How to Buying Property in Thailand

Buying Property in Thailand, buying a home in Thailand for investment, vacation or retirement purposes may be one of the most important decisions you might make in your lifetime. Some expatriates that are looking to purchase property in Thailand are scared off by the often cumbersome restrictions relating to foreigners owning property. But, fear not – the process of buying a property from the first property search to the day you move in can be easy if you have the correct resources and information found in this brochure.

How to Buy a Condo
You can have your dreamy city or oceanfront condo in one of Thailand’s booming condominium developments. Condominium developments are popping up everywhere in Thailand to meet the demand for accessible luxurious lifestyles inclusive of multiple amenities and community.

There are condos and there are apartments. What is the difference? Condominiums are those with a condominium license that are registered under the Condominium Act (1979). Apartments are not registered under this Act. It is very important for you to know the difference and to ask talk about it with your property agent when searching for property. You should look only fort condominium units in buildings registered under the Condominium Act as these are the only ones that can be fully owned by foreigners (as long as there is a government issued title deed for unit ownership).

Condominium developments are advancing, with many new developers seeing need to provide “the full package” and meeting the need by creating new developments that exist almost as independent mini-cities that can cater to every single need you and your loved ones could have - entertainment, fitness, medical.

How to Buy a House or Villa
Do not pay any attention to those who say that it isn’t possible for foreigners to purchase property in Thailand – It is and more and more expatriates are resettling in Thailand on a permanent basis. What is important to understand is that even though you are free to own property in Thailand, you cannot own the lease on the land. Foreigners in Thailand cannot own freehold property unless it is a condominium. As a result, some expats choose to own a condominium in their name, and others who are looking to own houses or villas obtain a long term lease on the land that their house will be. Each term for a lease on land can go upto a maximum of 30 years.

Once you apply for a construction permit – you can have your ideal house or luxury villa built in your own name. You will own your dream house and have a very secure long term lease on the land.

Another route that some take in order to buy a house or villa in Thailand is the option of registering a Thai company that will hold ownership of land. Most Thai lawyers will suggest that Leases, superficies and Usufruct are the best legal structures for buying a house or villa.

Even though buying a house or villa may not be as straightforward as buying a condominium, expatriates in many of Thailand’s booming cities are filling up the housing market with new housing and villa communities increasing in demand. The market is still hungry for more houses and villas due to these and more benefits of owning a house or villa in Thailand:

 Your house/villa gives you and your family a spacious large living space
 Your house/villa provides you with a valuable level of privacy
 Your house will most probably have beautiful grounds which you can tend to and create an amazing garden that will be easy to maintain in Thailand’s tropical weather
 Your house and the maintenance of it will be fully under your control
 Your house’s value will appreciate in time

How to Buy Land
As previously mentioned, as a foreigner in Thailand, you are not allowed to own land as freehold. But there are many alternatives for how to buy land from which you can make your choice.

a. Long-term Leasehold –This is a popular way of owning land in Thailand amongst most expats because it is simple, straightforward and hassle-free if you take the correct channels with the assistance of knowledgeable real estate agents and lawyers. Long-term leasing is the most popular legal method for an expatriate to obtain land for the following reasons;

 Your land and the rights to use it can safely be acquired and registered for a maximum lease term of 30-years at the Thai Land Department. (Renewable)
 Your land’s lease can warrant for some flexibility such as including the option of reassigning the lease to someone else if you sell OR the option of subleasing to someone else.
 You can include your family members as co-signers in the contract as insurance so that if anything might happen to you, someone in the family like adult children can continue the lease to its full term.
 Even though there is no automatic right to renewal of your 30-year lease, having the right legal and real estate teams from the very beginning will guarantee you the best assurance of renewal in the clauses of the paperwork. Renewal is possible two more times giving a total of 90 years.
 With a registration fee of only 1.1% of the rental value - a leasehold is usually an extremely lowpriced option for you to be able to own land in Thailand
 The long-term leasehold is flexible in that if your situation changes and you marry a Thai national, you can always include in your agreement the option to convert to freehold and have the house in your Thai spouse’s or Thai child’s name.
 A fact that many people do not know is that even though you cannot own land in Thailand you can still own the house or villa that is built on the land. So you can obtain a construction permit in your own name once the land owner has issued you a long-term lease. This gives you some security because the land owner cannot take ownership of the property when the lease expires – the house will still belong to you under Civil Law.

b. By Marriage – If you are married to a Thai national, the two of you can purchase the land together after going through the legal paperwork that is required for that kind of purchase.

c. Thai Limited Company – Another common way of purchasing land is by setting up a Thai Limited company which will then hold the rights to the freehold land. As a foreigner you can own 49% of the company’s shares and you must have Thai national shareholders with the remaining shares (most lawyers can arrange this). As common as this method is – it is best for those know that they have a trusted group of Thai shareholders that they know will sign over their voting rights and relinquish control of their shares to you. Otherwise as the majority, they will have voting control of the company and its assets (the land). Something to remember when you make your choice – in Thailand, land is measured by Rai not by acres or square metres so make sure you make the conversion first before making your decision on the price you are willing to pay.

Something to remember when you make your choice – in Thailand, land is measured by Rai not by acres or square metres so make sure you make the conversion first before making your decision on the price you are willing to pay.

How To Register A Thai Limited Company
Since individual foreigners cannot own 100% of any businesses in Thailand, Thai Limited Companies are the most common legal structure used for doing business in Thailand. If you have a good lawyer, it will be extremely easy and fast to setup. A Thai Limited Company has to consist of a minimum of 3 shareholders and a Director. This number was changed down to 3 from 7 in July 2008. Thailand’s 1999 Foreign Business Act is where you can find most laws concerning foreign ownership of business. Despite what many may think, the Thai legal system regarding businesses and tax is molded in the same fashion as that in most of Europe and the USA. If you are familiar with any of those systems, you will find it comfortable to work in.

For your Company to remain a Thai Limited Company, your proportion of shares should never exceed 49%. However, have no fear – you can still be the sole Director with full decision-making power.