Thai Real Estate Law
What kinds of real estate foreigners can buy under Thailand’s real estate laws?
- Foreigners can buy and own condominiums in Thailand.
- Foreigners can buy and own buildings and structures, such as a villa, a hotel, a shopping mall on the island at a distance from the mainland.
- Foreigners cannot buy and own a piece of land directly, but they can use the land for long-term interest under a lease contract. The Thai government applies a new law to attract foreigners who are looking for residential properties for living or investment in Thailand. According to the new law, the land lease contract for foreigners is changed from a maximum of 30 years to 50 years and can be re-registered for additional 40 years (90 years in total).
Transfer Fees and Property Taxes
Thailand has no annual property tax, but the buyer has to pay a 2% transfer fee and a stamp duty of 0.5% for the freehold property. Regarding the 2% transfer fee, the buyer will pay all, or pay a 1% fee and ask the seller to pay the 1% fee (50% each), depending on the seller-buyer agreement.
As for the leasehold property, the buyer has to pay a registration fee of 1% and a stamp duty of 0.1%. taxes and the fee is payable at the land office for the valid registration and transfer. The registration fee can be paid by the seller and buyer at 50% each, or the buyer pays all, depending on the agreement.
According to Thai law relating to condominium business, if the condominium is registered as your house certificate of Thailand, selling it after 1-year living requires no 3.3% business tax. In case it is not registered as your house certificate, selling it after 5 years requires no 3.3% business tax. During the first 5-year years, you can get rental income.
Succession of Property in Thailand
When the real estate owner passes away, the property will be given to the person as shown in the will ( the intention of the owner ). In the circumstance that the deceased person failed to establish a valid last will and testament before his/her death, the heir is legitimately entitled to receive the property according to the laws of Thailand where the property is located. Typically, the heirs are children, parents, siblings, or other close relatives of the decedent. Spouses are not legally considered to be heirs, as they are entitled to own properties via marital status.
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