THAI LAW - Property guide to Thailand
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| Thai law |
Thai law | A common question asked of me is about foreign ownership of property in the Kingdom of Thailand, how foreigners can get full ownership and what the best way to go about it is. The answers all vary depending on the situation of the prospective owner but I will try to give a general guide to those looking to invest in the Thai property market. First up are condominiums, buying a condo in Thailand enables you to have full ownership and your name as the owner. But there are some conditions; when buying the condo you will have to transfer the money used for purchase from overseas, also every condo is only allowed a limited number or foreign owners. This is dependent on the number of rooms but the ratio must not exceed forty nine percent foreign ownership and fifty one percent Thai ownership, please double check this statistic with the seller before purchase. If it does exceed the ratio limit you will have to form a company with which you will use to buy the condo. One more thing to look out for is outstanding fees whether it is electric, water or common property fees as the condo owners will not allow you to transfer the property into your name if they are not paid and you may be the one who has to fork up the extra charges.
If you are looking at a land and house or only the land, you will have to set up a company for ownership. We recommend a number of things you can do to protect yourself as a foreign purchaser; firstly after setting up the company you should put yourself as the sole managing director, so you have sole control. Secondly you have to set up the company with preference shares which you have the right to own forty nine percent, but with the number of votes set to ten per share. This will give you the majority whenever you need to vote on a company matter. Thirdly whichever nominee shareholder you put in place must sign the shares back to you, also the documentation should be kept in safe storage or even in your home country but away from the company. Number four always keep important documents in safe keeping, if say someone else has the original copy of the shareholders certificate they may use it for their own purposes. Make sure that the owner is the one holding on to all the right documentation.
Here are some alternatives such as agreeing to only purchasing a house which can be put in your name as it is classified as movable property. This is a growing trend in foreigners now and involves putting the land in a spouses name and then long leasing it from them, another option is to put the land under a company that they own. On the topic of leases the longest lease in Thailand is a lifelong lease on either the life of the leaser or leasee with the next longest being over a thirty year period. Before Thailand had rolling lease with three intervals of thirty years each but this is not the case anymore as under Thai law, this is now illegal.
We will always recommend anyone looking to purchase a property to contact a lawyer, don’t do it by yourself or believe some Thai person who says that it is easy. A lot of people are cheated in this business and have lost a lot of money as well as many a property, by protecting yourself you are ensuring you have the best possible chance to secure a new property safely and with no problems down the line. The lawyer fee for a service like this should consist of two things; the first a sales and purchase contract and secondly for when you have the property transferred to you and you receive the title deed in your hand, and only then would you have to pay.
THAI LAW - Property guide to Thailand
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