Nominee holdings in the gun

Revelations by the Ombudsman that one third of land in Thailand is owned by foreigners, some of it illegally, has raised concerns about whether authorities are doing enough to police land ownership laws.

The figure is based on research by Assoc Prof Piyanut Potawanit, a law lecturer at the National Institute of Development Administration. She explains ways around the problem in an interview with Bangkok Post reporter Mongkol Bangprapa. Here are the excerpts:

Phuket interior staff implicated in land scams

Investors invade 100 plots in two provinces

Several former high-ranking officials at the Interior Ministry were involved in land scams in Phuket and Phangnga provinces, the Office of the Public Sector Anti-Corruption Commission has found.PACC chief Pol Col Dusadee Arayuwuthi said the officials were involved in the misappropriation of more than 100 public land plots in the two provinces.

NATIONAL SECURITY SEMINAR (THAILAND)

Foreigners own 100 million rai

Some 100 million rai of Thai land is owned by foreigners, mostly through their Thai spouses or nominees, Auditor-General Sriracha Charoenpanit revealed yesterday. He said if this situation was unsolved, it could lead to later generations of Thais having no land to live on. Sriracha told a seminar yesterday on concealed juristic acts that threats to national security came from: firstly, drug problems ruining people, and secondly, the lack of land for future generations, as foreigners now owned a third of Thai land - about 100 million rai.

Housing and condo developments in Thailand

There are two types of property developments in Thailand:

1. the official government licensed condominium and housing projects and
2. the private property housing and apartment developments.

The official government licensed condo and larger housing developments seem somewhat safer because there is government control and these developments must have obtained various licenses and approvals. In addition the sale contracts must comply with minimum contract standards (sample regulation and sample news article) and consumer protection laws. The standard sale contracts must comply with ministerial regulations and are approved as part of the licensing procedure of the project. It offers some protection and guarantee for the freehold purchasers in these developments.

Buying real estate in Thailand

Thailand condominium acquisition and conveyance costs, tax and fees

When ownership of a condominium apartment in Thailand is transferred taxes and fees are collected at the time of transfer by the land offices where the transfer of ownership takes place. Transfer of ownership of a condominium unit in Thailand is subject to the following government fees and taxes:

Thailand real estate laws basics

THAI LAND LAWS restrict foreigners from owning land in Thailand and Thai laws in general limits foreign property ownership in Thailand. Buying real estate in Thailand follows a different legal process than buying realty in a country offering outright property ownership for foreigners. Property laws in Thailand are straightforward (foreigners cannot own land) but sales structures aimed at foreigners are often complex and confusing. Real estate in Thailand can legally be divided into the following objects:

• Apartments registered under the Condominium Act of Thailand
• Apartments NOT registered unde the Condominium Act
• Land
• House
• Land and house

Real estate rights

Property rights under Thai law to obtain ownership or an interest in these real estate properties can be devided into:

• Freehold ownership of a condominium unit registered under the Condominium Act within the foreign 49% ownership ratio of such a condominium
• Ownership over a building separate from its land
• A registered leasehold of up to 30 years of: 
  • a condominium unit registered under the Condominium Act... 
  • an apartment unit not registered under the Condominium Act (as part of a building)
  • land and/ or house
  • land (combined with ownership over the building upon the land)
• Right of superficies (alienation by the owner of the surface of soil of all rights necessary for building on the surface)
• Right of usufruct
• Right of habitation
• Controlling shares in a company that owns real estate

Thai off-plan condo purchase and escrow

Payment terms and risks when buying pre-construction

The standard payment schedule in off-plan condo projects in Thailand vary but normally require payment of a substantial part of the purchase price to the developer prior to completion of the condo and prior to transfer of ownership. A typical sale and purchase payments schedule is:

1. if any, a reservation agreement with a reservation fee of 100,000 baht (approx 3300 USD)
2. a deposit of 10 to 20% of the total condominium price on the execution date of the condominium sale and purchase agreement
3. monthly installments during the construction of the condominium with a final amount upon completion and transfer of ownership of the condominium (see sample payment schedule in clause 4 of this document).

Legal facts about a lease renewal option in a lease agreement

LAND LEASE agreements are commonly used in Thailand to transfer an interest in land to foreigners. The most common clause in a 30 year lease agreement aimed at foreign property investors is the lease renewal option, either included as 1, 2 (the 90-year lease) or more renewal terms.

UNDERSTANDING KEY-MONEY If you do not understand key money in Thailand this could lead to a foreseeable argument with the landlord when the lease ends or must be renewed. If you look at the term key money it is used differently in different parts of the world.