Property Ownership for Foreign Buyers

When purchasing an apartment, villa, or land in Thailand, a foreign buyer can generally choose between two forms of property ownership: Freehold and Leasehold.

Freehold means full and permanent ownership of a condominium unit. The property is registered directly in the foreign buyer’s name. Under Thai law, foreign ownership in a condominium project is limited to 49% of the total saleable area.
Freehold applies to the condominium unit itself and does not include ownership of the land on which the building stands.
For villas, the ownership structure is different. The land may be held through a Thai company, with the buyer appointed as an executive director. The structure may also include voting shares and a letter of indemnity from the Thai partner.

Freehold: Main Benefits and Drawbacks
Freehold is often chosen by buyers who plan to personally use and keep the property for their own needs.
Advantages:

• The owner has full rights over the property and can sell, gift, or pass it on as an inheritance.
• There is no need to renew the ownership period.

Disadvantages:

• Freehold properties are generally 8–10% more expensive.
• When a property is resold within the first 5 years of ownership, the registration tax is 5%. After more than 5 years, the registration tax is 3%.
• Currently, property-related tax in Thailand is charged at the registration stage. However, a separate property ownership tax could potentially be introduced in the future, including for Freehold properties.

Leasehold is a long-term right to use and possess a property. Under this structure, the developer or legal owner grants the buyer the right to use the property for an initial period of 30 years. The agreement can normally be extended, with the total term reaching up to 90 years.
The contract may also include provisions allowing the Leasehold rights to be transferred when the property is sold to another buyer.

Leasehold: Main Benefits and Drawbacks
Leasehold is particularly common among property investors.
Advantages:

• For Russian buyers, Leasehold is generally treated as a rental arrangement, meaning the property does not need to be declared as owned property.
• Lease extensions require a 1% tax payment for each additional period, with one period equal to ⅓ of the apartment's value.
• Leasehold properties are generally priced around 8–10% below comparable Freehold units.

Disadvantage:

• When selling the property, the transfer needs to be coordinated with the legal owner.

How Property Registration Works
Both Freehold and Leasehold transactions are registered with the relevant local authorities and recorded with the Thai Land Department. Depending on the ownership structure, the buyer is registered as either a permanent or temporary holder of the property rights.
In both cases, the owner receives the relevant official documentation, including the Chanote Title and House Book.

For additional information, please contact us using the details below:
By phone / WhatsApp: +66821077912
By email: sales@phuket9.com