Buying a new-build property in Thailand opens the door to a tropical paradise, but before finalizing the deal, it's crucial to understand two key concepts that define your ownership rights: freehold and leasehold. Understanding these terms will help you make an informed choice and avoid potential misunderstandings in the future.
Freehold is the most comprehensive form of ownership, similar to that found in most Western countries. When purchasing a freehold property, you become the absolute owner of the land and the building on it. This means you can dispose of your property as you see fit: sell, rent, bequeath, make changes, etc. For foreign citizens in Thailand, freehold is available in two main forms:
Leasehold is a form of ownership where you obtain the right to use a property for a specified, pre-agreed term, usually 30 years or more. In Thailand, leasehold is often offered for landed properties, where freehold is not directly available to foreigners. With leasehold, you do not fully own the land, but rather have a long-term lease agreement. Key characteristics of a leasehold:
Choosing between Freehold and Leasehold:
Choosing between freehold and leasehold depends on your personal preferences, budget, and long-term plans.
Important: Regardless of the chosen form of ownership, it is always recommended to seek the assistance of an independent lawyer specializing in real estate in Thailand. They will help you understand the details of the contract, verify the legality of the property, and ensure your rights are fully protected.
For any questions, please call us or submit a request. Our specialist will contact you shortly.
Freehold is the most comprehensive form of ownership, similar to that found in most Western countries. When purchasing a freehold property, you become the absolute owner of the land and the building on it. This means you can dispose of your property as you see fit: sell, rent, bequeath, make changes, etc. For foreign citizens in Thailand, freehold is available in two main forms:
- Condominiums: Foreigners have the right to own up to 49% of the total area of a condominium building. This means you can become the sole owner of your chosen apartment and also have a share in the common ownership of the land and common areas.
- Landed properties: Direct ownership of a house and land is not possible for foreigners in Thailand. However, there are legal schemes to circumvent this restriction, such as creating a Thai company that formally owns the land, while you own the company.
Leasehold is a form of ownership where you obtain the right to use a property for a specified, pre-agreed term, usually 30 years or more. In Thailand, leasehold is often offered for landed properties, where freehold is not directly available to foreigners. With leasehold, you do not fully own the land, but rather have a long-term lease agreement. Key characteristics of a leasehold:
- Ownership period: The most common leasehold terms are 30 years, with the option to extend for an additional 30 years (sometimes longer). It is important to carefully review the terms of the extension and associated costs.
- Usage rights: During the leasehold term, you have full rights to use and enjoy the property, as if you owned it freehold. You can live in it, rent it out, and improve it.
- Ownership of a Building: In most cases, the building (house) is your property, even if the land is leasehold.
- Restrictions: After the leasehold expires, the property rights revert to the original landowner unless the agreement is renewed.
Choosing between Freehold and Leasehold:
Choosing between freehold and leasehold depends on your personal preferences, budget, and long-term plans.
- Freehold (in the case of a condominium) offers maximum security and ease of ownership, ideal for those seeking full ownership.
- Leasehold can be an attractive option for purchasing a villa or house on land where freehold is not available. It provides long-term rights to use the property at a price that may be lower than freehold.
Important: Regardless of the chosen form of ownership, it is always recommended to seek the assistance of an independent lawyer specializing in real estate in Thailand. They will help you understand the details of the contract, verify the legality of the property, and ensure your rights are fully protected.
For any questions, please call us or submit a request. Our specialist will contact you shortly.
