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Property Legal Issues

Thailand - Property Legal Issues


It is not legal for foreigners to own land within Thailand. You are able to purchase a house, but the land that it sits on will not be yours. It is, however, legal for non-Thais to own a condo or apartment, providing the total foreign ownership within that particular complex is no more than 49%. These can only be sold to foreigners if the owner of the complex or the developer has applied for permission to sell units to expats. When purchasing a property it is wise to have independent legal advice as it has been known for some developers to be devious about this and some foreign owners do not legally own the property that they are living in as a result.

If you purchase a house you need to have a lease on the land, and the maximum term that can be arranged is 30 years, although it has been known for 2 x 30 year leases to be arranged to run consecutively, although this is also officially against the regulations.

Those who are married to a Thai person choose to purchase the property in their name, but that means that the expat cannot have their name on the property as it is not possible to have joint ownership. However, this is a much more reliable option than purchasing through a company as there are too many pitfalls. As long as you trust the named owner of the land then you should have few issues. However, this would be a personal arrangement and there will be little legal redress if the agreement should unravel at a later date.

It is possible to purchase land through a company. However, it is not a fool proof system as an expat is not permitted to be a majority shareholder in a company, so if purchasing a property they will own at most 49%. Shares in companies can be held by nominees and this can help to get around the current system, but this is a complicated procedure and should be carried out by a legal professional. This is often done within the law firm itself, so strictly speaking 51% of your home will be owned by staff within a legal firm. This could cause problems if there is an investigation as you would not be able to prove that they are legal shareholders of the company as none of the company capital could be traced to their own banks. The company could then be declared illegal and closed down.

There are many more complications when buying through a Thai company so unless you are fully aware of the system it is recommended that you do not go down this route. There are no requirements to keep the property for a certain amount of time before you sell. There is currently no requirement for a property purchaser to have a visa in order to purchase property and there are many foreigners who purchase condos but only use them for a few weeks holiday each year, renting them out for the rest of the time.

By following the correct procedures a lawyer should ensure that there are no outstanding debts on a property before you purchase it so that you are not responsible for them. Debts are usually in the name of a person rather than on a property apart from a secured loan and this should be resolved at the same time as the property is sold.

As expat property owners are not able to own land there are not normally any issues with planning permission and boundaries. Boundaries are usually very clear on property deeds and if planning permission is required then it should be applied for at the local planning office. Land should not be purchased in the hope that planning permission will be granted at a later date as there are no guarantees within the Thai system.

There are very few properties with preservation orders in Thailand on property so this should not be an issue that expats will come across. There is no difference in the rules for purchasing an urban property than there are for urban properties in Thailand. As the system for purchasing has many possible pitfalls it is recommended to only enter into a property purchase with good legal assistance.


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