Early in almost every Phuket deal, a buyer is asked to pay a “reservation fee” or “deposit” — before any contract is signed. That’s standard practice on both the primary and resale markets. The risk isn’t the reservation itself; it’s what happens before the money moves: who gets paid, what it actually locks in, and whether it comes back if the deal falls through. Here’s the mechanics of reservations and deposits, the real ways buyers lose money at this stage, and a checklist that removes most of the risk before you pay.
Contents
- Reservation, deposit, first installment — what’s the difference
- How much a reservation costs in Phuket: examples
- Getting a deposit back: law and practice
- How buyers lose money on reservations: common scenarios
- Checklist: what to verify before paying
- Reservation vs installments vs full payment
- Pitfalls
- Mini case study
- Conclusion and next step
1. Reservation, deposit, first installment — what’s the difference
The three terms get mixed up, but they carry different risk profiles:
| Term | What it locks in | Typical size | Legal status |
|---|---|---|---|
| Reservation / booking fee | Unit pulled from sale, price locked for a short period | A fixed sum (example: 200,000 THB) | A receipt or short reservation agreement |
| Deposit | Usually just another name for the reservation fee | Same as the reservation amount | The same document as the reservation |
| First installment | Part of the price under a signed sale-purchase agreement | 30–50%, depending on the payment plan | A full sale-purchase contract |
The key line is the moment the contract is signed. A reservation exists before the contract and protects both sides while paperwork and due diligence are underway. The first installment is already a contractual obligation, and its refund is governed by that specific contract — not by verbal promises.
2. How much a reservation costs in Phuket: examples
A reservation fee is a fixed sum, not a percentage of price, and it’s usually the same across most units in a project:
- Layan Verde — a 200,000 THB (~$6,010) reservation fee locks the unit for 3 business days to sign the contract. The amount is credited toward the first installment.
- Layan Green Park, phase 2 — a similar reservation step before signing, followed by payments on the developer’s schedule (terms confirmed at booking).
- Phase-1 resales at Layan Green Park — the entire current phase-1 price list consists of owner resales, so there’s no standard reservation scheme; deposit terms and amounts are negotiated directly with the seller and must be put in writing.
The logic is consistent: a reservation is a small slice of the entry cost. On a Layan Verde studio priced from 7,833,125 THB ($235,995), a 200,000 THB reservation is roughly 2.6% of the price — the rest follows a construction-linked installment schedule.
3. Getting a deposit back: law and practice
Under Thai law, this kind of sum is most often treated as earnest money (มัดจำ, “mudjam”) within the Civil and Commercial Code. The general principle:
- if the buyer withdraws without fault on the seller’s side, the earnest money is typically forfeited to the seller or developer;
- if the seller breaches terms (wrong unit, changed price, refusal to sign the agreed contract), the buyer is generally entitled to a refund — sometimes with an extra contractual penalty on top;
- a court can reduce a sum a party tries to withhold as “earnest money” if it looks disproportionately large relative to the deal price — but counting on that as a strategy is unwise.
There’s no blanket statute guaranteeing an automatic refund “just because the buyer changed their mind.” Everything hinges on the wording of the specific document signed before the money moves. The absence of such a document is already a reason to stop.
This material is informational only and is not legal advice. Earnest-money refund terms depend on the specific contract and circumstances — engage a qualified lawyer for the transaction.
4. How buyers lose money on reservations: common scenarios
- Paying into a personal account. A transfer to an agent’s card or personal account instead of the developer’s or seller’s corporate account is the single most common cause of an unrecoverable deposit.
- No written receipt. A verbal “we’ll hold it for you” with no document stating the sum, terms and refund conditions.
- Reserving through an unlicensed intermediary. Money flows through an agent with no authority to sign on behalf of the developer or seller — the detailed patterns are covered in property scams in Thailand.
- A project without permits. A developer collects “reservations” for a project that doesn’t yet have the required construction permits — a marker broken down in developer red flags.
- Endless reservation extensions. The reservation period formally expires, but the buyer is kept “on hold” with no written extension of terms and no clear deadline to sign the contract.
5. Checklist: what to verify before paying
The check takes 1–2 days and happens before the transfer, not after:
- A written receipt or reservation agreement — unit, price, sum, deadline and refund terms on paper.
- Company bank details, not a private individual — the name should match whoever signs the future contract.
- The agent’s license and authority, if the reservation goes through an intermediary rather than directly with the developer.
- The project’s permit status — especially at an early off-plan stage, before visible work starts on site.
- The price-lock deadline — what happens if the contract isn’t signed within the allotted days: extension, refund, or forfeiture.
The broader developer and document check is a separate, more involved step that follows the reservation — covered in detail in Phuket due diligence.
6. Reservation vs installments vs full payment
Example on a Layan Verde 36.2 m² studio priced at 7,833,125 THB ($235,995):
| Stage | Amount | What it locks in |
|---|---|---|
| Reservation | 200,000 THB (~$6,010) | The unit and price for 3 business days before the contract |
| First installment (35% plan) | The sale-purchase contract, start of the payment schedule | |
| Full payment | 7,833,125 THB ($235,995) in one sum | Full settlement of the contractual obligation |
The earlier the payment, the smaller the sum — and the more the written terms matter, since there’s no contract yet at the reservation stage; the buyer is protected only by whatever document was signed. For yield math across different entry schemes, see the ROI calculator.
7. Pitfalls
- “A reservation equals ownership.” A reservation carries no title and doesn’t replace a contract — the unit isn’t legally yours until the SPA is signed.
- Currency risk during the pause. The THB/USD rate can move between reservation and signing — if the price is locked in baht, that’s not the buyer’s problem, but confirm it explicitly rather than assuming it.
- Reserving a resale without checking the assignment. On the secondary market — including phase-1 Layan Green Park resales — it matters who the actual seller is and whether payments remain outstanding behind them; otherwise the reservation is paid on an asset carrying someone else’s debt.
- A penalty for your own delay. Some reservation agreements forfeit the sum if the buyer fails to provide documents (KYC, passport, address) on time — read the obligations, not just the refund clause.
- Comparing areas without checking the specific project. Reservation terms near Layan and Bang Tao are broadly similar, but the exact sums and deadlines are project-specific — don’t carry one project’s terms over to another without checking.
8. Mini case study
An investor picked a unit remotely and was given payment details for the reservation — a sales manager’s personal account, “to move faster.” Instead of transferring, the buyer asked for a company-issued receipt and corporate bank details. It turned out the manager was working through a sub-agent with no direct agreement with the developer. The deal was redirected straight to the developer, the reservation was paid into the corporate account with a written refund clause, and the contract was signed on schedule. The extra step took two days but removed the risk of sending money to someone with no authority to accept it.
9. Conclusion and next step
A reservation fee or deposit isn’t a formality — it’s the first point of risk in a deal, precisely where there’s no contract yet and everything rests on a receipt and bank details. The rule is simple: written refund terms, a company account rather than a personal one, and verified authority for whoever you’re paying — before the transfer, not after.
I can confirm current reservation terms for a specific unit at Layan Verde or Layan Green Park and verify the payment details before you pay — leave a request or see VillaCarte Group.
