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Buying a real estate property from a foreigner's perspective

Foreigners can't own the land outright in Thailand, but they can legally own the house in their own name and lease the land for periods of up to 30 years. Foreigners are allowed to own condominium apartments registered under the Thailand Condominium Act freehold in their own name.

A building under Thai law can be a separate immovable property (separate from the land it stands on), and the most common real estate sale and purchase structures for foreigners is a long term land lease or contract for hire in combination with a contract for sale for the house, or in case of a housing development, instead of a land lease agreement combined with a sale agreement for the house, a construction contract could be offered. For tax reasons some developers choose a construction agreement above a sale agreement for the house. The effect for the purchaser is the same as long as the building permit is issued in the foreign purchaser's name.

Transfer procedure for a building
A house in Thailand does not have any form of ownership title document (condos have) but the house is an immovable property (it can be transferred separate from the land). As an immovable property Thai law requires that the transfer must take place at the competent authority (the land office) to be complete. The transfer is effected through the official land office sale procedure at the land office where the property is located. Legal assistance to assure correct transfer and registration of the house and payment of taxes and transfer fees by the parties is recommended. Try us! The transfer procedure takes approx 40 days to complete (including a 30 day announcement of the sale of the house). The official land office sale agreement (separate from any private sale and purchase agreement between the parties) will be a form of ownership document, which again must be submitted as proof of ownership whenever selling the house in the future.

A house does have a house registration book or Tabien Baan, however this is not a ownership document but a registration document from the local municipality.
Transfer taxes for a house are calculated based on the actual sale price or appraised value by the land department. The appraised value will depend on the size of the house, number of floors and materials used.

Contract for hire (lease) registration
Any contract for hire of real estate in Thailand exceeding 3 years must be registered on the land title deed  (the land must  therefore have a proper title deed) at the local land office where the land is located to be enforceable over 3 years. The lease agreement between the parties must have a Thai script version. It is not sufficient when a standard land office lease agreement is registered. A private comprehensive lease agreement drafted by a professional is essential. See our template contracts for different types of lease agreements and more information. Registration fees are charged at 1,1 % over the total lease amount as stated in the contract for hire (or if this is too low it will be assessed by the land department).

Undeveloped 'raw' land
The other method is to lease undeveloped (raw) land and build the house yourself. In this case the building permit must be issued in the foreigner’s name, as under Thai law the building permit will function as a form of ownership document for the house and in case of a future sale this must again be shown as supporting evidence in the sale procedure at the land office.

In case of undeveloped land the preferred structure is a 30-year land lease agreement with all options combined with a right of superficies. The right of superficies is also registered on the title deed in addition to the registered land lease and separates ownership over the land and house.  The right of superficies is for many an unknown property right, but it's an important additional right in any long term lease construction combined with ownership over the house. In case of an existing building the registration of a right of superficies is generally not accepted by the land offices in Thailand (in our opinion there is no legal objection for registration of a superficies in case of an existing building).
It must be noted that even though the building is owned by the foreigner, his right to own his building upon land owned by someone else only last as long as his right to use the land last.The most important aspect of any house acquisition in Thailand is succession of the rights to the land and possible renewal of these rights upon expiration. Upon expiration of the land lease and superficies the renewal of these rights must be agreed. Both the land lease and superficies agreement anticipate on this situation.
Prior to Land Department regulations instructing land office how to deal with partly foreign owned companies (several regulations from May 2006) it was common practice for foreigners to purchase real estate through Thai holding companies. Currently this is less common due to strict regulations at the land offices aimed at preventing misuse of nominee structured companies  by foreigners for property purchase.

Due diligence
Part of any leasehold or freehold purchase of immovable property in Thailand, and responsibility of the purchaser, is an investigation into the property with a certain standard of care prior to the acquisition and prior to any deposit. A due diligence investigation by a professional varies for different types of properties and specific requirements of the buyer, but usually includes a standardized process based on a checklist. 

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  • Buying Thai real estate
  • Buying a condominium

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