Under Thai law, foreigners are not allowed in owning land in Thailand. There are two options for foreign investors: a 30-year leasehold or purchase the property by setting up a limited company. Apartments, on the other hand, can be purchased by foreigners as long as 51% of the building is owned by locals. Due to Thailand’s legal restrictions in the property market, foreigners tend to search for alternative ways to make a direct property purchase in Thailand.
Owning land in Thailand
Foreigners can lease land in Thailand for 30 years. This occurs when a foreign man marries a Thai woman; the Thai woman purchases the land and imposes the lease agreement with the foreign husband. Make sure that all the data on the deed is accurate, and that the property you are leasing has the proper title. Land titles can vary in Thailand, relying on different factors such as location and whether it can be leased to a foreigner or not. Among the seven types of land titles, only three can be leased namely: Chanot, Nor Sor Saam Gor and Nor Sor Saam.
Another way for foreigners to purchase land in Thailand is by setting up a Thai Limited Company. If you choose this option, you must well be aware that foreigners are not allowed to own more than 49% of the company shares. The Thai Immigration Office is well aware of this type of procedures and will surely monitor your business closely.
When you are satisfied with a certain property in Thailand, you will be asked to make a deposit to show good faith in finishing the process. The seller, in return, will reserve the property so you can start the process by preparing the contracts for the purchase. Since the seller will be writing the contract, it is highly recommended to have a property lawyer in Thailand review its terms and conditions. A proper resolution should be stated in the contract concerning the protection of your interests in case there are any delays in the construction of the property. The contract should include a clause stating the penalty for late payments, which should be reasonable to both parties involved. Normally, a first payment is 25%, followed by another 25% when the roof is on, another 25% when the doors and windows are placed and a final 25% when the fixtures are completed.