Buying Land in Thailand

Purchasing Property and Real Estate in Thailand

Oct 3, 2009 John Howe

Many new expatriates to Thailand ask is; "Is it possible to buy land and build a house?" The short answer to that question is a resounding 'No,' but all is not lost.

Thailand is an enticing country with a tremendous climate, safe swimming in clean, warm seas fringed with long beaches, and large areas of pristine jungles. To add to the allure of the country the people are charming, polite and considerate. No wonder so many foreigners have the dream of settling permanently in Thailand.

Thai law prevents non-Thais from the outright purchase of land and property, the only exception to this is the purchase of condominiums but restrictions apply. There are numerous pitfalls to foreigners buying land in Thailand. Expats are only able to own a maximum of 49% of the property or land on which the house stands.

However, there are ways in which a non-Thai can acquire land and a house but it is worthwhile to keep in mind the caveat ‘buyer beware.’ Both the two main ways in which foreigners buy land or a house are not without risks and will entail a considerable outlay of funds even before the purchase or building has been completed.

Ways to Own Land in Thailand

However, there are ways to “own” land in Thailand; the first is to buy the land in the name of a Thai national usually a friend, a spouse or someone implicitly trustworthy. Of course it is possible for a Thai spouse to purchase land in his or her own name, however proof has to be provided that the purchase money came from within Thailand and not transferred from a foreign country. Alongside this there has to be sufficient evidence that the spouse can afford to make such a large purchase.

Leasing Land in Thailand

Choosing to lease an already built house or land for building also has its problems as Thai leases are short. The maximum lease is 30 years but it is possible to extend for another 30 years after the lease has expired this must be explicitly written into the lease document. Even then terms and conditions may need to be renegotiated with the Thai land owner. The lease agreement should include a clause determining the owner of the property in the unlikely event of Thai law being changed to allow foreigners to buy land and houses.

The lease agreement must then be registered at the local district office or Amphur. The terms of the lease can specify anything that is agreeable to both parties. For instance, it is wise to specify in the lease what happens if either the lessee or the real owner dies. Provisions should be made in the event of the foreigner wanting to sell the house or property for instance a clause allowing a sublet. If there is a spouse and children and should the lesser die during the term of the lease a clause, allowing the survivors to remain in the property is also essential and should be included in any agreement.

Buying a House in Thailand

When buying a house or property and in all cases it is wise for the foreigner/expat to physically hold the title deed as borrowing against the property or using the land as collateral may be very difficult.

Buying a Condominiums

Buying condominiums (condo) in Thailand is easier than buying or building a house. Purchasers should consider a number of things when buying a condo.

The first is never buy a condominium that has not been completed; many Thai construction companies go bust without completing the building. Check the developer’s financial status as many go bankrupt before the building is completed. Returning the deposit in these instances may be impossible. If there is any doubt about the financial (or otherwise) stability of the developers walk away and find another.

Whichever way land (or a condominium) is bought; either through a Thai nominee, spouse or by establishing a Thai company, always use a reputable Thai or Thai-based foreign law firm to provide guidance through the cats-cradle that are Thai property laws. Failing to do so may cost considerable sums of money or complete loss of an investment.

The copyright of the article Buying Land in Thailand in Retirement Planning is owned by John Howe. Permission to republish Buying Land in Thailand in print or online must be granted by the author in writing.

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