Ownership and investment returns are probably the most frequently asked of questions when buying real estate. In Phuket, the facts speak for themselves - million dollar properties have transferred hands and no less than 500 units are currently on the market islandwide.



There is no shortage of professional consultants (lawyers, architects, accountants) nor is there a language barrier. Over the years, a variety of methods have been devised to suit foreign ownership in accordance with Thai laws. In short, foreigners can own property in Thailand through exceptions or a Thai entity which they control. Long-term leases are the norm.

Q1. Can i have 100% ownership of a property?

A. Simple answer is yes. If it's registered as a Condominium (4 out of 10 in a project) there are no restrictions. Otherwise, you need to set up a Thai entity/corporation which is 51% thai-owned but through preferential share allocations, you have control. Another method is through an offshore holding (more to do with repatriation of investment returns, etc.), the structure of which depends on your needs. Also, under the Treaty of Amity between the US and Thailand, American citizens have certain rights free of the restrictions otherwise imposed on foreign investment in general. Briefly, the host of options here have been in place for sometime and widely practiced - do seek professional advice in any event.

Q2. Freehold or Leasehold?

A. An individual foreigner or a foreign company may acquire and own a house and land through a Thai company (the "holding company") and have control over such company as a director and via a preference share scheme. The alternative is to buy leasehold through a safe and secure government registered long term lease rights of up to 90 years - that is, 30 years for the right of use, with typically a 2 x 30 year extension totalling up 90 years in all. The lease can be transferred to a Third Party upon prior arrangements.

Q3. What return of investment am i looking at?

A. Of course that's a subjective question. But generally speaking, one can expect a 15-20% capital gain on prime properties in best locations by the time your home is completed and a further 10-20% once the entire development project is ready. In some case pre-completion re-sales of yet-to-be completed units have shown these figures as very achievable! Rental returns vary from property to property but across the board, a 5-7% net (after charges, management and service fees, taxes) is often cited as the average expected income from rental pools or other managed rental schemes of prime properties.

Q4. What is one "rai", "ngan" or "tarang wa"?

A. The "rai" is a unit of measurement equivalent to about 2.5 acres. 400 "wa" make up 1 rai; 1 wa is 4 square meters making 1 rai = 1,600 sq.m. One "wa" is also 100 "ngan", so 4 ngan make up 1 rai ... The usual costing is based on "xxxxx Thai baht" per "tarang wa" or square wa (per 16 sq.m.) Generally, the rate is 25,000 Baht or US$675 up per tarang wa for entry-level good property or US$200,000 - US$300,000 to start.

note: potential buyers should seek legal advice on all matters to ensure the integrity and security of purchase.