Tourist Condos and Apartments
Licensed condos vs leasehold residential apartment buildings in Thailand
In tourist resort areas such as Pattaya, Phuket and especially Koh Samui leasehold apartments are often confused with condominiums licensed and registered under the Thailand Condominium Act. On the outside these buildings look the same but legally they cannot be compared. Buying a condo in a building registered under the Condominium Act is not the same as buying a leasehold apartment in an unregistered apartment building.
With leasehold apartment in this blog post we refer to an apartment complex not registered under the Condominium Act. For lease of a condominium unit registered under the Condominium Act we refer to the article 'lease purchase of a condominium'
Leasehold apartments are not condominiums governed by the Condominium Act.
Unregistered condos have several drawbacks which among others relate to the lack of ownership rights, lack of tenant and consumer protection laws and the principle right of control over the building and common areas by the owner of the building and not by the unit owners as is the case in a true condominium registered under the Condominium Act.
What are the main differences:
| REGISTERED under the Condominium Act | NOT REGISTERED as a condominium | ||
| 1. legally recognized government issued and administrated individual ownership title deeds |  |
1. individual lease agreements over the units, a lease of part of the building |  |
| 2. as freehold owners free to sell and dispose of the condominium unit | |
2. selling is assigning the lease and requires consent of the owner of the building/ landlord |
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| 3. co-ownership in the condo common areas, including the land on which the building sits | |
3. if any, an interest in the common areas must be created separately | |
| 4. management and control over the building lies with the unit owners | |
4. management and control over the building lies with the owner of the building/ landlord | |
| 5. legally set democratic voting right system by the owners of the units on how the condo is managed | |
5. the occupants of the building are basically tenants and have to comply with rules set by the owner of the building |
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| 6. condominium development is a ‘contract controlled’ business and must offer minimum consumer protection | |
6. the contract structure under which the leasehold apartment is sold could go either way, pro lessee or pro lessor | |
| 7. owner occupied properties are not subject to housing and land tax | |
7. leased properties are subject to housing and land tax | |
| 8. exclusive and absolute ownership of the unit for an indefinite period not limited by time and transferable by succession |
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8. possession under a lease is for a fixed term and limited to a maximum of 30 years and is terminated upon death |
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Are leasehold residential apartments legal
Legally there is nothing against leasehold apartments and generally these apartments are less expensive, but as a buyer of a leasehold apartment you should double or triple check the agreements involved and intention of the developer. These structures do not offer the same protection in the law as is offered in a licensed condominium development project. One offers government control, actual ownership and protection under the Thailand Condominium Act, the other offers possession through a lease agreement under the Civil and Commercial Code (what is lease in Thailand) and must offer individual protection through private agreements. The rule with apartments in tourist areas such as Pattaya, Hua Hin, Samui and Phuket is know what you are buying and let the buyer beware.
Is it a leasehold apartment or a true condominium?
If you are buying a condo off-the-plan the sale agreement will clearly mention that it is an apartment project under the Condominium Act B.E. 2522 and that transfer of ownership will take place at the land department and if it concerns a leasehold or freehold purchase. In case of a true titled condominium each condo unit will have a government issued title deed as shown on the right. Leasehold apartment sale structures will usually involve a lease agreement and/ or maybe a share transfer and management agreement.
A leasehold apartment could have separate house books stating the address of the unit, but do not confuse a house book (Tabien Baan) with the ownership document (ownership title deed).
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