Phuket belongs to the top holiday destination in Asia. This Thai island attracts tourists all over the world promoting it as an international hub in the region. This rise in tourism and strong reputation of Phuket brings a growing number of investment opportunities. Expatriates from Europe, Canada, Russia, America, so as the affluent families from Asia come to the island not just for holidays, but now to secure investment in Phuket property. Investors seek to buy commercial real estate and convert it to resort. Some others prefer to acquire residential properties in the form of condominiums, apartments, houses or villas either for primary residence on retirement years, rental income or simply an investment.
There is one thing all prospective buyers of property in Phuket must remember: there is restriction on a foreign ownership of phuket thailand real estate. Generally, expats are allowed to own the structure (the building) but not the land where the building stands.
As a foreigner, there are many ways to secure an investment in property in Phuket. Depending on the specific needs and circumstances of the individual buyer, one method or another may be the most suitable for any individual case.
Buying a Condo
Condominium units in Phuket may be lawfully owned and registered into the name of a foreign national. As per Condominium Act B.E. 2522 (1979) as amended 2008, a foreigner can buy a condo in Phuket up to 49% of the total number of condo units.
Buying a Villa/House or Buying Land
A foreigner cannot own a house in his name. A foreigner can only own the structure, example the building or the structure of the house or the villa, but not the land itself.
Owning land in Phuket is restricted to foreigners. However there are number of ways available for foreigners to buy land in Phuket:
1. Freehold ownership of land through a Thai Limited Company
If you are a foreigner, one way of owning land in Phuket would be through setting up a Thai Limited Company and purchase a piece of land which will be under the name of Thai Limited Company. In this setup, though the majority of company shares are Thai-owned, the foreign owner can have both control of the company and freehold ownership over the land by being appointed as the Director.
2. Leasehold on Property
Another way of owning the land in Phuket would be by securing a 30-year registered leasehold. A foreigner can get a long term lease on a Phuket Property (maximum duration of 30 years) with an option to renew the lease indefinitely. Renewal of the lease is not enforceable in a court based on a promise made in a lease signed 30 years ago.
There are limitations for this option. Should the Thai property be sold to a Thai buyer, lease renewals cannot be registered and would be useless. In addition, the lessee is not allowed to sublet, sell or transfer his interest without the consent of the lessor.
3. By marriage to a Thai national
The foreigner will give the purchase money to be used for buying of land to his Thai wife. Thais may lawfully hold title to land in their own names.
The foreigner can own a property in Thailand through marriage to a Thai national, and by adhering to following conditions: that the land must be registered under the name of the Thai spouse; that the foreign spouse must sign a document that the land was bought with funds owned by the Thai spouse, therefore the foreigner is waiving his right of ownership over the land.
There is a restriction on foreign ownership towards real property. But this doesn’t limit the foreign investors to acquire Phuket property. There are different possible methods and vehicles of property ownership. It is a best practice that before buying any property, make sure you do the title search, due diligence, and contract review.