Can You Buy Property In Thailand ?

Buying a House: At the height of the currency crisis in 1997, Thailand agreed with the IMF to liberalise 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 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 leashold agreement on the property. We will also require the lender and the borrower to write out a seperate 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.

There are other ways for foreigners to buy and own property, and our lawyers work with our clients to ensure each purchase is covered legally, according to the circumstances.

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, motorbike, 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.

Foreigners can not borrow money from banks in Thailand to buy property, unless they have a Thai partner willing to act as guarantor. There are numerous other conditions too, so if you wish to go this route, make sure you have a totally reliable Thai partner, and you have plenty of demonstratable income (either here in Thailand, or from overseas). Nor can you mortgage a property to obtain a loan.

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. Our lawyers can help set up all the correct legal procedures and paperwork needed for this type of purchase.

A good time to buy?

Clients point out to me the amount of building going on around Pattaya as indicative that the economy in Thailand is improving, and now is a good time to "invest" in property in Thailand .

While there are plenty of properties standing vacant, and a number of failed developments, these are being revived now that the economy is recovering. We can expect to see many 'failed' developments taking on a new lease of life from now on.

I am reliably informed that there are many more sellers than buyers, which the 'Mail Market' pages of the Pattaya Mail would tend to confirm, week after week.

So where's the money coming from for these building projects? Much of it is coming from overseas investors. The rest is coming from savvy Thais who can see the potential. Personally, I see the real estate market growing steadily over the next five years -- perhaps as long as 10 years -- before it slows down again. When the economy crashed in 1997, almost all housing and condominium building stopped. To put it simply, the market became so overheated that property values were inflated way past their true value. Couple that with unrestricted lending by greedy banks and it was no wonder Thailand suffered such a crisis, bringing down banks, and destroying 'on-paper' fortunes overnight. New accommodation building only re-started again in 2003. This will continue until the amount of housing is sufficient for the market. We are a long way from that target yet.