The maximum lease term is typically 30 years, with the possibility of extensions for another 30 years. The neighborhood land office must be notified of each lease renewal. Under certain conditions, a foreign corporation may lease land for industrial use for up to 50 years with the option of an additional 50-year lease.
Given that a building is leased, less authority over it exists than with a freehold title. Even while a 30 year lease can typically be extended twice consecutively for a total of 90 years, there is still a chance that it won’t be owing to changes in the legislation or the conditions.
There is a chance that the landowner will decline to sign the lease extension registration after 30 years. The lessee has the option to file a lawsuit for breach of contract, which will result in a costly and drawn-out legal process. It also implies probable legal action by the landowner for breach of the lease, difficulty obtaining a mortgage for the lease, and a decreased selling value.
Foreigners are only permitted to own up to 49% of the company’s shares, unless they are Americans. This means that you require Thai shareholders who will formally grant you ownership of their shares. Since there must be a minimum of three shareholders, you may have one foreigner and two Thai shareholders. Even though you own these shares, you must still follow the correct legal processes to safeguard your investment.
Additionally, you must ensure that the business maintains regulatory compliance. You must make sure that balance statements are submitted annually and that the company’s address is maintained since inactive companies that are not producing income risk being delisted.
To learn more, consult the law.
Three sorts of land title deeds are used to classify them:
- Chanote (Nor Sor 4 Jor)
- The Nor Sor 3 Gor
- Nor Sor 3
The most popular and well-known kind, the chanote, gives the possessor full ownership rights to the land. which you are allowed to subdivide, sell, transfer, assign, use, and hold. Typically, Chanote titles must be used for all condominium construction. If you want to buy land in Thailand, this title document is the one to have because the land’s measurements are so precise.
When a land is awaiting a full title deed, a Nor Sor 3 Gor title document is issued. The Land Department measures the property and establishes the precise borders so that the owner is aware of the exact area that he possesses. It is possible to sell, give away, mortgage, or divide this kind of land. The landowner may also petition the Land Department to convert the deed to a full title deed (Chanote), and the Land Department may comply if no objections are raised.
District land officers issue Nor Sor 3; the Land Department has not yet measured it. Lack of precise borders can make it difficult to divide your land from adjoining land in the future and determine its exact location. The right to just possess the land is established by this title deed, but real possession is not transferred. Property cannot be sold or transferred by the owner without first being advertised for at least 30 days. The Nor Sor 3 title, however, might eventually be changed to a Nor Sor 3 Gor or Chanote.
Other land titles are also available, but they are not advised because they do not give the owner numerous rights to the land under Thai law.
This is the least complicated, shortest, and least expensive way to buy real estate in Thailand. Additionally, this choice needs less accountability.
The main advantage of a freehold property purchase over a leasehold one is that the owner has the freedom to sell or lease the property and to develop it in accordance with Thai law. Freehold purchases can be a little slower and more expensive than leasehold ones.
In contrast to land leasing, such land is permanently owned by the firm for the duration of that existence. If you already had plans to open a business in Thailand, using this strategy is equally practical. This approach is particularly appropriate if you want to buy land as an investment because it allows you to mortgage the property or divide it up for sales, which is typically not available with a leasehold.
No registration is required for leases under three years. 3 year or longer leases must be filed with the Land Department.
Foreign nationals are prohibited from purchasing freehold land in Thailand by law. With the aid of legal assistance, individuals can properly secure property, govern that, and own land. A Thai limited business with freehold land ownership cannot have more than 49% of its shares owned by foreigners. They might, however, own a structure separate from its land, such as a condominium unit.
The dimensions of land in Thailand differ slightly from those in Europe, the United Kingdom, or the United States. The area or size of the land is frequently displayed in local measuring units, most frequently Wah, Talang Wah, or Rai.
Using a leasehold agreement or forming a Thai limited liability company are the safest and easiest ways to own land.