ask what share of owners are current on their CAM fee payments, since arrears quietly drain operating cash even when the sinking fund looks healthy

• Ask whether any major repairs are planned, approved, or already underway

• For an off-plan purchase, get the developer’s stated sinking fund rate in writing before transfer day

For a fuller walkthrough of the buying process itself, our complete guide to buying a condo in Thailand as a foreigner covers the ownership quota, funds transfer requirements, and title registration steps that come after this stage.

Our Take On Why This Matters More In Hua Hin And Pattaya

Coastal buildings work harder than their Bangkok counterparts. Salt air, monsoon rain, and near-constant humidity age a roof, a lift shaft, or a swimming pool pump faster on the Gulf of Thailand coastline than in an inland city condo, which makes a properly funded sinking fund less of a formality here and more of a genuine protection for your investment.

Hua Hin’s condo market still includes a fair number of older, low-rise beachfront buildings predating today’s stricter developer standards, while Pattaya’s stock leans toward denser, taller towers with correspondingly larger shared mechanical systems to maintain. Neither pattern is a reason to avoid a purchase, in Hua Hin’s condo market or Pattaya’s property market. It is a reason to read the financial statement as carefully as the floor plan, on whichever coast you are buying.

With REIC figures showing foreign buyers continuing to transfer condominiums worth tens of billions of baht a year into Thailand’s coastal provinces, a healthy sinking fund is one of the clearest, most overlooked signals that a building will hold its value for the long-term owners, many of them Scandinavian and other Northern European retirees, who make up a large share of our clients.

If you are weighing a purchase on either coast, our team is happy to pull the juristic person’s financial statement for any listing you are considering before you commit to anything. Contact us, and we will walk you through exactly what you would be buying into, sinking funds and all.