Property Ownership in Thailand

In Thailand there are basically two types of Property ownerships. One is Individual property ownership and second is corporate property ownership.

Individual Property Ownership in Thailand
Normally, foreigners may not possess property in Thailand. There are a few exceptions to this law, which are related to condominiums and BOI (Board of Investment) promotions to permit corporate housing in selected areas, dependent on observance with investment terms of the BOI promotion and condominium ownership. There is time and again talk of a few changes in the law which will let foreigners to possess land; it is improbable that this will take place anytime in the near future. The patriotic approach to land possession is so engrained in the law and the Thai culture that is doubtful to overturn. That being said, one former Minister of the Interior said, “I don’t appreciate all this excitement about foreigners possessing Thai land, it is not as if they will take carry the land with them when they leave!”

Lately in 2003 with the beginning of the Elite Card, foreigners who meet the criteria for this card may buy land in some of the specific areas in the country for their own use. The price of an Elite Card is Baht 1 million.

Corporate Ownership of Property
Thai corporate structures are quite comparable to western corporate structures. Thai law gives permission to PLC’s, LLC’s, Limited Partnerships, Ordinary Partnerships, and a range of other types of corporate bodies. Once these are created, they are referred to, in Thai legal terminology, as Juristic Persons.

Juristic Persons in Thailand, which are possessed by a Thai majority, are regarded as in terms of property ownership, to be a Thai person and as a result, may possess property in Thailand. Note that equitable ownership, which Thai law addresses, does not inevitably associate to actual control of the Juristic Person. The most admired form of corporate land ownership is the Limited Liability Company (LLC).

Possession of Land by Foreigners in Thailand is Restricted

Possession of land by foreigners is strictly restricted in the Kingdom of Thailand. That being said, it is not impracticable for a foreigner to attain interest in real estate in Thailand. Foreigners are permitted to buy apartments although should abide by strict rules and fall within some specific conditions. In recent times, Thailand has passed legislation that would let foreigners to buy condominiums. Also through the deliberate use of corporate law, forming corporations to hold title to land is another alternative used by foreigners to hold land titles.

LAND
Under the Land Code of Thailand, a foreigner may possess a land only by desirable quality of a provision of an agreement permitting the person to obtain immovable property. Prior to 1970, Thailand had completed 16 such agreements with countries together with, the U.S.A., England, Germany, France, and Japan. Though, since 1971, foreigners or popular foreign-owned companies have not been capable of possessing land or buildings with land in Thailand.

Though, the Thai Land Code has been afterward modified to let foreigners to buy land for residential purposes since January 19, 2002. The land bought for residential purposes under the modification cannot exceed one rai (just about 1600 sq. meters). The following set of laws and conditions must also be met:

1. Transferring funds more than Baht 40 million to Thailand for investment and maintaining such investment for more than 5 years;

2. You have to get authorization from the Minister of the Ministry of the Interior;

3. The land to be purchased must be positioned in Bangkok Metropolis, Pattaya City, or Tessaban (Municipality), or in the area mentioned as residential zone as per the law of Town and Country Planning and must not be in a military safety zone as per the law of Military Safety Zones;

4. If a foreigner, who is granted authorization to purchase such land, does not make use of the land for residential purposes within 2 years from the date the registration for land attainment is made, the Director General shall have the power to dispose of such land.

Seamico Chief Chaipatr Goes For Investment in Land

Though Seamico Chief Chaipatr Srivisarvacha makes available lots of prospects for consumers to invest in different types of assets, does not have sufficient time to take care of his own finances.

"I'm somewhat a conservative person. I must have given additional time to my own individual finance. But until now, I've given preference to something else," the CEO of Seamico Securities, says.

As a managerial of a securities firm, Chaipatr cannot invest in stocks for the reason that it would infringe the regulation on the subject of conflict of interest. Therefore he invested in something else that would not disobey the regulation and need less consideration than investing in stocks. He invested in land.

"I invested in land just similar to my father. I think they are assets. The cost of land permits us to make long term investment. The cost increases quite high eventually if we stick to the perception of location, location, and location… Population globally increases along with time, and comparatively, the size of obtainable land gets smaller along with time," he said.

One and a half year ago, he invested in a plot of land in Khao Yai in Nakhon Ratchasima at Bt300,000 per rai and lately somebody offered to pay money for this land at Bt1.2 million a rai.

Looking into the usual overall investment case of Asians, land would consist of a major proportion to the side from other assets, together with cash and stocks, he says.

"Land investment is not that conventional as it is dangerous at a definite level. Contrasting stocks, land is not liquid. Although you can utilize it to guarantee with banks for loans," he says.

Chaipatr said he invested in land, especially in land plots that are big in sufficient quantity to commercialize in Bangkok, the provinces, and overseas. One should think about purchasing Bangkok apartments rather than renting them. Once one pays off the credit for apartments or condominiums, one turn out to be the owner and can sell with current rate.