How can foreigners buy a property in Thailand?

YES! But there are a few rules that you have to know! 

Thailand offers unique opportunities for foreign investors, particularly in its vibrant real estate market. However, there are specific legal frameworks that foreign individuals and entities must navigate. If you’re considering purchasing property in Thailand, here are the key rules you need to be aware of.

Condominium Ownership: The 49% Rule

Foreigners are allowed to own condominium units in Thailand, but ownership is capped at 49% of the total units in any condominium project. For example, in a building with 100 units, no more than 49 units can be foreign-owned. This limitation is based on the total floor area of the building under the Thailand Condominium Act, Section 19.

Key Requirements for Foreign Condo Ownership:

• Foreigners must bring foreign currency into Thailand to cover the full purchase price and exchange it into Thai baht.
• The bank handling the exchange provides documentation, which must be submitted to the Land Department.
• Foreign ownership is a personal right and cannot be transferred to another foreigner unless they also qualify under Section 19.

If the foreign ownership cap is reached, foreigners can still lease units in the same project under standard leasing laws.

House and Land Ownership

In Thailand, foreigners are prohibited from owning land under the Land Code Act. However, foreigners can own a house separate from the land it stands on. This requires following a precise legal process and registering the ownership at the Land Department.

Foreigners can lease land for up to 30 years under a long-term lease, but this leasehold arrangement is a personal contract, not a real property right. Lease agreements must be registered, and lease rights cannot be inherited unless specified and approved by the owner. Additionally, the lease cannot be used as collateral for mortgages.

Leasing Highlights:

• Leases are considered prepaid tenancy contracts and are subject to renewal.
• Leases for residential purposes don’t require foreign currency transfers.
• The leaseholder’s rights are limited to the terms agreed upon in the lease contract.

Exceptions for Land Ownership

While foreign land ownership is typically prohibited, there are a few exceptions:

• Under Section 96 bis of the Land Code Act, a foreigner can own up to 1,600 square meters (1 rai) for residential purposes by investing 40 million Baht in assets that benefit the Thai economy. However, these approvals are rare and the ownership is not transferable or inheritable.
• Special privileges may be granted for foreign businesses investing in Thailand under certain laws, such as the Investment Promotion Act.

Inheritance Laws

Foreigners who inherit land as legal heirs can request ownership under limited circumstances. For example, a foreigner married to a Thai national may inherit land but must sell it within one year, as they cannot register land ownership themselves.

Final Thoughts

Understanding the complexities of foreign ownership and lease laws in Thailand is essential for anyone looking to invest in real estate. Whether purchasing a condo or leasing a property, following the correct legal processes ensures that your investment is secure.

For more information, reach out to our team at Twins Estate Asia!