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Buying Land in Thailand
There are a number of options that are available for a foreigner wanting to
acquire property. House in Chiang Mai have facilitated each of these options for
different foreigners in the past and our legal advisors are well versed in the
procedures and can plan and implement a scheme to suit your circumstances.
Land leases
This option has become much more popular, so most foreigners
who “own” land and houses go for a leasehold agreement of typically 30 years,
with two prepaid 30-year renewals. The lease will include clauses that
automatically allow freehold ownership if the laws of foreign ownership change
in the future, and the right to sell and/or transfer the property.
This gives you 90 years with strong backup, making it
effectively ownership.
Just to complicate things a little, while you can only lease
land, all the buildings – either on the land when it was purchased, or improved
or built by you after purchasing the land, are yours freehold. Technically this
means that once the lease expires, the owner of the land must purchase the
building(s) at an independently and legally valued price, or negotiate another
lease period.
The structure of a lease agreement needs to be watertight. But
because this has become the preferred way of holding land in Thailand for
foreigners, this type of lease agreement has become more or less a template,
with add-ons to suit individual buyer’s needs.
But don’t draw it up yourself. Get the advice of a lawyer
versed in such things. And don’t sign anything or hand over any money until you
fully understand and are happy with what’s written on the lease agreement.
Thai partner
If you are married with a Thai, then the most simple solution
is to let her buy House and Land.
For the partner to buy land, proof is required that the money
used to purchase the land is legally the Thai partner’s, with no foreign claim
to it. Get divorced or separated and the Thai “ex” gets to keep it all.
Should the Thai partner pass away, then the foreigner can inherit the land under certain circumstances, and he will have to sell (or form a new construction of somekind) within one year. This is the ONLY case in wich a foreigner can own land legally in Thailand.
Company owns the Land
Although foreigners cannot own land, legally formed companies
with foreign shareholders can do so. Company law is complicated here (isn't it
everywhere?), but in general a Thai company cannot have more than 49% of its
shares owned by foreigners, and if the company is going to own property then
this reduces to 39%. If the company has been set up by a competent lawyer then
you can still have control of the company despite the fact that you will own
less than 50% of the shares.
The Thai authorities have now taken steps to close Companies
only for the purpose of acquiring property, any company with foreign
shareholders that tries to register the purchase of land is now subject to a
full investigation to ensure that the company has not been set up to enable
foreigners to acquire land. So tread carefully if you intend forming a company
purely as a vehicle to own property.
If you have any question regarding buying a House then please
let us know, and we will do our best to answer your question
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