Investment Insights

A Buyer’s Guide – Real Property Rights for Foreigners in Thailand

BY Bridge Estate

Before investing in any property in a foreign country, it’s important to know your rights as an investor – especially as they pertain to local laws. Every country has different property ownership regulations, which can be confusing and frustrating at times. Therefore, we are going to take a look at the real property rights for foreigners in Thailand with relation to Land, Building, and Condo ownership.

Foreign Ownership of Buildings in Thailand
While there are certain Special Economic Promotion Zones that allow foreign entities to own land for business purposes, as a general rule foreigners and foreign entities cannot own land in Thailand. This may pose some level of inconvenience for investors, however the right of superficies under Thai law does allow foreigners to obtain ownership of a structure built on a specified plot of land without actually owning the land. This means it is possible to buy a detached house or build a structure or house of your own, as long as you go through the proper channels to lease the land on which the structure is built.
The terms of these land leases are generally for 30 years, with the potential to renew the contract once. Direct leases for properties with commercial and industrial purposes can be between 30-50 years. Therefore, it is feasible to build and own your home or office Thailand and still have time to enjoy it in the long term.
It is important to note that in order to gain ownership of a building or the right to build one in Thailand, foreigners must follow the proper procedures as outlined by Thai law. This includes registering the property with the competent local authority or Land Department.

Foreign Ownership of Condos in Thailand
Owning a condo is an attractive option for foreign investors, as it is possible to own a freehold property outright as prescribed by the Condominium Act. In order to qualify for ownership, the following conditions must be met:
• A condominium or development may only have up to 49% of its units owned by foreigners
• A foreigner must have foreign currency at least equal to the amount of the total purchase price and then exchange this into Thai Baht at a local bank
• Ownership must be registered at the Land Department
Please note that if you purchase a freehold condo and wish to sell it or transfer ownership in the future, this transfer to another foreigner is only possible if that individual also meets the above conditions.
If you find a unit that you wish to buy, but the freehold quota of 49% is already filled, it is possible to own the property as a leasehold. This still allows the buyer to be the sole owner of the unit, but it requires the signing of a 30-year agreement that has the potential to be renewed two times for a total of 90 years. Some investors find this attractive as leasehold properties often come with lower transfer fees than freehold properties, and give you the option to rent out the unit when you are not there for a period of time.
Thailand has positioned itself as a destination for international property investment. And while it may not be possible to own land outright, there are many lucrative options for investing in condos and developments or for building the house of your dreams. For more information on investing in Thailand, please feel free to contact one our many experienced agents.

 

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