BUYING PROPERTY IN THAILAND

How To Buy Property In Thailand

Lease - limited recommendation.

Foreigners can lease land on a 30 year contract which contains a clause giving the lessee first option on a further 30 years. The same contract, registered at the Land Office (Department of Lands), can be renewed every 30 years for a maximum of 990 years.

The lessor's heirs are bound by law to honour the agreement, and the lessee can bequeath the lease to his/her heirs in a Last Will and Testament.

A potential weakness with this solution is, for example, that the lessor can conceivably claim that the lessee is mismanaging the land to the detriment of its value, and can sue to dissolve the agreement.

Of course, this point must be proven in court, but could be a serious headache for the lessee. Also, although leases may be offered by reputable and trustworthy land owners, conditions can change through the passage of years.

Contract of Credit - limited recommendation

Instead of purchase or lease, the payment for land can be registered as a loan to the seller, documented in a Contract of Credit, registered at the Land Office.

The value of the loan is set at the registered value of the land plus the actual building cost of any structures on the land.

The buyer's name appears on the Title Deed as creditor, which effectively prevents the registered owner (debtor) from selling the land before repaying the loan.

The weakness with this solution is that as property values rise, the value of the property will in the future be greater than the value of the loan, and the debtor could conveivably buy the land back at bargain price simply by repaying the loan.

» The 4 ways you can buy property in Thailand Part 2

» Buying a condo Thailand - How and Why.

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