There are two main ways a foreigner can hold property in Thailand: Freehold & Leasehold
Condominiums are the simplest and most straightforward way for foreigners to own real estate, provided that at least 51% of the condo units in a given building are owned by Thais. The remaining 49% can be owned by foreigners. Condos are considered a freehold property, because you can own one completely in your own name. You should still have a good lawyer do a title check (to make sure the seller is the real owner) and draw up a purchase contract. There is a transfer fee (tax) when buying a condo, and it is part of the negotiations to determine how much of this fee is paid by the seller and buyer.
(Note, if you wish to purchase a condo in a building where the condos are NOT majority owned by Thais, you would have to obtain a 30 year lease - see below.)
If you prefer to own a detached house, it would be a leasehold property. A foreigner can obtain a 30 year lease of a plot of land, with the option to renew the lease at the end of that time. Then, if you build a house on the land, you own the house but lease the land it sits on. If later you wish to sell, you transfer the lease to the new owner, and sell the house. If you sell to a Thai, you sell both the house and land. Once again, a good lawyer is a must in such transactions. We can refer you to qualified, English speaking lawyers to advise you in every step of the process.
Forming a Thai company:
If you come to Thailand with the purpose of starting up a company to do business, you can purchase a home and land in this way. However, it is vitally important that it be a bona fide company, actually doing business, NOT a "shell" company, organized with the sole purpose to allow a foreigner to own land. This is strictly forbidden in Thai law. Also, keep in mind that you must have a minimum of 3 Thai shareholders, who own at least 51% of the company.
(We can assist you in the setting up a Thai company and refer you to lawyers who are experts in the process.)
Owning Property Through a Thai Spouse:
Another way foreigners can own property in Thailand is in the name of a Thai spouse. It is advised that the foreigner then have his spouse lease the land back to him for 30 years, renewable for up to 90 years. A prenuptial agreement should be drawn up that is satisfactory to both parties, in case of divorce.
(Note, if you wish to purchase a condo in a building where the condos are NOT majority owned by Thais, you would have to obtain a 30 year lease - see below.)
If you prefer to own a detached house, it would be a leasehold property. A foreigner can obtain a 30 year lease of a plot of land, with the option to renew the lease at the end of that time. Then, if you build a house on the land, you own the house but lease the land it sits on. If later you wish to sell, you transfer the lease to the new owner, and sell the house. If you sell to a Thai, you sell both the house and land. Once again, a good lawyer is a must in such transactions. We can refer you to qualified, English speaking lawyers to advise you in every step of the process.
Forming a Thai company:
If you come to Thailand with the purpose of starting up a company to do business, you can purchase a home and land in this way. However, it is vitally important that it be a bona fide company, actually doing business, NOT a "shell" company, organized with the sole purpose to allow a foreigner to own land. This is strictly forbidden in Thai law. Also, keep in mind that you must have a minimum of 3 Thai shareholders, who own at least 51% of the company.
(We can assist you in the setting up a Thai company and refer you to lawyers who are experts in the process.)
Owning Property Through a Thai Spouse:
Another way foreigners can own property in Thailand is in the name of a Thai spouse. It is advised that the foreigner then have his spouse lease the land back to him for 30 years, renewable for up to 90 years. A prenuptial agreement should be drawn up that is satisfactory to both parties, in case of divorce.
Title Deeds in Thailand may be mainly divided into 4 categories as follows:
Freehold Title deed: (Chanote or Nor Sor 4)
This type of title grants the holder of this document the full rights over the land. Thus, if you are planning to buy land in Thailand, this type of title deed is the best title deed to hold.
Nor Sor 3 Gor:
A land awaiting a full title deed is granted the document Nor Sor 3 Kor. The land is measured by the Land Department; therefore, it has its exact boundaries. The owner knows exactly what he owns. This type of land may be sold, transferred, or mortgaged, as a land with freehold title deed (Chanote) as long as it is ready to be a full title deed. In order to change the title to a Chanote, the owner of the land may file a petition to the Land Department to file a request to change it to a full title deed (Chanote), and the Land Department may do so if there is no opposition made against the petition.
Nor Sor 3:
The difference between this type of land title deed and the Nor Sor 3 Gor is that a land with Nor Sor 3 title has never yet been measured by the Land Department; hence the land has no exact boundaries. However, the Nor Sor 3 title may later be switched to a Nor Sor 3 Gor, then furthermore, transform that title to a freehold title deed (Chanote) in the future.
Possessory Right:
This type of title deed is least recommended. A land with a possessor y right has never been substantiated by Department, but is only recognized by tax payments at the Local Administrative Office. It is essential to bear in mind that title deeds other than one of a Chanote, is not able to register any leases against the land such as, usufructs, mortgages or superficies in order to gain or encumbrance. Although Thai Law stipulates that a foreigner may not own land in Thailand, there are alternative options to owning a land in Thailand.
Buying without an Estate Agent? Not a Good Idea
Back home, we are always told that when we invest in property, we should always invest in an area that we are familiar with. This is because property markets are affected by so many variables. It is important to know the market and manage the potential risk which may be involved in any transactions.
Investing in Thailand is no different. You will need a local expert who is experienced in real estate transactions in the local area that you intend to make your purchase. The agent knows how to communicate in Thai and they’re familiar with the location and the general geographical area. They can show you many quality properties in their inventory based on your needs and desires. Typically, a good agent will weed out the poor quality units. They want satisfied clients and they will avoid problematic developments. Think about it: you may not really know the community and it would be wise to find someone who has in-depth knowledge and experience with the property market. The most telling benefit of a using an estate agent is that they will act as a conduit between you and the seller. They will obtain a fair price for you and act on your behalf to respect your best interest throughout the entire process. Several international estate agent firms have recently established themselves in Thailand. This provides you access to the same international standard of business practice as in your home country.
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Investing in Thailand is no different. You will need a local expert who is experienced in real estate transactions in the local area that you intend to make your purchase. The agent knows how to communicate in Thai and they’re familiar with the location and the general geographical area. They can show you many quality properties in their inventory based on your needs and desires. Typically, a good agent will weed out the poor quality units. They want satisfied clients and they will avoid problematic developments. Think about it: you may not really know the community and it would be wise to find someone who has in-depth knowledge and experience with the property market. The most telling benefit of a using an estate agent is that they will act as a conduit between you and the seller. They will obtain a fair price for you and act on your behalf to respect your best interest throughout the entire process. Several international estate agent firms have recently established themselves in Thailand. This provides you access to the same international standard of business practice as in your home country.
Read more ...
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