If you are already familiar with the Thai property market or you have previously looked into buying a house in the Land of Smiles, you will no doubt have come across information with regards to if it is possible for foreigners to own property in Thailand.
It is true that there are a number of restrictions in place with regards foreign land ownership and whilst at first these restrictions may seem a little off putting for some people, generally speaking, buying or investing in property is as realistic in Thailand as it is in other popular overseas destinations.
Figures released in October 2013 by the Board of Investment state that Thailand is attracting record numbers of international investors. In addition to this, its foreign real estate market in areas such as Bangkok, Hua Hin, Pattaya and Chiang Mai is thriving, as is the tourism sector across the country, with record numbers of tourists arriving in Thailand in 2012.
If you are thinking of buying a house or condo in Thailand then as always, make sure you properly research not only the property itself but also try to get an understanding of the legal aspect involved.
Check out: Top Tips for Buying Property in Thailand
Don’t be put off by what at first sight may seem like a legal minefield.
Let’s face it, plenty of foreigners have successfully managed to invest in the property market in Thailand, without any problems.
What are the restrictions on foreigners owning property in Thailand?
Previously, apart a few very minor exceptions, foreigners were unable to legally buy a house, condo or any other kind of property or land in Thailand. However, from 1997 onwards, Thailand has relaxed its laws on foreigners owning property in the country.
Today, some restrictions still remain in place but it is now much easier for foreigners to purchase property, as Thailand’s ever expanding foreign property market shows.
In nearly all situations, foreigners are unable to own land in Thailand directly, although foreigners can take out a legally registered lease in their own name that offers them security throughout the duration of the lease. With regards to property ownership, the good news is that foreigners can own property in Thailand completely in their own name, without any restrictions whatsoever.
With regards to condominiums, foreigners can buy a condo freehold without restrictions, and indeed this is a popular option for many expats, but only in a building where more than 51% of the total number of units are Thai owned, otherwise a foreigner can only buy the leasehold.
Ways around restrictions on foreign ownership
A previously popular method involved setting up a joint venture with a Thai entity, in the form of a Thai Limited Liability Company. Under Thai law, the Thai national would need to be the majority shareholder. An agreement would then be put in place that would result in the Thai entity handing over complete power of attorney to the foreign partner, which would then provide them with a significant degree of security in the venture, and in turn in the ownership of the property.
The owners of the joint venture would then be required to complete a tax return and pay a small amount of administrative fees and taxation each year.
However, using nominee shareholders and creating joint ventures for the sole purpose of owning property is now illegal in Thailand and in recent years the authorities in Thailand have started taking steps to try and stop this kind of practice.
Long term leasehold agreements – the recommended option
Another and all together more favorable, hassle free and the recommended way for foreigners to own property in Thailand is to go down the route of opting for a long term lease, which is automatically renewable. Whilst this practice doesn’t obviously secure title ownership, long term leaseholds are incredibly common with foreigners buying property in Thailand and are also very secure.
Long term leaseholds are commonly used when purchasing property in a modern residential development in Thailand. Whilst the terms of such agreement will vary from one development or property to another, typically an initial leasehold will be taken out for a period of 30 years. Further leases could then be agreed with the land owner but these may not be enforceable under Thai law.
Find out more on foreign property ownership in Thailand
For many expats, Thailand still represents and attractive location in which to buy a house or condo. As mentioned, the property market in Thailand continues to grow, as does the its booming tourism industry.
If you are still unsure of the restrictions with regards to land ownership or would like more information on foreigners owning property in Thailand then you should seek independent legal advice from a reputable professional who has extensive expertise and knowledge in this area.
Whilst Thaivisa Property is home to the most up to date property listings in Thailand, we don’t claim to be legal experts and would always recommend speaking to a qualified legal professional to answer any questions you may have on this matter.
Where Thaivisa Property can help you with your Thailand property search is through our extensive regularly updated property listing, which features a wide range of properties in some of the most popular locations in Thailand, such as Bangkok, Hua Hin, Pattaya, Phuket, Koh Samui, Chiang Mai and Krabi.
Our Thailand Property Blog is also home to a range of useful information, hints and tips related to buying property in the Land of Smiles.