Hem utomlands

Buying a home in Thailand

Dark tropical nights, friendly people, wonderful beaches, tasty spicey food and an even summer climate all year round...  Thailand has become popular amongst the Swedes who in a steady stream are finding their way to this southeast Asian country.  Alongside Spain, Thailand is the only country today where housing for Scandinavian senior citizens is being built.


Restrictions pertaining to foreign ownership in Thailand depends on the type of property which a foreigner wants to acquire.  Below are the top real-estate investments in Thailand and its ownership restrictions:

1.  LAND
Foreigners are generally not allowed to own land in Thailand.  But there are alternatives through which a foreigner can own land.
a.   Through a Thai Limited Company - A foreigner can set up a Thai Limited company and buy land in the name of that company.
b.   Investment (BOI) - A foreigner, who invests 40 million Baht for no less than 5 years, is entitled to buy up one rai (1,600 square meters) of land for residential purposes.  Permission from the MInistry of Interior must be obtained.
c.   By marriage to a Thai - A foreigner with a Thai spouse can purchase land in Thailand but the land should be registered under a name of the Thai spouse.  The foreign spouse also has to sign a declaration stating that the funds come from a Thai spouse, so that he/she waives his/her right to the ownership of the land.
d.   Lease - A foreigner may acquire land in Thailand through leasing for the maximum duration of 30 years, with a possibility to renew again (for another 30 years) if agreed.  This is the least complicated option for a foreigner to have a right of usage of land.  Land leases over 3 years must be registered at the Land Department.
e.   Structure Ownership - A company or the Thai spouse of a foreigner may grant a Right of Superficies in favor of the foreigner, giving him the right to personally own all constructions situated on the land.  The Right of Superficies can be conceded for a period of 30 years and can be renewed for another 30 years (but not automatically).

2.   CONDOMINIUM

A foreigner or foreign company can acquire up to, but not exceeding 49 percent of the total space of a condominium project.  The money used to fund the purchase of the condominium must come from abroad and should be deposited in a Thai bank account if the foreigner is not a resident in Thailand.  This is called a Foreign Exchange Transaction form or FET.  Upon registration, the foreign buyer will obtain a title deed for the unit.

Condominium units can be owned through freehold and leasehold.  Condominium units may be leased to foreign nationals without restriction but will still need to show that money has come from abroad.

3.   HOUSE AND VILLA

Foreigners can only own a house and villa in Thailand through a Thai Limited Company or under lease agreement.  Foreigners may own the structure or building but not the land.

Leases

Foreigners may acquire a lease freely in Thailand for any property including condominiums or land.  Leases can only be registered for a maximum period of 30 years at a time but renewal clauses can be included in contracts allowing for further extension of another 30 year period.  It may be possible to include another extension of 30 years if required.

Transfer and Registration of Ownership Fees

Transfer fee                           2% (currently 0.01%) of the appraised value of the property   

Stamp duty                             0.5% of appraised value.  Only payable if exempt from Specific Business Tax

Withholding tax                    1% of appraised value of the property or the market value whichever is higher

Specific Business tax    3.3% (currently 0.1%) of the appraised value of the property or market value whichever is higher if  selling within 5 years

Lease                                      1.1% registration fee of the total appraised rental amount or actual amount whichever is higher

Financing

Bangkok Bank and UOB in Singapore grant loan to help you finance your property purchase in Thailand.  It is possible to borrow up to 70% of the total purchase price of the property; however, the normal rate is around 60%.  The loan should also not exceed a period of 10 years.

Property tax

Building and Land Tax is charged on a property which is used for any commercial purposes.  This means a house, building or structure that is not a place of residence.  Leased properties are automatically subject to this tax.  The rate is 12.5% calculated on actual or assesed annual rental value of the property.

Local Development Tax is charged by the local administrative body based on the appraised value of the property on a varied rate.  Normally, such taxes are quite nominal.

Please note!  This information should only be seen as general guidance.  Since laws, taxes and fees often change, a buyer must always inform himself of the latest rules and regulations.