How to Legally Own Land in Phuket

Thailand is known as one of the most coveted tourist destinations in Asia. Foreigners flock to their largest island all year round, and some wish to invest their money on valued land properties either for residential or retirement purposes. Unfortunately, Thai laws do not generally allow foreigners to possess such.

There are, however, exceptions. Foreign nationals may own a unit in a registered condominium, a building, and a listed tenure by lease of up to 30 years for all kinds of titled land or buildings. You also cannot own more than 40 percent of shares in a Thai company that owns freehold land.

These are the popular ways for non-natives to own land:

• Long-Term Leaseholds

When you decide to lease in the Land of Smiles, you may hold 100 percent interest; you are allowed a 30-year contract with the possibility of renewing it for additional 30-year periods. That would be more than enough to last a person's lifetime. Carefully note the agreement if it only benefits the owner, stipulates harsh consequences in case you default, sub-leases the property, or makes changes without the landlord's consent.

• Limited Liability Company

Indexed companies are allowed to buy land; it's common for outsider minority share-holders to acquire interest in Thai real estate. Simply put, since you are allowed up to 49 percent of shares, the rest are held by Thai juristic persons (which your lawyer can arrange), who can sign over the control of their own shares to you. The property is under the company's name; as managing director, you control the voting of the other shares and yes, the land's ownership.

• Investment

A limited portion is allowed as an investment (for about 40 million Baht) for five consecutive years, provided that the land is used only as a residence.

• Thai Spouse

Under present rules, your native spouse is eligible to buy property in his or her name. However, both of you are required by the Land Department to sign declarations stating that the property was purchased through separate assets of the Thai spouse. However, this has the connotation that the non-native partner waives his rights on the possession. This could also be one of the problems during a divorce because of the non-Thai's lack of conjugal evidence. It is also illegal for a natural-born citizen to act as a nominee of a non-native person under the Foreign Business Act (1999). You might want to consult a lawyer to skilfully draft a Thai prenuptial agreement to prevent such dilemmas.

• Usufruct Habitation and Superficies

A foreign guest may obtain a life interest on certain kinds of property rights. A 'usufruct' is a right to manage (and profit from) land and is likened to a lease but is non-transferable with some important differences. The privilege of superficies can allow usage of another man's land for sitting a house and obtains ownership over its structures.

Discuss these options with an experienced Thai real estate lawyer. Diligent review of all these rules and appertaining documents and good negotiation skills are required.

• Private villa resources and motor accident claim specialists - adding the professional touch
• Speak to TAC Lawyers about compensation
• Rich people may need a private wealth management plan