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Understanding Property Rights under Property Law in Thailand for Foreigners
Thailand remains one of Southeast Asia’s most attractive destinations for foreign residents, retirees, and investors. However, when it comes to real estate, property law in Thailand draws clear lines between what foreigners may lawfully own and the rights they may hold.
Contrary to common misconceptions, property law in Thailand does not grant foreign nationals the same property rights as Thai citizens, particularly in relation to land ownership.
The basis of the law for non-Thais to own property is contained primarily in the Land Code Act B.E. 2497 (1954), additionally sections (about property rights) in the Civil and Commercial Code, and a little-known provision of Condominium Act B.E. 2522 (1979).
The fundamental rule of thumb in property law in Thailand is that foreigner are not able to own land with the exception of specific circumstances.This is established plainly in Article 86 of the Land Code, which reads “possessing land is not permitted to a foreigner unless allowed by virtue of provisions in a contract concluded between two states or under any other legislation.” As of 2026, there are no such treaties in effect that allow general land ownership by foreigners in Thailand.
Despite this restriction, Property Law in Thailand provides a number of legal alternatives that grant foreign nationals secure and long-term rights over immovable property. These include: condominium ownership, which is permitted under specific quota and currency conditions; leasehold agreements, which allow for control of land and buildings for up to 30 years; usufruct rights, offering lifetime use of land in family-based arrangements; and building ownership, distinct from land, which is allowed in specific cases.
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Table of Contents
Condominium Ownership: Foreigners Can Be Owners Under Property Law in Thailand
Foreigners who wish to own real estate in Thailand with a freehold title will find that the most legally accessible and secure option is to purchase a condominium unit. The legal basis for this is provided in the Condominium Act B.E. 2522 (1979), which permits foreign ownership under certain strict conditions.
Legal Requirements for Foreign Condominium Ownership under Property Law in Thailand
Under Section 19 of the Condominium Act, a foreign national may own a condominium unit if three conditions meet :
1.The total foreign ownership in the building does not exceed 49% of the total sellable area of all units combined,
2.The purchase funds must be remitted from abroad in foreign currency, and the transaction must be documented through a Foreign Exchange Transaction Form (FETF) issued by a licensed Thai bank,
3.The ownership must be registered at the local Land Office, which ensures compliance with both the quota and currency requirements.
If all conditions are met, the foreign buyer receives full freehold ownership evidenced by a Chanote (title deed) for the condominium unit.
Condominiums are particularly attractive to foreigners because they combine legal clarity, resale potential, and security of tenure. Additionally, the ownership can be passed on through inheritance (subject to certain rules) or sold, provided the 49% foreign ownership quota is not exceeded at the time of transfer.
It’s important to note that Property Law in Thailand applies to registered condominium projects only. Standalone apartments or buildings not registered under the Condominium Act do not offer freehold rights to foreigners, even if sold as “condos” in practice.
Building Ownership: A Legal Right Separate from Land under Property Law in Thailand
Property law in Thailand recognizes that ownership of land and ownership of buildings can, in certain cases, be separated. This distinction is crucial for foreign nationals who may not legally own the land beneath a structure but may still hold legal ownership of the building itself.
According to Section 456 of the Civil and Commercial Code, a contract for the sale or construction of a building does not necessarily transfer ownership of the land it stands on. If clearly stated in the agreement and registered appropriately, the building can be owned independently from the land.
In practice, this legal right is exercised when:
- A foreigner holds a long-term lease on land and constructs a building;
- A Thai spouse owns the land and the foreign spouse finances and registers ownership of the house separately;
- Commercial or industrial leases permit construction of facilities by a foreign investor.
To secure building ownership under Property Law in Thailand, the construction must be authorized by a building permit, and ownership should be registered at the Land Office, preferably with clear reference to the separation of ownership in the lease or land-use agreement. This legal structure is particularly useful in combination with leasehold or usufruct arrangements.
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30-Year Leasehold: The Most Secure Long-Term Land Use Structure for Foreigners under Property Law in Thailand
As property law in Thailand prohibits foreigners from owning land, the most common and legally secure method for foreign nationals to control land is through a registered leasehold agreement. This is governed by Sections 538–571 of the Civil and Commercial Code.
Key Legal Characteristics
The maximum term for a lease of immovable property under Property Law in Thailand is 30 years, as set out in Section 540.
Leases for more than three years must be registered at the local Land Office to be enforceable against third parties.
The lease agreement must be in writing, signed by both parties, and clearly state the lease term and conditions.
Leaseholds under Property Law in Thailand are commonly used by foreign individuals or companies to secure long-term control over residential or commercial land and buildings. The leaseholder enjoys exclusive possession of the property, with rights to build, renovate, sublease (if permitted), and occupy the land for the duration of the lease.
Renewal Limitations
While lease agreements under Property Law in Thailand often include a renewal clause, such clauses do not create an enforceable legal right to an extension. Thai courts have consistently ruled, including in Supreme Court Decision No. 229/2521, that renewal provisions are contractual promises, not real rights. In practice, this means the renewal is valid only if both parties sign a new lease, which must be re-registered at the Land Office.
Leases should contain clear exit and enforcement clauses, and legal advice from an attorney familiar with property law must be obtained to properly structure the lease in Thailand.
The 30 year lease is still the simplest and most pragmatic method for non-Thai in obtaining right to use of the land in Thailand and assuredly has a sound footing legally.
Usufruct: Lifetime Use Rights in Family or Spousal Contexts under Property Law in Thailand
In situations where a foreign national is married to a Thai spouse or has close Thai relatives who legally own land, a usufruct provides a legally valid mechanism for the foreigner to use and reside on the property without owning it.
This right is established under Sections 1417 to 1428 of the Civil and Commercial Code. A usufruct grants the holder (called the “usufructuary”) the right to:
Use and occupy the property, collect fruits or income derived from the property (e.g. rental income), and live on the property for a fixed term or for life under Property Law in Thailand.
Legal Formalities
A usufruct must be created in writing and registered at the Land Office to be enforceable.
It may be granted for a specific number of years but often is registered as a lifelong right.
The usufruct expires upon the death of the usufructuary, unless terminated earlier by mutual agreement.
Usufruct under Property Law in Thailand is particularly useful for married couples where the Thai spouse owns the land, and the foreign spouse wishes to secure long-term residential rights. Unlike leases, there is no rent involved, and the right is often viewed as a gesture of trust or security within the family. However, the usufructuary must maintain the property and may be liable for damage or misuse under Section 1423.
Though usufructs are non-transferable and non-inheritable, they are legally recognized, relatively simple to establish, and highly effective in family property planning.
Land Ownership and Company Structures: Legal Prohibition and Nominee Risk under Property Law in Thailand
The most serious legal risk faced by foreigners in Thai property transactions arises when attempting to circumvent land ownership restrictions by using a Thai-registered company as a holding vehicle. While the Land Code allows companies with Thai majority shareholding to own land, the use of nominee shareholders—Thais who act on behalf of foreigners—is prohibited and prosecuted under Thai law.
The Foreign Business Act B.E. 2542 (1999), especially Section 36, strictly prohibits foreigners from using Thai nationals or entities to circumvent ownership restrictions. If it is found that:
The Thai shareholders are not genuinely involved in the business,
If the foreigner controls the company in practice (e.g., through loan-back agreements or preferential shares), then the structure is considered a nominee arrangement.
Thai authorities, including the Land Department, Department of Business Development, and Revenue Department, now conduct enhanced scrutiny of companies that acquire land. Investigations focus on :
– The financial capability of the Thai shareholders,
– The voting structure and profit distribution,
– Evidence of control or benefit by the foreigner.
In Supreme Court Decision No. 3241/2540, the court ruled that land owned through a nominee company could be confiscated because the company was acting as a proxy for the foreigner. This position has been consistently upheld under Property Law in Thailand in recent years.
Foreigners who engage in nominee company schemes risk :
– Land title revocation by the Land Department,
– Criminal prosecution,
– Loss of investment without compensation.
We strongly advise against using Thai companies to purchase land under Property Law in Thailand unless the company is a legitimate business with active Thai shareholders and full compliance with the Foreign Business Act.
Conclusion
While foreigners cannot own land in Thailand, the law provides secure alternatives such as condominium ownership, 30-year leaseholds, usufruct rights, and separate building ownership. These structures are legally recognized and enforceable. In contrast, using nominee companies is risky and illegal. Foreign individuals interested in real estate in Thailand should work with qualified legal counsel to ensure compliance, accurate documentation, and a full understanding of their rights and obligations. With proper legal planning under Property Law in Thailand, it is entirely possible to enjoy long-term security, residential rights, and investment value without ownership while still receiving full protection under Thai law.
FAQ
No, foreigners are not allowed to own land outright in Thailand.
According to Section 86 of the Land Code Act B.E. 2497 (1954), land ownership is restricted to Thai nationals unless a specific treaty or law provides otherwise. As of 2026, no such treaty is in force. Foreigners must explore alternative legal structures under Property Law in Thailand, such as leasehold or usufruct, to access land use rights.
A 30-year registered lease is the most secure and legally accepted method.
Under the Civil and Commercial Code, foreigners may lease land for up to 30 years. These leases must be registered with the Land Department to be legally enforceable against third parties. While leases may include renewal clauses, these are not automatically enforceable and must be re-executed and re-registered.
Yes, under the Condominium Act B.E. 2522 (1979), foreigners can legally own condominiums.
Ownership is allowed if the foreign ownership quota in the building does not exceed 49% of the total usable area. Additionally, funds for the purchase must be transferred from abroad in foreign currency and documented through a Foreign Exchange Transaction Form (FETF). Ownership is secured by registering the title deed (Chanote) at the Land Office.
Yes, Thai law permits foreigners to own buildings separate from the land beneath them under Property Law in Thailand. This is possible under Section 456 of the Civil and Commercial Code, provided the structure is registered independently and authorized by a valid building permit. This setup is common when a foreigner leases the land and constructs a house or commercial property on it.
A usufruct is a real right that allows a person to use and benefit from land owned by someone else—often used in family contexts.
Governed by Sections 1417–1428 of the Civil and Commercial Code, a usufruct allows a foreigner (e.g., a spouse) to live on or earn income from land owned by a Thai national. It must be registered with the Land Office and can be granted for life or a fixed term. It is non-transferable and expires upon the death of the usufructuary.
Not automatically. Renewal clauses in leases are not enforceable unless re-registered.
While many leases contain clauses promising renewal, Thai courts—such as in Supreme Court Decision No. 229/2521—consider these as personal agreements rather than enforceable rights. A new lease must be signed and registered at the end of the original term for the extension to have legal effect.
No. This practice is considered a nominee arrangement and violates Property Law in Thailand. Although companies with majority Thai ownership may own land, it is illegal for foreigners to control such companies through hidden agreements or proxies. Under Section 36 of the Foreign Business Act B.E. 2542 (1999), nominee structures are prohibited and subject to investigation, land title revocation, and potential criminal charges.
No. A usufruct is a personal right and cannot be transferred, sold, or inherited.
It is granted for the lifetime of the usufructuary or a specified term and automatically ends upon death. However, it remains an effective legal tool for family-based property arrangements, especially when the foreign party is not involved in commercial use of the land.
Using nominee shareholders to hold land on behalf of a foreigner is a serious legal offense.
Thai courts and agencies treat this as an unlawful attempt to bypass land ownership restrictions. In Supreme Court Decision No. 3241/2540, land acquired through such a scheme was confiscated. Penalties may include criminal prosecution, fines, and the permanent loss of the property.
Foreigners should always consult a licensed Thai legal expert before any property transaction under Property Law in Thailand. A lawyer can ensure that contracts are valid, that leases or usufructs are properly registered, and that all procedures comply with Thai law. Legal guidance helps avoid costly errors and protects the foreigner’s long-term interests in Thailand.