Buying a house in Thailand
Buying a house in Thailand is
one of the most contraversial topics out there. The simple fact of the
matter is that, while it is legal for a foreigner to purchase an
apartment in Thailand, it is illegal for a foreigner to own land, and
therefore a house. The rules are pretty clear on this issue and
recently there has been some moves towards the tightening of the
regulations even more.
Having said that there are many
foreigners who own landed property in Thailand and there are various
ways this can be done. The most common way is for the foreigner to put
the land in the name of the Thai wife and then have legal ownership of
the building on the land. This can be a precarious situation and can
lead to various legal complications in the case of divorce, death or
other situation. The legal paperwork needs to be very thorough and
cover all eventualities.
The other main way property can be
owned in Thailand is through a Thai company. The basic idea is that the
foreigner sets up a legitimate Thai company, which has a seperate legal
identity in Thailand (like companies the world over). This legal
identity (the company) can own land, property, have a bank account and
so on. However, there is an added complication here in that in Thailand
foreigners are only allowed to own 49% shares of the Thai company. So
that the foreigner can control the company though, the foreigners
shares are set up when the company is formed so that they have more
voting rights than the remaining 51% of shares in the company. This
allows the foreigner to retain complete control of the company and thus
any land and property owned by that company.
This latter area
falls under the control of the Foreign Business Act. It's the FBA that
is currently being reviewed with the idea of potentially closing this
loophole. As yet it is not known whether this will happen or not. If it
does it could seriously affect the real estate market in Thailand.