How a foreigner can buy real estate in Thailand
Yes indeed, foreigners can certainly invest in the Thai property market
In my last blog I discussed how now is possibly one of the most opportune times to buy real estate in Bangkok in recent history. With the opening up of the ASEAN economies as the AEC due in 2015 and the ongoing and relatively enthusiastic expansion of both the MRT and BTS train systems around Bangkok, these two factors combined should lead to not only a boom in the Bangkok economy, but also an increase in property prices in Bangkok and also in other areas of Thailand.
However to take advantage of this, expats have to buy into the Thai real estate market. Therefore this blog reviews how foreigners have been investing in real estate in Bangkok - and many expat teachers have already started.
After posting the previous blog I had a few expats new to Thailand asking me how they can go about purchasing real estate in Thailand, so in order to answer those questions and to cover potential questions from other readers, I thought it best to write a blog devoted to the topic.
Buying a condominium in Thailand as a foreigner is the easiest and most straightforward method to invest in real estate. Due to the 1979 Thailand Condominium Act, foreigners can own condominiums anywhere in Thailand 100% outright, as long as the building has not already sold its 49% foreign quota. Each condominium in Thailand when registering with the land department designates 49% of its units for sale for potential purchase by a non-Thai buyer.
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This way at least 51% of the building always remains in the hands of local Thai people, however individual units that make up the other 49% can be sold to foreigners outright. Therefore it is legal for a non-Thai, non-resident foreigner to own 100% of a freehold condominium in Thailand. And in fact 17% of condominiums owned in Bangkok are owned by foreign investors.
There are of course stipulations and these mainly concern finance. Thai banks in general will not want to lend to foreigners. In fact even foreigners with a history in Thailand i.e. employment history, work permits and marriage certificates can struggle to get financing from a Thai bank in order to purchase property, however it is not impossible and with perseverance some foreigners do succeed. If however you do not have history of the above then it would be more practical to borrow from a bank in your own country with which you have a record.
Whichever way you obtain financing, and whether it be for a townhouse, detached house or condo, if it is going to be in a foreigner's name the money needs to be brought in from overseas. Even if a mortgage can be obtained from a Thai bank, they will bring the money in from overseas and end up lending the money in a foreign currency such as US Dollars or Singapore Dollars. For more details on purchasing a condo in Thailand please read this info.
Some expat teachers however have already got married, settled down and started a small family, and often therefore require something larger than a condominium. By possibly sacrificing the communal swimming pool and other facilities such as a fitness area - often found in mid to high level condominiums in Thailand occupied by expats - some expat teachers opt to buy townhouses or detached houses. Of course these provide the buyer with often not only two or more levels, but more rooms and space. And in some cases the chance to have a garden or yard, suitable for young children and/or a pet. However this comes at a price.
Unlike condominiums, which of course are covered by the Thailand Condominium Act of 1979, townhouses and detached houses are ‘landed', they essentially contain an area of Thai land underneath them or around them. As it is not possible for foreigners to own Thai land, then an expat wishing to buy a townhouse or detached house has two options. And split across teachers I know that have bought a townhouse or detached house in Thailand, both options are appealing given individual circumstances.
The first option I will cover quickly and briefly as it is not really relevant to this article, but realistically it would be inappropriate not to mention it. This option is often taken up when the expat or foreign investor knows that he has a stable and solid relationship with their spouse or partner that they can trust. And therefore the property is bought 100% in the Thai person's name and of course this also opens up the options for finance from a Thai bank.
Option 2 however is the method chosen by foreign investors that feel they do not have the above luxury. They are open to start a company in Thailand in which they can own 49% of the shares. This may sound unappealing, but with the other shares split over 7 or more locals and more than often none of them having any voting rights or knowledge of each other, most foreign investors realize that the company is controlled by them. This means that the property purchased can be placed under the umbrella of the company and therefore controlled by the foreign director.
As unusual as a lot of the above sounds to the first time reader, and as ‘fishy' some of the details come across on the initial read, the systems do in fact work and the savvy expat or foreign investor can and regularly does successfully buy and sell real estate in Thailand. Foreigners have been buying real estate in Thailand regularly for the last three decades and more and more invest in Thai real estate each year. This would not be possible if foreigners were being consistently ‘cheated' out of their money by the laws of the land.
For more information on investing in real estate in Thailand please feel free to contact me by e-mail, or read the following blog covering many of the topics mentioned above in more detail
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I guess that would be a Usufruct. The big problem with it is that the usufract ends with the life of the holder. You cant leave it to your kids. another problem is that it depends on the Land Office Official as to whether he will allow it to be registered if he thinks it is designed to bypass the foreign ownership laws.
This is what Thai law says -
By Shina, Bangkok (1 month ago)
Is it possible to purchase a property in a development where the land is own by a real state company and you own the home itself? Simular to townhouse communities in the US where you own the house, but the land is own by a company and you pay HOA fees for the upkeep of the land.
Hi BBWe, I'm an agent base in Bangkok with HQ in Hong Kong.
To answer your question, the monthly rental will directly deposit into your thai acc(if you have one), and if you don't have one we can always assist to set it up.
There is no limitation to transfer to money out however you would have to make sure that you have a FETC when you purchase.
You can also transfer the titled deed to your child, there a inheritance tax of 10% but for property value over THB 100 million(majority propertied wouldn't hit that amount)
By Catherine, Bangkok (4 months ago)
Hi, I am planning to invest a resident property in Bangkok, can the agent transfer the monthly rental fee easily back to HK? If I sell the property in one day, is there any limitation to transfer the fund back to HK? or is it possible to transfer my property to my child?
By BBWe, Hong Kong (8 months ago)
I am interested in buying a small hotel in Phuket area with my own money after forming a company /Can I buy it legall ?
By RPS Kohli , India (8 months ago)
There is a retired foreigner from Natherland, who is currently interested in my property (a house) in Thailand. Is he allow to own the property for relocation purposes? If not, what are the other options available for him?
Thank you in advance
By Mint, Samutprakarn, Thailand (9 months ago)
All very good points and you seam to be talking from a place of personal experience.
Perhaps in my case much -much further investigation is required as I haven't done my due-diligence and I'm a very cautious investor in all things I do simply as I cant afford any loses due simply due to my own ignorance.
Due -Diligence to the extreme necessary in Thailand I feel!
By George S, Sydney Australia (11 months ago)
The simple truth is that a Non Thai citizen can not own land in Thailand. Yes you can set up a company to try to get around the law but when you do it is not legal.
It is a simple principle of law in any country in the world that a system that is set up in order to circumvent a law is by definition illegal. So setting up a company to try to own land is NOT LEGAL. Certainly many have done this and many have had no problem but that does not mean that it is legal. It simply means that they were lucky. When one of these arrangements is tested in court the foreigner will lose because it was simply a construct designed to skirt the intention of the law.
Do you want to take the risk?
The other side of this coin is that it is now illegal in Thailand to set up a company so that the majority shareholders are only nominees with out any controlling power. A minority share holder is and always will be a minority.
Do you want to test this in court?
By Shina, Bangkok (11 months ago)
Also some good points , "who is a reputable solicitor/Lawyer" in Thailand?
That I don't know as I haven't transacted any business there yet but will next year 2017, I hope?
Can you trust a local Thai law firm? . don't know?
Can you trust an expat law firm. again don't know?
But I will have my BS detector on full power when doing so !
Real-estate agents the world over I have found come in two categories the first I tell before we start "Don't F&%$# be about! " and the second "Stop F%$#@ me about! , I don't know what it is with agents but I guess when you have a bet each way you loose all your credibility!
I guess its a matter of acknowledging you are going to be gouged and having a limit you feel is an acceptable gouge , sorry to say but its beginning to sound like a simple realisation of doing business in Thailand!
Although my inherent DNA wont accept anything but 100% fair and open negotiations I am prepared to see what amount of BS and shenanigans I can bear if I think the deal is still acceptable .
Time will tell and I will post details of solicitors/Lawyers I find who I consider fair and working in my best interest as they should when I'm paying them.
And as far as Kick-backs , Rebates , Referrals or whatever people wish to call them , It has become the norm in most Industries today accept it or not I'm sure it happens more than we care to believe.
Good luck to all transacting a real-estate deal in Thailand in the future!
By George, Sydney Australia (1 year ago)
To all you would be property tycoons , STOP!
Would you buy a property in your own country without first seeking proper and qualified legal advise ?
I guess yes it appears !
"Get your self a lawyer son , better make sure his a good one!" Spend a few $$$ and get the right advice.
I too have a thai GF and travel back and forth a few times a year and want to buy but sure as hell I'm not blowing my hard earned money on some shonky deal when a lawyer/solicitor is a few hundred baht for the right advice!
By George, Sydney Australia (1 year ago)
Laods of bullshit!
You can write as much as you want, Thailand WILL loose out more, and more, and more.
Because we don't suck up, we tell the truth!
As unusual as a lot of the above sounds to the first time reader, and as ‘fishy' some of the details come across on the initial read, the systems do in fact work and the savvy expat or foreign investor can and regularly does successfully buy and sell real estate in Thailand. Foreigners have been buying real estate in Thailand regularly for the last three decades and more and more invest in Thai real estate each year. This would not be possible if foreigners were being consistently ‘cheated' out of their money by the laws of the land.
Don't belive a wo d you read in this article. Many of the expat land purchase agreements are illegal under current Thai law and you will find out that you never owned the land you "purchased" when you try to sell or die and your wife, husband, partner are shocked when they discover they don't own the land.
Does anyone know MIDA Property development? We are considering to buy an appartment/condo in a new development taking 2.5 year to complete and would like to know more about their reputation.
By Willem, Rotterdam (1 year ago)
i have recently found out if you are married to a thai then you can obtain a management document 50 baht from the council office to manage the land untill you die
By brian david, thailand (1 year ago)
Nice to stumble across this piece!! For all you foreigners with the big bucks I suggest you think twice and do not be too trusting when it comes to buying properties. You are safe if it's a room in a condominium but outside that use your initiative and better judgement. Events unfolding in Phuket shoud be enough lesson for anyone.
By Posterboy, Bangkok, Thailand (2 years ago)
Seriously I foreigner can buy property in Thailand. Well if it’s true than today only I am going to buy a property there. I have not heard yet if any country over globe will allow foreigner to buy property at its place. Thank you so much for this useful post.
By Jason Statham, Thailand (2 years ago)
Dear Ajarn Athiraj,
My German friend who is in Germany wants to buy a second hand town home (price 2.6 m thb), he and his family will relocate in Bangkok. Is it allowed him to own a property by his name, not the owner of the home who wants to sell the house to him? If so how? If not so how it would be so both sides would have equal advantage. I dont know if my friend have cash to buy or he's going to ask for a loan with a bank in Thailand.
By Chanapa, Bangkok (2 years ago)
Hi, I'm looking to move to Thailand and would love to invest my money into an accomodation business of some sort (hotel, hostel or guest house). What are the best ways to do this as I do not have nor plan on getting a Thai wife ( happily married to Aussie lady)?
Great pointers. Now im learning some percentage that is allowed by a foreigner.
By john lee, United States (2 years ago)
i am looking at buying a new home in krabi from a private seller or owner of the property i would like to put the house in my name i know i cannot own the land just lease it for that period of time .is it possible to buy the house in my name .thankyou
By Ross Dorling, krabi (3 years ago)
Yes u can buy condo unit by cash. But u have to show evidence to transfer money to Thailand acc. And on the trasfer registration date, basically, we use cheque to pay for the condo unit price due to bring a lot of cash is too risks.
Can I buy a condominium in Bangkok by cash ? I also have an international bank account (such as HSBC or Citibank). Can I do the transation via bank transfer in Thailand?
My friends and I are interested in buying a condo in Bangkok. I have a couple American friends and I am Thai. We all have a full time job but we cannot purchase with cash. Is it possible to put 20-25% down payment and look for a bank to give us a loan (Condo is > 5M)? Please advise.
By Kate Suwannahong, United States (3 years ago)
I'm an American looking to buy land and build a house in Buriram. Can anyone please advise me on this works?
By Mike A, Work in SW Asia, but travel to Buriram often (3 years ago)
Hi . How can I transfer my condo to my son name . Please advise . Thank you .
By Eric, Singapore (3 years ago)
Hi all, I am a corporate legal practice lawyer including the transaction in relation to properties in Thailand.
I would give you a preliminary advice as set out below:
By Athiraj, Bangkok (3 years ago)
Hi, I'm thinking to buy a land to run motel in Bangkok . But I'm not sure about the laws of Thailand. Is it possible for me to buy land in Thailand.
I need some advice.. my husband died and left a property in thailand in which he owned 49 % .. there are 2 heirs myself and a daughter. . We both live in the uk and dont know the protocol for this and to be honest we thought he owned the whole house but have just found out he only owned 49 % . a thai lawyer told me I must go to thailand and stake my claim in a thai court.. is this correct
By vicki kerr, uk (4 years ago)
Hi, I’m looking at buying a piece of land to build a house on, on an island in Thailand. If I set up a company & the value of the property goes up over say 10 years, and I decide to sell, do the other 51% shareholders benefit from the increase? Do I have to share half my gains with them? And is there tax to pay on the gains even if I’m just living on the land?
Upon sale there is a tax to pay at the land office. Its a group of tax's which all equal about five percent. One of them is reduced the longer you have owned the property. You can also lease land or buy it in a nationals name and use a superficies or a usufruct.
By Mark, Thailand (4 years ago)
This situation where Thais want their land to be owned by Thais reminds me of my home country. I remember 20 years ago when my country got free from russian occupation and all the land and businesses were sold to foreigners. Everybody was very angry that foreigners own our land. But i must say today Estonia is one of the most developed countries of the area with many rich estonians. I would gladly invest here (have my eye on this hotel http://phuketpropertyshop.com/property/a-great-business-opportunity/ ) but there is just too much shady business.
Hi what would happen to one of these foreign owned apartments in the advent of the building being knocked down / redeveloped etc?
Hi, I'm looking at buying a piece of land to build a house on, on an island in Thailand. If I set up a company & the value of the property goes up over say 10 years, and I decide to sell, do the other 51% shareholders benefit from the increase? Do I have to share half my gains with them? And is there tax to pay on the gains even if I'm just living on the land?
By Chris, London/ Koh Payam (4 years ago)
Kieran, in response to your question, the unfortunate answer is yes! The Thai authorities need to see money transferred in already ear-marked for a certain property if you are buying it in a foreigners name. Therefore if the money is already here you need to transfer it out and back in.
As someone working here, lets say I have a million thai baht in my bank a/c, what would I have to do to buy a condominium, do I have to transfer it out of the country and in again and suffer multiple fees exchanges to comply with the rules?
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