Can foreigners buy property in Thailand?
Can foreigners buy property in Thailand? A comprehensive guide
Thailand has more than its vibrant street food and bustling city life that captivates the hearts of many foreigners. The possibility of a permanent stay becomes quite appealing, which begs the question – can foreigners buy property in Thailand?
Buying property in Thailand as a foreigner can be tricky. But don’t worry. In this guide, we’ll give you all the info you need to confidently tackle the Thai property market.
Before you decide to spend your hard-earned savings on a beautiful beachfront property, it’s crucial to understand Thailand’s property laws. These rules can prevent you from getting into challenging situations later on.
So, can foreigners buy property in Thailand? Well, yes and no. If you’re not Thai, you can’t buy land in Thailand. The laws are clear and prevent foreigners from owning land in the country. There are, however, ways you can legally own property in Thailand. These include:
1. Purchasing a condo
Luckily, if you’re keen on buying a property in Thailand, the country’s law, specifically the 1979 Thai Condominium Act, allows foreigners to buy condominiums. Condominiums are found in many locations throughout the country and come in various price ranges, which means finding one to suit your personal needs and financial capacity should be a walk in the park.
One thing you need to keep in mind is that foreigners can’t own more than 49% of all sellable units in any given building or compound.
If you’re looking to buy a used condo from a Thai citizen, make sure to check with the property management office. They’ll let you know if the building already has too many foreign owners.
2. Securing a leasehold
What about owning a beautiful Thai villa or a big property? In this case, your only option is to lease. You can apply for long-term land leases and build structures on the land. This essentially allows you to own a villa, townhouse, or any property really, on Thai soil without actually holding the land deeds in your name. So, you have the joy of living in your dream Thai home with a slight catch – the land it sits on isn’t technically yours.
Your lease can last up to 30 years and can be renewed twice, pushing your leasehold period to a maximum of 90 years. However, remember that renewing the lease isn’t always a walk in the park. The owner, or their heirs, can turn down your request for an extension.
To avoid stepping into this potential pitfall, it’s important to jot down every single detail and agreement when you sign the leasehold contract. This can save you from future trouble and brick walls of miscommunication.
3. Setting Up a Thai Company
Company Ownership: Foreigners can set up a Thai limited company in which they own up to 49% of the shares, and the remaining 51% must be owned by Thai nationals. The company can then purchase land under the company’s name. However, this option should be approached with caution, as the company must be a legitimate business and not created solely for land ownership.
4. Joint Ventures with Thai Partners
Land Ownership through Joint Ventures: Some foreigners enter joint ventures with Thai citizens or entities, where the land is purchased in the Thai partner's name, but the foreigner may control the land and its development through the terms of the joint venture agreement. This arrangement requires careful legal structuring and should be done with the assistance of a qualified lawyer.
5. Ownership through a Thai Spouse
Spouse Ownership: If a foreigner is married to a Thai citizen, the Thai spouse can legally own land. However, the foreigner should ensure the property is legally protected, as the land would still be in the spouse's name, and there may be risks if the relationship changes.
6. Real Estate Investment Trusts (REITs)
REITs: Foreigners can also invest in Real Estate Investment Trusts (REITs), which allow them to gain exposure to the Thai property market without directly owning land. REITs pool money from multiple investors to invest in property, providing returns through rental income and capital gains.
7.Become a permanent residentIf you’re thinking of staying in Thailand for good, it might be a good idea to become a permanent resident. Becoming a permanent resident can offer more choices. Not only can you live indefinitely in Thailand without the need for stay extension applications, but you can also have your name on a house registration document. Furthermore, as a permanent resident, you have the ability to purchase a condominium without making any bank transfers from overseas. This status also enhances the likelihood of getting approved for mortgage financing.
8. Getting married to a Thai national Another option on the table is marrying a Thai national. However, even if you tie the knot, owning land won’t just fall into your lap. Your Thai partner will need to prove that the money used to purchase the land was entirely theirs.In effect, the purchased property would be registered under the Thai spouse’s name, even if you (as the foreign partner) were the one to buy it. You’re prohibited from jointly owning the property with your spouse, so it can’t become a shared marital asset. The Land Department also requires a signed declaration from the couple stating that the money used to buy the property was solely owned by the Thai spouse. Moreover, after marrying a non-Thai citizen, a Thai national faces limitations regarding future land acquisitions.
Conclusion
While foreign ownership of land in Thailand is restricted, there are several legal and practical alternatives such as leasehold agreements, forming a Thai company, joint ventures, or investing through REITs. It's highly advisable to consult with a legal expert or real estate lawyer to navigate these options properly and ensure compliance with Thai property laws.
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