Thailand Ownership Options

BUYING A PROPERTY IN THAILAND

Having chosen your desired property, the next step a smart buyer will take is to choose a lawyer to guide you expertly through the relevant Thai legal procedures. A little background information on legal avenues open to you can go a long way to help you choose the best path available.

AM I ALLOWED TO BUY LAND/PROPERTY?

This is usually the first question asked by foreigners. Although Thai law prohibits foreigners from owning land in Thailand, structures have developed to enable foreigners to effectively own land, and still comply with existing Thai laws. Mainly these are through the following three procedures:

1. Company Set-Up
Your lawyer will, if appropriate, advise you upon the incorporation of a Thai Limited Company. Buying land/property in a Company name is currently the most popular choice among foreigners who wish to acquire an interest in land in Thailand. The recent enforcement of existing regulations by Government Departments relating to Thai nominee shareholdings (which are forbidden) has led to a change in the Company set-up by law firms in Thailand to comply with the law. Your lawyer can discuss the practicalities with you. The forms can be signed in person in Koh Samui, or they can be couriered to you back home. Once the Law Office receives all documents, it will take about 2-3 weeks to form the Company. All companies must file audited accounts yearly.

2. Leasehold
The taking of a leasehold interest is becoming increasingly popular. A registered lease is relatively uncomplicated and easy for your lawyer to set up. It can be held in your own name (no company required). Foreigners are permitted to lease land in Thailand for a maximum of 30 years with an option to renew for a further two periods of 30 years each. A lease registered with the Land Office remains in force throughout the term of the lease, regardless of whether the freehold owner sells or otherwise transfers the freehold. However, even though the owner may agree to a renewal clause in the lease agreement, it is uncertain at present whether this right can be enforced against a purchaser/successor of the freehold interest.

3. Condominiums (Condos)
Foreigners can own forty nine percent (49%) of the aggregate unit space of a condo development. A condo 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 condos in Thailand under certain circumstances.

SUMMARY

You are strongly recommended to seek the advice of a lawyer when considering the purchase of property in Koh Samui, just as you would do back home. Whilst the system may be alien to you, most law firms in Koh Samui offer an excellent service and you can be confident that they will look after your interests.