Can You Buy Property In Thailand?

The short answer to this is: A foreigner may legally purchase, together with his Thai wife, a house, land or property not exceeding 1 Rai which is duly purchased as marital property-that is, the Parties are legally married and documented at the local Amphur (government office).

The purchase must be jointly held and cannot be sold without the other partner's signature, nor can either force the other out of residence without due compensation. The foreigner's name will never be on the actual Title Deed, but a Memorandum is attached to it indicating his legal attachment to the owner.

Buying a House with a Thai Partner: At the height of the currency crisis in 1997, Thailand agreed with the IMF to liberalize its laws with regard to foreigners owning real estate in Thailand.

The matter was debated in parliament and the press at great length, and the usual jingoistic (some would say xenophobic) statements were aired that if the protectionist laws were amended, we greedy farangs (foreigners) would sweep in and buy up all the land in Thailand and exploit the poor innocent Thais in our typical colonialist fashion. (I wonder why the fact that Thais or anyone else with money can buy any amount of landed property in the UK or USA is never aired as a counter-argument, and neither the British nor Americans seem terribly worried that their country is going to be taken over by colonising Asians-but that perhaps is another topic for another day.)

If you are single, gay, or don't have a Thai spouse or partner, it is slightly more difficult to buy a house, but our lawyers are past masters at overcoming the difficulties and setting up a legal instrument that allows foreigners to buy and legally control ownership of the property.

The easiest way to do this is through a loan/lease agreement. To put it simply, you lend the money to a Thai under a legal loan contract which will specify that the money must be used to purchase a property. The loan will be 'on call', giving the lender the power to recall the loan at any time. Your Thai partner will buy the property using the money from the loan and then legally 'own' the land. At the same time, our lawyer will set up a Lease agreement giving the lender a 30, 60, or 90 year leasehold agreement on the property. We will also require the lender and the borrower to write out a separate Last Will and Testament which will deed the property to the surviving member. If the survivor is you, the foreigner, you may legally own the property for up to 12 months after your partner's demise. Then you must sell it to a Thai to recover your original investment plus any profit you make on the sale.

Buying a House with a Thai Company: It is possible for a Thai company to buy and own property, and this is how many foreign buyers overcome the restrictions on land ownership. Our lawyers work with our clients to set up the company so that they, in effect, have complete control over it.

Basically, it works like this. The foreigner sets up a Thai company holding 49% of the shares, with 7 Thais holding the other 51% shares. Our lawyer will find 6 Thais willing to own one share in the company (usually other lawyers in his office), and the foreigner can nominate one other Thai to hold the rest of the shares. If the foreigner doesn't know anyone we at Holt Realty can help select someone trustworthy and honest.

The Thais will 'borrow' the money from the foreigner to buy their shares, and they will sign over their control of the shares to the foreigner to secure the loan. This way, the foreigner controls the voting on all the shares. The foreigner can and should be the Managing Director of the company.

This is a simplification of the method, but our lawyer will explain exactly how it works.

A Word of Advice: No matter how much you love and trust your Thai wife or partner, it is better to use the above methods to buy land so that you always retain control over your investment. The papers are full of tales of woe from foreigners who have bought a house, car, motor bike, TV, and so on, only to have their partner claim full ownership and leave the foreigner with nothing. When it comes to your money, it makes as much sense to protect it here as it would back home....more sense in fact because once you relinquish control of your money here you have no legal recourse to reclaim it. With over 25 years experience living in Thailand, believe me, this is excellent advice. Ignore at your peril!!!

Buying a Condominium: Foreigners can own freehold a condominium in any legally registered condominium building, provided the total tenancy of foreigners is no more than 49%. If you really want to buy a unit in a condo that already has the maximum number of foreigners allowed to own in the building, you can still buy if you open a Thai company (ownership 49% foreign/51% Thai). Of course, then you are faced with all the attendant obligations owning a company entails; income, expenses, taxes, management, etc.

To buy a condominium, a foreigner must bring in 100% of the purchase price from overseas. You will need a Tor Tor Sarm (T.T.3) document to present to the Land Department. Our lawyer will accompany you to the bank when the money arrives to help you get the T.T.3.

Financing Your Purchase: Until late 2005, it was impossible for foreigners to borrow money to buy property, or to mortgage existing property in Thailand. This has changed as some foreign financial institutions are moving into Thailand and working with the Thai banks to offer foreiners loans. They require a minimum 30% deposit on a house purchase in many cases, but this is flexible and depends on your financial situation, your credit rating, your job and and many other factors.

In addition, if you own property overseas, these lenders will consider giving you a mortgage on that property to buy property in Thailand.

A registered Thai company can buy property and apply for loans. If you own a percentage (up to 49%) of the company, you could qualify for a loan.

If you are married to a Thai and they have a salary that will enable them to repay a loan, you may want to consider letting your Thai partner apply for a loan instead and you can act as guarantor. There are many options open to you today. How does this work? Contact your real estate agent for more information.

Transfer Fees: In most cases, the seller will pay the transfer fees, business and stamp taxes. However, since the cost of these went up on January 1, 2004, some owners are now asking purchasers to share the costs, or to pay them all, in return for not increasing the cost of the property.

Foreigners may also own a condominium with a leasehold agreement. In this case, the property remains in the Thai owner's name, but you sign a 30, 60, or 90 year leasehold agreement, with all the legal obligations and benefits that this offers, including the right to buy, sell, trade and Will the lease to heirs. You should hire a qualified real estate lawyer to help you set up all the correct legal procedures and paperwork needed for this type of purchase.

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