Can Foreigners Buy Property in Thailand?
Can foreigners buy property in Thailand? This is definitely one of the most frequently asked questions that we receive each day. You probably heard that Thai laws don’t allow foreigners to own any property in Thailand, but then you’ve seen lots of foreigners buying properties in popular destinations like Phuket, Pattaya, Samui, Bangkok, Chiang Mai or even in the Northeast. It is confusing isn’t it? Not really. Let’s make everything clear once and for all.
Other than a foreign freehold condo or apartment, a non-Thai citizen cannot own a property competed under his/her own name in Thailand. Simple as that! But why only condominium units?
How a Foreigner Can Buy a Condo or Apartment in Thailand?
Simply any type of property can be owned by 51% Thai and 49% foreigners. You can actually buy a house, villa or land, by setting up a Thai company which 51% owned by Thai citizens, 49% owned by yourself. You can find the fees, steps and other details of setting up a company in Thailand with a quick online search. We are also happy to answer your questions in this matter.
According to 1979 Thai Condominium Act, foreigners can own the freehold of 49% of the total unit space in any legally registered condo building. Let’s say, there is a condominium project of 100 equally sized units; 51 of those units can be owned by Thai citizens, 49 of those units can be owned by non-Thai citizens. The only requirement that foreigners need to meet in order to be granted a foreign freehold land title (or “chanote”) for a condominium unit is that the funds used to purchase the condominium must be transferred into Thailand from abroad, (thus the law is a very good way for Thailand to attract foreign currency to its shores). Upon receipt of overseas remittances, Thai banks will issue a Foreign Exchange Transaction Form (FETF) which needs to be presented at the land office when transferring a unit.
Typically, in any condominium building that is in a destination popular with foreigners, the 49% foreign freehold quota will be filled first. Foreigners can still purchase a unit on the Thai side of the quota but the ownership of this unit will remain with the developer (usually a Thai company) which will then lease the condo for a period of 30 + 30 +30 years. A 30-year lease is the longest lease that currently be issued under Thai law so each 30-year lease needs to be renewed.
Most developers selling new condominium projects charge a premium for the buyer who wishes to own the unit under the foreign freehold land title. This is mainly done for two reasons: Firstly, developers wish to discourage foreign buyers to a certain extent from purchasing the foreign freehold so they are not left holding the generally less desirable units which can only be leased to foreign buyers. Secondly, A foreign freehold condo has a higher resale value in comparison to the resale value of a lease.
Can a Foreigner Buy Land, House or Villa in Thailand?
Buying other types of properties in Thailand via setting up a Thai company is a very common way. There are thousands and thousands of land parcels and properties owned under the company structure. Many legal consulting companies offer this type of services to foreigners at very reasonable rates. This way you can own any type of property in Thailand under your own company name. You can also use this company to setup an actual business, get a work permit or visa that will allow you to stay in Thailand legally so it is possible to kill two birds with one stone. Owning an asset will also increase the company’s credibility for future business actions.
Another way for a foreigner to own property by proxy is via a Thai citizen such as a spouse, or trusted partner. This has obvious drawbacks and comes down to a personal decision.
What is a Leasehold Title?
As mentioned above briefly in relation to condominiums, another way for a non-Thai to own property in Thailand is through the purchase of a lease. This is the cheapest and easiest way to own property in Thailand. Thai laws don’t allow anyone to lease a property more than 30 years. It is possible to sign extendable contract for 90 years which will be 30 + 30 + 30 years. This can be prepared by a lawyer easily. Important part to be careful with is to make sure all the data and information on the title deed is correct, and the land you are leasing has the proper title. It should have a correct contract duration, purchaser’s rights to resell it and the registration fee.
Do You Still Have Hesitations?
According to official statistics more than one billion Thai Baht is invested yearly in Thailand by international buyers. Even though it is a big decision to make, and a big step in your life, don’t forget that thousands before you have invested. Thai law is also very strong and clear in relation to ownership rights. We recommend that you do homework, get all the information straight, find a good property agent and a good lawyer to help you go through the final part of the process. For ethical reasons we don’t recommend a specific lawyer, however, there are very trustworthy and professional law firms out there that you can find with a quick research.
If you have any questions please do not hesitate to contact us. We provide free consultation and no obligations to use our service. Happy to answer all your questions.