Am I allowed to buy/own property in Thailand? What is Freehold? What is Leasehold? Thai Company Ownership…?
General Property Ownership Explained Foreign nationals who purchase real estate in Thailand can hold property through a variety of ownership structures.
The three most common forms of ownership used by foreigners to hold real estate are leasehold, freehold through a condo title, and freehold through acquisition by a Thai company.
Freehold means that a property can be owned outright in your name forever. Individual units in a condominium building may be owned freehold by foreign nationals.
Leasehold means that the building or land is held on a lease from the land or building owner. The longest registered lease permitted by Thai law is 30 years, which will be registered at the Land Department. It is common to contractually agree options to renew the lease for additional extensions beyond the initial 30-year period.
A Thai Company is an indirect means of foreign ownership, typically for land and villas, but commonly for condominiums as well. There are strict rules in setting up and/or maintaining a Thai Company when foreign nationals are involved.
Which structure primarily depends on the ‘type’ of property (condominium or house/villa) you are interested in purchasing.
Our legal team can help assist you and guide you in the right direction to ensure that buying and owning property here in Phuket, Thailand reflects a process that offers total clarity and utmost confidence. Our professional expertise within the property sector is second to none.
Legal checks and due diligence
Is it common to conduct a legal due diligence on a property before transferring? What legal services are provided? What to look for.
It is common practice for property buyers to consult the professional expertise and services of local lawyers to conduct due diligence checks on the property title and/or developer to ensure they have the legal right to sell.
Typical legal services may include:
· Initial investigation of title to ensure there are no outstanding charges and encumbrances
· Preparation or review of a reservation agreement or sales and purchase contract
· Assistance for buyers in opening a Thai bank account
· Advice and assistance in ensuring compliance with the condominium act (if applicable)
· Assistance in obtaining the FET (foreign exchange transaction form) from the buyer’s bank required at land office to register the transfer of ownership.
· Calculation of the applicable taxes, duty & transfer fees.
· Representation at Land Office for completion of title transfer
· Providing any Power of Attorney necessary for the transaction
Due Diligence Services
· Bankruptcy Search (on Developer)
· Investigation of land zoning and building permit
· Examination of the Condominium Juristic Person (company or individual owners)
· Vetting of the rules of the condominium
· Vetting of the condominium accounts
· Enquiry as to the proposed future expenditure
· Vetting of the insurance policy
· Site inspection where required
· Reviewing IEE and IEA filling process and approval (where applicable)
· Check construction/developer plans fit with EIA approval (where applicable)
· Background check if any outstanding legal proceedings or mortgages for the land, property or actual developer
Please note: Buyers are not required to be in Thailand for the legal transfer of property at completion. A power of attorney will allow a lawyer or representative to conduct on your behalf. Any funds used for purchasing a property can be sent your legal representative, who will ensure all legal documentations, FET (foreign exchange transaction forms), invoices and receipts and payments are made to the seller and the title deeds and ownership documents are returned to you
