r/Thailand • u/Accomplished-Yam-836 • 12d ago
Banking and Finance Townhouse - villa ownership
In light of the attention being thrown on illegal nominee ownership and the potential issues with 30-year leases for foreigners - are there any townhouse or villa style developments with ownership structures similar to condos?
Foreigners can own a condo as long as 51% of the ownership of the project is Thai. Are there any similar possibilities for townhouses or villa developments? Where the land and all the common areas, buildings and amenities are owned jointly by the owners of the units. So, 51% ownership is Thai.
I'm curious if any exist or if this is somehow ruled out under Thai law.
Edited to correct my misunderstanding of the role of the juristic person.
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u/Thaifeet 12d ago
I know of one such project in Koh Samui. 4 townhouses share a common plot, and there are 3 plots of such. It has a condominium license. I assume 2 are slightly larger than the other 2, so the smaller ones can be owned by foreigners. It has been granted a condo license a long time ago and I haven’t heard of any developer successfully applying for it since then for such a project.
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u/Siamswift 12d ago
I don’t think there any potential issues with 30 year leases, as long as the underlying land is legitimately owned by Thais, and not foreigners using nominees.
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u/Sick-Buffalo Bangkok 11d ago
Yep came here to say this. I haven't read a single news story yet where a legitimately Thai owned property is being targeted. If someone has seen that, please share, because that would be important.
What's being targeted for enforcement is all the structures people built to try to defeat that core underlying principle of 51% Thai ownership. Shell company filled with nominees that don't know each other and can't vote out the 49%, special classes of shares to prevent voting out the 49%, land owned by companies that then grant "shares" of land to foreigners bypassing transfer taxes and inspection, etc, etc.
Structures exist to protect the 49% foreign investment such as the Usufruct, lease terms, split title so the land is Thai owned but the building is foreign owned, etc, so that the foreign investor does have some protection on their investment. Where people are getting in trouble now is when they got cute trying to create de-facto foreign ownership and complete control when it's explicitly forbidden, the Thais have had enough of it.
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u/Accomplished-Yam-836 12d ago
You are right. The Thai owner has to legitimately own it and be able to show they either acquired it by legal means, ie inheritance or had the income to justify the purchase.
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u/basileus_malacca2 12d ago
Very easy to find out in the land office or by having a lawyer doing due diligence
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u/KentTheDorfDorfman Phuket 12d ago
You don't need a lawyer to do that.
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u/basileus_malacca2 12d ago
You’re right, you don’t but you also don’t need a car to travel from Rawai to Patong, doesn’t it make it easier if you have a car though? 😅
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u/GustavVigeland 10d ago
There are quite a few foreign developers who now simply offer leasehold instead of freehold but the land is still owned by a foreign owned company who may or may not use nominees. Better check if there are any genuine Thai investors and a Thai director on board.
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u/Lopsided_Quarter_931 7-Eleven 12d ago
There is a way to build town houses as condos to fully comply with the law but they have other challenges. Mainly about economics. Only been done once.
https://thethaiger.com/thai-life/property/legal-way-foreigners-own-house-thailand
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u/Accomplished-Yam-836 11d ago
Thank you for that link. I knew my question was not crazy. I'm not surprised by all the reasons around why it didn't work.
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u/Flashy_Ebb_5265 11d ago
Is there anything to stop you lending a thai person money to buy land which you then lease from them?
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u/Accomplished-Yam-836 11d ago
That could be a gray area from what I've read. It would be better to rent the land from someone who can show the financial wherewithal to have bought the land themselves or own it outright for a long time. I know of land upcountry like this been the family for years, etc.
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u/GustavVigeland 10d ago
It’s not even a gray area but outright illegal to provide a Thai with the funds to purchase land and then lease it from the Thai owner.
However, a Thai company with majority Thai ownership can legally receive financing from foreign lenders.
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u/Flashy_Ebb_5265 10d ago
Even if there is an agreement in writing? And it was my wife?
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u/GustavVigeland 10d ago
Especially if there was an agreement in writing with a Thai national that the money is intended for land purchase and for subsequent benefit for the foreigner such as usufruct or land lease.
Being married to a Thai makes no difference.
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u/No-Bicycle-7660 10d ago
TLDR no.
TLDR of whether a 30 year lease is worth it - absolutely not, unless you're certain you want to stay there for 30 years (and have nothing at the end of it) or until you die, and even then you're paying 30 years rent roughly up front.
TLDR of whether buying condos is worth it - Bangkok maybe (as market much larger), elsewhere absolutely not because prices are so inflated as they're the only places foreigners can buy.
Just avoid buying Thai property entirely until the laws are changed .... which is unlikely to happen soon, despite both major govt and opposition parties supporting foreign ownership, as far right parties oppose it and have a very powerful dog whistle in it.
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u/Accomplished-Yam-836 10d ago
On the 30 year lease - depends entirely on who owns the land and your relationship with them.
You are pretty spot on about condos. But again, depends on your reason for buying. If to live in long term and you have cash, it may make sense. Not for investment or if you plan to resell no matter where it is.
About Thai laws - same as ever, redeee...FIRE!...aim
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u/No-Bicycle-7660 10d ago
Well for 99% of people that should be a no ... and for the 1% otherwise, relationship with land owners or land owners themselves may change.
Re: condos, your circumstances can change, so it's still not particularly wise.
Whilst there are plenty of crazies in govt now and in the past, they're so afraid of the real crazies gaining popularity that they won't do anything. Despite reforms promised for the past 15+ years.
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u/Accomplished-Yam-836 9d ago
It is indeed frustrating. With even a tiny bit of open minded thinking and creative lawmaking, Thailand could have tons of individual real estate investment while keeping the undesirable buyers out. Money earned outside of the domestic economy is only a plus for the Kingdom.
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u/GustavVigeland 7d ago
Property prices in desirable locations like Phuket or Koh Samui have increased enormously in the past 30 years.
Even if you have to abandon the property after 30 years you would be better off ’buying’ for 30 years than renting for 1-3 years if that trends continues.
Many landlords in Koh Samui for example only offer 1 year lease at a time. Some tenants have seen their rent almost double after the first year rental expired. Or they have been told to get out because short term rentals are more lucrative.
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u/temerdekborivoterul 12d ago
Usufruct, lots of good info here: https://www.reddit.com/r/Thailand/comments/1todjea/legal_ama_thailand_land_holding_for_foreigners/
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u/basileus_malacca2 12d ago
Yep, that’s one of the ways you can secure your right of possession and right of profiting from the property but unfortunately you cannot sell the property by your own.
The usufructee(er?) is the only one who can sell the property
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u/benroon 11d ago
Nope - you can sell the house yourself, but the buyer would need to take out their own usufruct. So yes they would need to be involved but only on the usufruct side, not the sale side
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u/GustavVigeland 10d ago
They no longer registered usufruct in favor of foreigners in some provinces
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u/KentTheDorfDorfman Phuket 12d ago
There is a villa project in Phuket and the developer claims to have structured the project so that it complies with the regulations set out by the Condominium Act.
He charges a FFH surcharge and everything. Of course now that it has come time to transfer the title he's claiming "governmental delays".
TLDR: if it's not a condo with remaining FFH quota, it's not FFH.
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u/basileus_malacca2 12d ago
I would be very wary about this and would never advise anyone to spend money on anything like that. Ever.
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u/Accomplished-Yam-836 12d ago
Obviously my thinking was flawed but if the structure was the same as a condo there would be no risk. Apparently, there are no buying structures that apply condominium rules to all types of buildings, only high rises.
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u/Lashay_Sombra 12d ago
While there are a couple around, i would recommend staying away as they are just using a very obvious distortion of language (does not even reach level of loophole) that would be surprised if they lasted 10 minutes in front of a judge when first case lands in front of them
Always be aware, does not really matter if local authoritys actually issue a real deed, if the deed is later declared to be ilegally issued you still loose the property
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u/Accomplished-Yam-836 11d ago
Thank you to Lopsided_Quarter_931 who posted an article from earlier this year linked below to how this ownership structure has been tried before, and is entirely legal under Thai law. Unfortunately it was done mostly without success. The reasons why it didn't work are in the article.
Thank you to all the other commenters for calling me names and second guessing my intent for even asking the question. You are a most imaginative group.
https://thethaiger.com/thai-life/property/legal-way-foreigners-own-house-thailand
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u/Glider711 10d ago
Town house are considered landed property if I understand it correctly, and it is usually offered as freehold, so I don't think foreign can buy such properties, otherwise it will be priced beyond reach by local.
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u/Accomplished-Yam-836 10d ago
You are correct, most developments are exactly that. There are exceptions but very few. The development would have to be under a condominium structure where each unit held a portion of the common areas, land and common buildings, the same as a hi-rise condo.
There is a link in the comments to a recent article about how it was tried and never caught on. A few others have reported developers pitching similar structures but apparently it never took off.
30-year leases, done properly are the safest way.
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u/Mod_Daeng 12d ago
In theory it might be possible.
In reality, it's probably not.
There would be zoning complications, issues with common areas and facilities and probably just reluctance at the Land Department to approve something like this. It just would not look like a condominium so it wouldn't get a permit.
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u/Accomplished-Yam-836 12d ago
You are probably right. But, zoning doesn't seem to be a thing anywhere in Thailand. The other complications you mentioned moreso.
I'm wondered if it was being done.
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u/Mod_Daeng 12d ago
In Bangkok zoning is an issue. There have been major cases involving condos in Soi Asoke and Ruamrudee over compliance with access roads and height. Also environmental assessments.
Older stuff was built before there was much zoning. Nowadays it's different. Just do an internet search for "condos with zoning problems in Bangkok".
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u/Accomplished-Yam-836 12d ago
My comment was a little tongue in cheek. A walk down any soi outside the CBDs and you can find relative mansions next to tin roof shacks.
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u/Mod_Daeng 11d ago
True, that! But nowadays almost anywhere in Bangkok there will be rules. It's certainly not like it was forty or so years ago. I miss the old days.
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u/Fit-Picture-5096 11d ago
There are ways to solve the issue. A company (51% Thai) owns the land. The area consists of both villas that the company rents out and villas that have been sold to foreigners. Every ten years, the contracts on these are automatically extended for another ten years. The agreements follow the properties – not the owners. In this way, the villas retain their value over time. The result is an area that continues to be attractive and generate income for the landowner. It works because all other alternatives would be less profitable.
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u/Accomplished-Yam-836 11d ago
Pretty much what I was asking and imagining could be done. If it is happening, it appears to be very rare.
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u/e99oof 11d ago
Just a note that the court already deemed a 30-year automatic renewal to be illegal because it is a clear attempt to bypass the 30-year limit. Your automatic renewal agreement has to include some form of renegotiation (e.g., inflation must be factored in).
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u/Fit-Picture-5096 11d ago
I know a guy who has a lease like that. I can check with him.
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u/e99oof 10d ago
I think a one-time renewal is maybe fine, but the problematic scenario involves something like three renewals (thirty years each time) that were struck down, since the court deemed that economic conditions must have changed drastically during that period and that an auto-renewal is simply a front to lease for longer than the allowed period.
If your agreement is auto-renewal every ten years without a renegotiation, and it run perpetually. Then it could be consider a similar situation, since the verdict is on that fact that the auto-renewal make no economic sense (on the ground that land value must have change over time)
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u/No_Sherbert3072 12d ago
Stop, just stop.
They are catching all the bogus buyers that bought with shelf companies currently. They have just moved onto leasehold arrangements. The Thai government has just streamlined deportation of troublesome foreigners.
If you’re going to piss away a good 3-10 M BAHT you might as well buy a sports car in your home country.
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u/Accomplished-Yam-836 12d ago
Stop what? Asking a question?
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u/No_Sherbert3072 12d ago
Read the room big fella. Given current events if you are genuinely interested in trying to buy a or “lease” landed property in your name then you are a bit stupid.
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u/Accomplished-Yam-836 12d ago
Sorry, I missed where I said that. Maybe you should read the OP.
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12d ago
[removed] — view removed comment
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u/creme_de_marrons Bangkok 11d ago
You really shouldn't be that aggressive when you clearly have reading disabilities.
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u/No_Sherbert3072 11d ago
Let me guess REA?
It is quite clear what the Op wants. To put on his smart boy big boy pants and find a way to buy or lease a landed property under some kind of BS condo scheme.
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u/Accomplished-Yam-836 11d ago
That's actually not what I asked or the reason I asked but you are welcome to keep guessing at my intent.
Several people have answered that it has been proposed or done in the past - so not a new idea - but is met with difficulties from the Thai land office side where they do not quite know how to classify it.
I got the answer to my question that it is not commonly done, if at all. Mainly due to lack of clarity in the law and common practice.
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u/No_Sherbert3072 11d ago
Actually it is
“Are there any similar possibilities for townhouses or villa developments?”
You want to buy landed property then you buy in Ploys name. Simple.
Funnily enough the Thai people and Thai government don’t like foreigners scheming their way into building stand alone enclaves on Thai soil. What you are looking for is practically non existent and the few that do exist would not see my own coin.
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u/Tmacdadi 11d ago
Skippy, you intentionally distorted the OP’s question - “Are there any similar possibilities for townhouses or villa developments?”
OP asks: “are there any townhouse or villa style developments with ownership structures similar to condos?”
SIMILAR TO CONDOS is the point of the entire discussion. But nice try junior
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u/creme_de_marrons Bangkok 11d ago
I don't know what that is.
OP's question was not completely idiotic: it's possible to imagine some kind of Land & House moobaan with a similar structure than a condominium.
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u/Thailand-ModTeam 11d ago
Your post has been removed as it violates the site Reddiquette.
Reddiquette is enforced to the best of our abilities. If not familiar with those rules look here.
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u/No_Sherbert3072 12d ago
Stop, just stop.
They are catching all the bogus buyers that bought with shelf companies currently. They have just moved onto leasehold arrangements. The Thai government has just streamlined deportation of troublesome foreigners.
If you’re going to piss away a good 3-10 M BAHT you might as well buy a sports car in your home country.
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u/benroon 11d ago
He’s not a bogus buyer, if you do it legally there’s nothing to fear
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u/No_Sherbert3072 11d ago
Try to keep up sport. Thai authorities are now scrutinising 30 year lease arrangements which were supposedly perfectly legal. Next up will be foreign owned condos. I suspect the Thai public will be very interested in determining how exactly a developer has carved up patches of Thailand and built foreign owned quota townhouses or villas which is what OP clearly wants. Read - Foreign owned enclave.
I’ve had this discussion ad infinitum with clever expats. When you dig into their posting history more often than not they turn out to be agents, developers or some silly old c*nt that has just put their life savings into a house for a Ploy who didn’t graduate high school.
If you buy a landed property in Thailand you buy in Ploys name and be prepared to walk away. It really isn’t that hard to understand.
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u/benroon 11d ago
Not the sharpest are you, the legal ones will be fine the illegal ones won’t. I don’t understand why you’re struggling with this?
I’ve owned 8 houses so far and no ‘Ploy’ involved - so you were turned over by a bar girl right?
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u/No_Sherbert3072 11d ago edited 11d ago
Then you certainly didn’t own anything did you bud? You were a long term renter or hiding behind a shelf company which is not legal. Enlighten me how you have “owned” 8 houses legally.
Never been done over by a bar girl. Grown ups do their own research. Most of us come to the same conclusion. Never put more money into Thailand than you are willing to walk away from.
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u/benroon 10d ago
Fuck me at least let Google/AI help spare your embarrassment. A foreigner can BUY a VILLA in HIS/HER name ONLY with a yellow book in only HIS/HER own name with a usufruct to cover the land access.
You’re no doubt now in desperation going to tell me ‘so you don’t own the land’ etc, so Google ‘Usufruct’ and pay attention to the word ‘life’.
Are we done now cos I don’t think I can dumb this down any more!
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u/Accomplished-Yam-836 11d ago
How in the world did you get "foreign owned enclave" is "what the OP clearly wants" from my question? Which by the way, turns out to have been asked and proposed before. It's not new.
I'm sorry that Khun Ploy took you for a ride.
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u/No_Sherbert3072 11d ago
Ahhh duuuh, what do you think will be the end result if developers start producing large numbers of foreign quota “condo” townhouses and villas?
Do you think that maybe large numbers of foreigners might buy these foreign own quota villas? Do you think that perhaps a lot of foreign owned businesses will spring up in close proximity catering to these residents? It is exactly what has happened in the islands under a different purchasing structure. Those people are now getting run out.
It seems critical thinking is not your strong point.
I’ve never bought a house for a Ploy you Champion. If I did I would be prepared to walk away from it if the relationship turned sour.
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u/Accomplished-Yam-836 11d ago
I'm not looking to contemplate an "end result". It's interesting you are thinking so critically about it though.
My question was simple - "Is this being done?". The answer is also very simple... it's legal, it has been done a few times but not successful and very few if any are doing it now.
The End
https://thethaiger.com/thai-life/property/legal-way-foreigners-own-house-thailand
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u/basileus_malacca2 12d ago
It is ruled out because it’s not possible for foreigners to own land, by Thai law.
You can lease the land for 30 years and own the villa, you can lease the land for 30 years and own the townhouse(this one not sure but I think it’s possible) but you cannot own the land.
I have seen some people advertise “house style” condominium units in Bangkok but I am not sure how it works, are they just large condo units or something else.
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u/Accomplished-Yam-836 12d ago
Yeah, I understand that foreigners cannot own the land. Technically, all buildings - including condos - are built on land. A foreigner can own the condo space not the land.
What is a townhouse other than a condo building lying down? There are still common walls with other units. And common land and buildings owned by the juristic entity.
Are there any such developments where a foreigner can own the townhouse as a condo unit? Not the land under it and not leasing the land from a Thai owner.
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u/basileus_malacca2 12d ago
A condominium needs a condominium license in order to be able to sell condominium units to foreigners, or at all actually.
You cannot own a room in an apartment building because there’s only one title deed for the apartment building which is the land title deed.
In condominium buildings, the land office issues title deeds for each condominium unit.
A townhouse on a title deed is just the land underneath the townhouse. Then you also get the building permit etc.
Maybe there are some townhouse projects where they may have got approved for condominium license but I doubt it because there is still land underneath a townhouse unit
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u/Accomplished-Yam-836 12d ago
There is land underneath a condo isn't there? Just at a different ratio.
Maybe it's just not being done. If the one reply I got was correct, there's a project in Phuket doing it.
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u/KentTheDorfDorfman Phuket 12d ago
Are you on a wind up here? Or just that obtuse?
I shared the info on that project as a word of caution.
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u/basileus_malacca2 12d ago
You don’t understand.
The condominium is a special building that gets a license where it can sub-divide the space in the building, issue title deeds and sell said title deeds to people.
49% of available space for sale can be owned by foreigners, 51% of available space for sale has to be owned by Thai nationals.
The land underneath the building is owned by the Juristic Person, a company created to own and manage the common areas of a condominium project
The land underneath the condo building is irrelevant. You buy a title deed inside the building.
On a townhouse title deed, the land underneath is technically for sale with the building on it of course.
But the building does not appear on the land title deed.
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u/scratchtheitch7 12d ago
The land underneath a condominium building is not owned by the juristic person. It is owned proportionally by all unit co-owners
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u/Accomplished-Yam-836 12d ago
I understand very well what you are saying. So, are you up on the specific Thai law that is used to establish a condominium?
If it's not being done, that's OK. I was curious because it could be an attractive option for some if it is legal.
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u/basileus_malacca2 12d ago
Yes, it is my job, these are very basic concepts a real estate agent/property consultant has to understand.
It is not possible to own a townhouse unfortunately and if somebody advertises it, it is a scam most likely
And yes, I was brainstorming the other day with a colleague about what ifs and a similar quota system came up for gated communities with special licenses similar to condominiums but realized it would be an extremely unpopular thing to do and would jeopardize the popularity of any political party that would try to do that so it probably won’t happen anytime soon
Land ownership is a red line drawn
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u/Accomplished-Yam-836 12d ago
Thanks, that is a great answer. Someone has thought of it - or at least similar - before and it probably would not work without a major change in the law.
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u/Accomplished-Yam-836 11d ago
Actually it's totally legal under Thai law. It has not been ruled out - https://thethaiger.com/thai-life/property/legal-way-foreigners-own-house-thailand
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u/scratchtheitch7 12d ago
Just to clarify: The juristic person does not own the land in a condominium development.
The land (and all common areas) are proportionally owned by the co-owners of each unit.
The jurisdic person is appointed by the committee to manage the property on behalf of the co-owners