Thailand: condos, the only property open to foreigners

Thai law reserves land ownership for nationals. A foreigner therefore cannot acquire land, whatever their residence permit or length of stay.

They can, however, buy a condominium unit freehold, within a quota set for each building: the share held by foreigners may not exceed a fraction of the total floor area of the units.

This rule explains why the market for foreigners is focused on residential towers in Bangkok, Phuket and Pattaya: it is the only segment open to them.

A house with land can therefore only be obtained through a long-term lease, whose remaining term determines its value, or through a Thai spouse — which raises other issues in the event of separation or inheritance.

The funds used for the purchase must also come from abroad and be converted into baht on arrival, with bank evidence required when the transfer of ownership is registered.

This rule is not unique to Thailand: it is found, in similar forms, in the Philippines and Indonesia. It reflects a view of land as national heritage rather than a tradable asset, which most European buyers approach with ill-suited reflexes.

Two structures are in circulation. The first is to have the land acquired by a Thai company in which the foreigner holds a minority stake, with nominee local shareholders.

The second is to have the property acquired in the name of a Thai spouse or third party, with the foreigner providing the financing.

Both are unlawful. Thai law penalises the use of nominees, and the foreigner then loses the property with no effective recourse, even when they financed all of it.

This is the most serious risk in Thai property projects, and it is systematically played down by intermediaries, who present these structures as established practice rather than as an offence.

A Thai property investment should therefore be structured exclusively through freehold condominium ownership, or through a proper lease whose term and renewal conditions are reviewed with an adviser independent of the seller.

The first point is the condominium's foreign quota. A condominium whose quota has been reached can no longer sell to a foreigner, which narrows the pool of buyers on resale.

The second is the quality of management and the level of service charges. The stock aimed at foreigners includes older developments whose maintenance has been neglected and whose charges have crept up.

The third is the title itself: it must state foreign ownership and be registered at the competent land office, with the evidence of the foreign currency transfer.

We publish neither the percentage of the foreign quota, nor Thai transfer duties, nor the taxation of rental income: they do not appear in the official sources we have been able to verify.

Finally, short-term holiday letting is regulated, and operating it without authorisation exposes the owner to penalties. Any yield presented on that basis must be checked against local regulations.

Thai tax residency is acquired above 180 days¹ of presence per year, a lower threshold than in most states.

The scale ranges from 0%² to 35%³, and Thai-source dividends are subject to a withholding tax of 10%⁴.

A non-resident owner also remains taxable in France on their Thai rental income, with the tax treaty determining how double taxation is eliminated.

The impossibility of owning land is therefore, paradoxically, the most structuring point of a Thai project: it limits what you can acquire, and therefore what you can pass on.