For a comprehensive and up to date over view of the subject of foreigners owning property in Thailand, we suggest the advice of a Thai lawyer and/or experienced and reputable real estate consultant.
Ownership of land in Thailand is governed by the Land Code of BE 2497 (1954), the Civil and Commercial Code, the Land Reform for Agriculture Act BE 2518 (1975), and the regulations set forth by the Ministry of the Interior.
Under strict application of the existing law it is officially prohibited for foreigners, including both individuals and juristic entities (e.g., companies or partnerships), to own land in Thailand. However, there are exceptions to the prohibition found in the law itself. There are also other methods of arranging for the purchase of land in Thailand. According to section 97 of the Thai Land Law, the definition of a foreigner includes a Thai registered company or partnership in which more than 49% of the capital is owned by foreigners or of which more than half the shareholders or partners are foreign citizens.
Although Thai law prohibits foreigners from owning land in Thailand, foreigners have the right to own a structure such as buildings, detached houses, etc. If foreigners wish to purchase land in Thailand in order to build a structure, they have two options; first, forming a joint venture with majority Thai ownership, and second, procuring a long term lease with a right of renewal.
One method foreigners can employ to acquire land or property is by forming joint venture companies with majority Thai ownership but with adequate safeguards to protect the foreigners' minority interest. If a foreigner plans to run a business in Thailand then he may purchase the land freehold through his Thai majority limited company. The land will be owned by the Thai Company, not by the individual.
Purchasing property with a limited liability company is the most popular method for foreign investors as the Articles of Association can be varied to allow greater protection for foreign minority shareholders. The regulations vary throughout Thailand, but the Land Office generally requires that Thai nationals own a majority interest in a company if they wish to purchase land legally.
Because of the barriers in place to the purchase of land by foreigners, the most effective way to acquire land that a structure (building, detached house, etc.) resides on is to purchase the land on a 30-year leasehold with an option to extend the lease for subsequent 30-year periods.
Leases are limited to 30 years, except on land for industrial purposes, which may be established for 50 years. Similarly, lease extensions are capped at 30 and 50 years respectively. Possession of the land leased for an already owned building is protected by the fact that the building rests on the land; ownership of the building is separate from the land and cannot be seized by the lessor once the lease expires. Leases exceeding three years are enforceable for only three years unless they are registered with the Land Department. Therefore, a 30-year lease must be registered with the Land department. In addition, a lease continues to be valid even in the event the property on the land is sold.
Land can be controlled through the right of possession or through title deeds and other documentation. Individuals who actually possess and use land may have the right to possess such land under the Civil and Commercial Code. The primary form of evidence for ownership of land is a title deed (Chanod or Nor Sor 4). These title deeds must be registered at the Land Department in the province in which the land is located. It should also be noted that a parcel of land may be commonly held by several individuals. A person whose name appears on a Chanoud, or Land Title Deed, has all the legal rights to that land, can produce the deed as evidence of ownership to Government officials, can prove the land has clearly defined boundaries, and can engage in legal acts upon that land as allowed by law.
Until recently, Thai nationals who married foreigners became ineligible to own land in Thailand. The understanding was that once the foreigner and the Thai national were married the land became community property; officials believed this was perhaps a too convenient way for foreigners to circumvent existing land law. At present, however, policy has changed; a Thai spouse is now legally allowed to own land in Thailand. The foreign spouse may be required to sign a letter declaring the property to be the separate property of the Thai spouse, consequently waiving any claim on the land.
Real estate in Thailand is attractive for a variety of reasons. Owning a vacation home is the dream of many. Others hope to either spend their retirement in a leased condo or make real estate purchases as a short or long term investment. While there are a variety of restrictions on foreign citizens leasing and owning property and houses or condos in Thailand, there are an equal variety of legal opportunities.
According to the Condominium Act B.E. 2522 (A.D. 1979), a condominium is defined as a building that can have its separate portions sold to individuals or groups for personal property ownership.
Foreign investors as well as other foreigners may own condominiums in the Kingdom of Thailand under the following circumstances.
Most condominium buildings allow foreigners to purchase a certain percentage of the buildings condo apartments outright (Complete ‘Free Hold’ ownership). As the condominium buildings are located in different areas around the country, they may have varying limits on the amount of units available for sale to foreigners.
What are the requirements for a foreign individual or organization to purchase a condominium in Thailand? In order to purchase a condominium certain requirements must be met, for example: 1: A foreigner has permanent residence in Thailand in accordance with Thai Immigration Law, or 2: A foreigner is allowed into or resides in Thailand in accordance with Thai Investment Promotion Law, or 3: A foreigner or foreign legal entity who brings foreign currency into Thailand, or brings in Baht currency from the account of a person residing abroad, or uses foreign currency from their deposit account. This requirement is normally met by the presentation of a Tor Tor 3 (or equivalent bank document) form which is provided by the bank receiving an incoming remittance from abroad.
In many areas of Thailand a foreigner or foreign legal entity can acquire up to, but not exceeding, 49% of the total floor area of the combined condominium units. However, more that 49% of ownership may be allowable in certain condominium buildings in Greater Bangkok and various other municipalities and districts according to Ministerial Regulations.
Most Foreigners purchase a condominium by showing evidence of an incoming remittance of foreign currency into their Thai bank account from abroad as demonstrated by a valid Tor Tor 3 form (or equivalent bank document) from a Thai Bank.
Property ownership of a condominium can be inherited if the heir to ownership meets one of the original criteria for foreign ownership. Otherwise the condominium must be sold within one year of inheritance.
A lawyer is recommended to review the documents concerning the condominium and to supervise the transfer in conjunction with an experienced and reputable real estate consultant.
Yes. Condominiums may be leased to foreigners for periods of up to 30 years and may have options to renew. Leases of greater length than 3 years are required to be registered with the Thai Government Land Department in the district where the property is located.