Buying a Condo in Thailand: Complete Freehold Guide for Foreigners

Introduction

Thailand has become one of Southeast Asia's most attractive destinations for foreign property buyers. Whether you are an expatriate settling in Bangkok, a retiree choosing the calm of Chiang Mai, or an investor drawn to the beaches of Phuket, the question inevitably arises: can a foreigner actually own property in Thailand?

The answer is yes, but with significant conditions. Thai law strictly limits what foreigners can buy. Understanding these rules before you sign anything is not optional; it is essential. This guide walks you through the entire process of purchasing a condominium in freehold (full ownership) in Thailand, from legal framework to closing costs, so that you can make a confident and informed decision. For personalized assistance, visit our real estate and condo services page.

What can foreigners buy in Thailand?

The first thing to understand is that Thai property law draws a clear line between land and buildings.

Land: Forbidden

Under Section 86 of the Thai Land Code, foreigners are prohibited from owning land in Thailand. There are narrow exceptions (through Board of Investment promotion, for example), but in practice, a foreign individual cannot hold a land title deed. This means that buying a house, a villa, or a plot of land in your own name is not possible through freehold ownership.

Condominium Freehold: Yes, Under Conditions

The Condominium Act B.E. 2522 (1979), and its subsequent amendments, allows foreigners to own condominium units in full ownership (freehold), provided that the building's foreign ownership quota has not been exceeded. This is the most common and secure way for a foreigner to own property in Thailand.

Leasehold: Possible but Limited

A foreigner can also hold a leasehold interest in property, including land and houses. However, a leasehold grants only a right of use for a maximum period of 30 years (per the Civil and Commercial Code), with renewals that are not legally guaranteed. It is not ownership in the traditional sense. For a thorough comparison, read our article on freehold vs leasehold in Thailand.

Freehold vs Leasehold: At a Glance

Before going further, here is a comparison of the two main options available to foreign buyers in Thailand:

Our recommendation: whenever possible, opt for freehold. It provides full legal protection, the strongest resale position, and genuine ownership that you can pass on to your heirs.

The 49% Foreign Quota

This is the single most important rule governing foreign condo ownership in Thailand. Under the Condominium Act, a maximum of 49% of the total sellable area (measured in square meters) of any registered condominium can be owned by foreigners. The remaining 51% must be owned by Thai nationals or Thai legal entities.

Key Points About the Quota

• The quota is calculated by total square meters, not by number of units. A building with 10,000 m2 of sellable space can have at most 4,900 m2 owned by foreigners.
• The juristic person (the condominium's managing body) maintains the register. Before purchasing, always request a written confirmation of the current foreign quota status from the juristic manager.
• If the quota is full (49% reached), a foreigner cannot purchase freehold in that building, regardless of whether a unit is available for sale. You would only be able to buy under leasehold.
• Some highly popular buildings in Bangkok, Pattaya, or Phuket may have saturated quotas. Always verify early in the process to avoid wasted time and money.

The Buying Process Step by Step

Purchasing a condo in Thailand follows a structured sequence. Here are the six key stages:

Step 1: Property Search and Selection

Identify the property that matches your criteria (location, size, budget, building quality). Work with a reputable agent or conduct your own research. Visit the unit in person whenever possible.

Step 2: Reservation Agreement (50,000 to 200,000 THB)

Once you have selected a unit, you sign a reservation agreement and pay a deposit, typically between 50,000 and 200,000 THB. This amount is usually non-refundable and secures the unit while the sale and purchase agreement is prepared.

Step 3: Sale and Purchase Agreement (SPA)

The SPA is the binding contract between buyer and seller. It details the price, payment schedule, transfer date, and conditions. Have the SPA reviewed by a qualified lawyer before signing. If the contract is in Thai only, insist on a certified English translation.

Step 4: International Fund Transfer and FET

Transfer the purchase funds from abroad via international SWIFT transfer in foreign currency. Your Thai bank will issue a Foreign Exchange Transaction Form (FET), known in Thai as Thor Thor 3 (ทท.3). This document is critical. More on this below.

Step 5: Due Diligence

Before the transfer at the Land Department, conduct thorough due diligence:

• Verify the seller's ownership through the title deed (Chanote)
• Confirm the unit is free of encumbrances, mortgages, or liens
• Check the foreign quota with the juristic person
• Review the condominium's financial health (sinking fund, common area fees)
• Ensure all building permits and condominium registration are in order

Step 6: Transfer at the Land Department

Both buyer and seller (or their authorized representatives) appear at the local Land Department office to execute the transfer. Fees and taxes are paid, documents are signed, and the Chanote title deed is issued in the buyer's name. The entire process typically takes a few hours.

How does the FET fund transfer rule work?

The Foreign Exchange Transaction Form (FET / Thor Thor 3 / ทท.3) is arguably the most important document in a foreign condo purchase, second only to the title deed itself.

Why the FET Matters

Thai law requires that the full purchase price of a freehold condominium must be transferred into Thailand from abroad in foreign currency. The receiving Thai bank converts the funds to Thai Baht and issues the FET as proof of this inward remittance.

Rules to Follow

• The transfer must be made via international SWIFT bank transfer
• The funds must arrive in foreign currency (USD, EUR, GBP, etc.), not in THB
• The minimum amount per transfer must be equivalent to USD 50,000 or more (or the equivalent in other currencies) for the bank to issue an FET
• The FET must state the purpose of the transfer (e.g., "purchase of condominium unit")
• The name on the FET must match the buyer's name

Keep the FET Safe

Do not lose your FET. You will need it:

• At the Land Department to register freehold ownership
• When you resell the condo in the future (to repatriate funds)
• As proof of legal fund transfer for any future administrative purposes

We recommend keeping the original in a safe location and storing certified copies and digital scans separately.

Fees and Taxes

Budget for the following costs when purchasing a condo in Thailand:

Transfer Fee

2% of the appraised value (set by the Land Department, which may differ from the sale price). Typically split 50/50 between buyer and seller, but this is negotiable.

Specific Business Tax (SBT)

3.3% of the appraised or sale price (whichever is higher). Applies if the seller has owned the property for less than 5 years. If SBT applies, stamp duty is waived.

Stamp Duty

0.5% of the appraised or sale price (whichever is higher). Applies only if SBT does not apply (i.e., the seller has held the property for 5 years or more).

Withholding Tax

Calculated on a sliding scale based on the appraised value and the seller's holding period. Paid by the seller.

Sinking Fund (One-Time)

A one-time contribution to the building's reserve fund, typically 500 to 600 THB per square meter. Paid upon first purchase of a new unit from a developer.

Common Area Maintenance Fee (Monthly/Annual)

An ongoing fee for building maintenance, security, and shared facilities, typically 40 to 80 THB per square meter per month, depending on the building's grade and location.

Total Acquisition Cost Estimate

As a buyer, expect total transaction costs (transfer fee, due diligence, legal fees) to represent approximately 3% to 5% of the purchase price, depending on the specific deal structure.

Pitfalls to Avoid

Nominee Structures Are Illegal

Using a Thai national or a Thai company as a "nominee" to hold property on behalf of a foreigner is illegal under Thai law (Land Code and Foreign Business Act). Authorities have intensified enforcement in recent years. If discovered, the property can be subject to forced sale, and both parties face criminal penalties.

No FET Means No Freehold

Without a valid FET, the Land Department will refuse to register freehold ownership in a foreigner's name. Transferring cash, using cryptocurrency, or sending funds through informal channels will not produce an FET. Plan your fund transfer carefully and in advance.

Saturated Foreign Quota

If the 49% quota in a building is already full, you cannot purchase freehold. Some agents may fail to mention this until late in the process. Verify the quota status before paying any deposit.

Untranslated Contracts

Many sale agreements are drafted in Thai only. Signing a contract you cannot read is a serious risk. Always obtain a certified English (or French) translation and have a qualified lawyer review it before signing.

Off-Plan Risks

Buying a condo off-plan (before construction is completed) carries additional risks: construction delays, developer insolvency, and the final product not matching promises. Conduct thorough due diligence on the developer's track record and financial health.

Checklist Before Buying

Before committing to a condo purchase in Thailand, ensure you have addressed every item on this list:

1. Confirm the foreign quota is available (written confirmation from the juristic person)
2. Verify the title deed (Chanote) and ensure the unit is free of encumbrances
3. Hire a qualified lawyer to review the SPA and conduct due diligence
4. Prepare the international fund transfer and confirm your bank can issue an FET
5. Obtain a certified English translation of all Thai-language contracts
6. Budget for all fees and taxes (transfer fee, sinking fund, legal fees, common area fees)
7. Inspect the unit in person (or through a trusted representative)
8. Understand the resale process, including the need for the original FET

Frequently Asked Questions

Can a foreigner get a mortgage to buy a condo in Thailand?

It is extremely difficult. Thai banks generally do not offer mortgages to foreigners. Some international banks with Thai branches (such as UOB, ICBC, or CIMB) may offer limited financing, but the terms are restrictive and the loan-to-value ratio is typically low (50% to 60%). Most foreign buyers purchase with cash transferred from abroad.

What happens to my condo if I pass away?

A freehold condo owned by a foreigner can be inherited by their heirs, including foreign heirs, through Thai probate proceedings. However, the heir must still comply with the 49% foreign quota rule. If the quota is full at the time of inheritance, the heir may be required to sell the unit. Having a valid will (ideally a Thai will for Thai assets) is strongly recommended -- our inheritance and will services can help you plan ahead.

Can I rent out my condo?

Yes. Foreign condo owners can rent out their unit. Rental income is subject to Thai income tax. If you plan to rent short-term (daily or weekly), be aware that this may require a hotel license under the Hotel Act B.E. 2547 (2004), and many condominium juristic persons prohibit short-term rentals in their house rules.

Disclaimer

This article is for informational purposes only and does not constitute legal advice. Thai laws and regulations may change. Consult a qualified lawyer before any real estate purchase decision.