There are three ways in which a foreigner can control title to residential property in Thailand: outright purchase of a condominium unit,
voting control in a Thai company which owns the property, or through a lease.

Foreign ownership of condominiums

The law governing foreign ownership of condominium units is straight-forward; foreigners may own up to 49% of the total area of all condominium units in a condominium project. In effect, this means that foreigners can fully-own property in condominium buildings with the same rights to title that Thai owners have.
Foreign ownership of land

Currently, foreigners may own up to one rai (1,600 square meters) of land for residential use, provided the foreigner brings in not less than 40 million Baht (1.3 million US Dollars) from abroad to invest in specified businesses in Thailand and obtains permission from the Ministry of the Interior. Foreign land ownership exemptions are also granted for businesses having Board of Investment promotion privileges.

It is possible for a company with non-Thai shareholders to own land, and landed property, provided that not more than 49% of the shares in the company are owned by foreigners and a numerical majority of the shareholders are Thai persons or companies.

It is illegal for a foreigner to establish a company using Thai nominees with the sole purpose of circumventing Thai law to purchase property. It is not illegal for a Thai company to have a Thai majority shareholding and foreign majority voting rights.

It is still possible to buy a property which is already in a company set up but the registration of a new company to purchase the land is extremely difficult and any application is highly scrutinized in regard of the shareholders and their personal financial investment into the company.

Alternatives to land ownership for foreigners

The Thai Civil & Commercial Code allows forms of possessory rights such as lease and, unlike the Land Code, the CCC does not distinguish between foreigners and Thai nationals. A lease allows land and buildings to be used for a maximum term of 30 years and remains in full force with respect to the property, even if there is a change in ownership of the land. Using a Protected Lease the parties can contractually agree to renewals of 30 + 30 years meaning a total lease period of 90 years.

Properly structured, leases are fully transferable and can protect the rights of heirs and allow an option to purchase if a change in the law allows it, or if the buyer’s personal circumstances change – for example if he/she marries a Thai national.
Property transfer taxes and fees

With the exception of the Transfer Fee which is usually shared between the buyer and the seller (1% each), payment of all taxes and fees involved in the sale of a property in Thailand are the responsibility of the seller.

The Transfer Fee is calculated upon the valuation of the property as held by the Land Office and updated from time to time. The Land Office’s appraisal is nearly always less than the market valuation.

If a property is held by a company, or for less than 5 years by an individual, a Specific Business Tax is levied at a rate of 3.3% of the declared selling price. If owned by an individual for more than 5 years a Stamp Duty rate of 0.5% is applied.

Withholding Tax at the rate of 1% of the Land Office’s appraised value of the property is also applied.