As previously mentioned, as a foreigner in Thailand, you are not allowed to own land as freehold. But there are many alternatives for how to buy land from which you can make your choice.
- Long-term Leasehold This is a popular way of owning land in Thailand amongst most expats because it is simple, straightforward and hassle-free if you take the correct channels with the assistance of knowledgeable real estate agents and lawyers. Long-term leasing is the most popular legal method for an expatriate to obtain land for the following reasons;
- Your land and the rights to use it can safely be acquired and registered for a maximum lease term of 30-years at the Thai Land Department. (Renewable)
- Your lands lease can warrant for some flexibility such as including the option of reassigning the lease to someone else if you sell OR the option of subleasing to someone else.
- You can include your family members as co-signers in the contract as insurance so that if anything might happen to you, someone in the family like adult children can continue the lease to its full term.
- Even though there is no automatic right to renewal of your 30-year lease, having the right legal and real estate teams from the very beginning will guarantee you the best assurance of renewal in the clauses of the paperwork. Renewal is possible two more times giving a total of 90 years.
- With a registration fee of only 1.1% of the rental value – a leasehold is usually an extremely low-priced option for you to be able to own land in Thailand
- The long-term leasehold is flexible in that if your situation changes and you marry a Thai national, you can always include in your agreement the option to convert to freehold and have the house in your Thai spouses or Thai childs name.
- A fact that many people do not know is that even though you cannot own land in Thailand you can still own the house or villa that is built on the land. So you can obtain a construction permit in your own name once the land owner has issued you a long-term lease. This gives you some security because the land owner cannot take ownership of the property when the lease expires the house will still belong to you under Civil Law.
- By Marriage If you are married to a Thai national, the two of you can purchase the land together after going through the legal paperwork that is required for that kind of purchase.
- Thai Limited Company Another common way of purchasing land is by setting up a Thai Limited company which will then hold the rights to the freehold land. As a foreigner you can own 49% of the companys shares and you must have Thai national shareholders with the remaining shares (most lawyers can arrange this). As common as this method is it is best for those know that they have a trusted group of Thai shareholders that they know will sign over their voting rights and relinquish control of their shares to you. Otherwise as the majority, they will have voting control of the company and its assets (the land).
If you decide to buy a house under a corporate entity (company), this will mean that you have to align to Corporate Tax which is higher than personal tax. Also, what you put down to set up the company has to be counted as your initial investment.
Something to remember when you make your choice in Thailand, land is measured by Rai not by acres or square metres so make sure you make the conversion first before making your decision on the price you are willing to pay.
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