SECTION 6: A COMPREHENSIVE GUIDE FOR BUYING PROPERTY IN PHUKET
Investing in property is always a big decision. Buyers want to have the confidence that their real estate investment is a well-considered and safe choice.
The laws in many countries make property ownership pretty straightforward, but in Thailand foreigners are not allowed to own land, and this restriction extends to landed property such as villas and houses.
A foreign buyer may, however, buy freehold condominiums, which can be registered in their own name at the local Land Department. This section aims to cover every aspect of the laws governing property ownership, and is intended to help those discerning investors who are looking to invest in the Phuket property market to make intelligent and educated decisions.
Equipped with the right information, foreign buyers can make informed decisions. They can also use that information to deflect the inaccurate statements and questionable advice that sometimes comes from agents or developers. In many cases, buyers do not find out that they have made poor investment decisions – or even that they have flouted Thai Laws – until it is too late.
Buying and Leasing Property in Phuket Articles
SECTION 16: Phuket’s Ongoing Infrastructure Improvements
Phuket was once an island covered in jungle, with fishing villages dotted around the coastline, and with Phuket Town servicing the tin mining industry. Since the 21st century began in earnest, the island has seen incredible expansion, in both population growth, as well as incredible infrastructure, with new attractions and amenities springing up every year. As the world adjusts to the post Covid era, with more tourists arriving and with more Thais and foreigners calling Phuket their home, this infrastructure improvement program is unlikely to ease off or slow down.
SECTION 17: Phuket’s Negatives – Taking Off The Rose Coloured Spectacles
Although the Phuket property market tends to move independently of every other real estate market in the world, including the rest of Thailand, (except perhaps Koh Samui), it has not always been smooth sailing. Without the excessive borrowing seen in most countries, it has certainly been a much smoother trajectory, without any booms and busts. However, the real estate sector in Phuket has historically gone through many slowdowns, where prices have stagnated for many years, as demand waits to pick up to soak up any supply excesses. This section covers what to keep an eye out for in the years ahead, allowing investors to plan accordingly.
SECTION 18: The Black Swans of Tourism
This topic deserves its own section, mainly because the tourism sector has always been, and still is today, the lifeblood of the island. Without tourism, Phuket would have never seen the prolific growth it has experienced over the past 30 years, nor would the Phuket property market have reached where it is today. But unforeseen events do occur every few years, sometimes quite suddenly and cannot be discounted in the future. These may be local, national or international, but many do end up having an adverse effect on Phuket Island and its economy.
An Economic Overview for Thailand Property Investors
Being an island, it stands to reason that land in Phuket would be in limited supply. Add to that fact the consistent demand in the tourism sector, and the maturity of the real estate market, and
SECTION 8: Buying a Foreign Freehold Condominium in Phuket
Condominiums are the safest way for foreigners to purchase real estate in Phuket. Condominium law allows 49% of the living area in each condominium project to be sold to foreigners as foreign freehold. Foreign freehold ownership means the foreigner will own the condo unit in perpetuity i.e. forever. This ownership is registered at the local Phuket Land Department. If a foreigner is considering buying property in Phuket, then this article explains everything you'll need to know, and why a Phuket condominium is the best option!!!!
SECTION 9: The Option of a 30-Year Leasehold When Buying a Villa in Phuket
We do not necessarily dispute the concept of a Phuket leasehold, however, anyone entering into a Phuket landed property leasehold, must be aware of all the risks associated with this type of legal arrangement. A leasehold in Phuket is very safe, in the sense that it guarantees you a 30 year lease period, but any term over and above this initial 30 year period must be viewed as a mere verbal promise. It is not guaranteed. It is simply a verbal guarantee to extend the lease for further renewals, but if denied, it is questionable whether it will upheld in a court of law in the favour of the foreigner.
SECTION 10: Using a Thai Company Limited To Own Villas, Town Homes and Landed Property in Phuket
It is possible for a foreigner to own a Thai company in Phuket, if the Thai company is adhering to all the corporate laws of Thailand. However, if that Thai Company owns landed property, there are other implications. A company set up with the sole existence of owning property for a foreigner, with shareholders, who have not invested in the Thai company, and who the foreigners does not even know, are deemed as nominees. This is illegal. All foreigners entering a sale and purchase agreement in which they either transfer ownership of shares of a Thai Company Limited, or set up their own Thai Company must know these rules and the laws governing Thai companies, and the legal implications of their company owning land in Phuket.
SECTION 11: Evolution of the Phuket Property Sector – Why So Many Foreigners Own Villas Illegally
Foreigners in Thailand are not allowed to own land. However, over the last few decades, it has been commonplace for foreigners to set up a Thai company, which allows them maintain control of the company which owns the physical land. This is all fine, if done correctly. It really depends on whether the Thai company is adhering to all the corporate laws of Thailand, and if everything is done correctly, such as the company having legitimate Thai Shareholders. If everything is set up correctly, it may be acceptable to the authorities. This section explains why and how so many foreigners today are blatantly violating Thai laws, and for the most part, most have no idea they are doing so.
SECTION 12: An Overview On The Thai Baht
When any foreigner invests in Phuket property, they are also exposing themselves to the Thai currency. Any fluctuations in the Thai Baht to, obviously affects their investment value, depending on how the Thai Baht strengthens and/or weakens against their home currency. They make gains if the Thai Baht strengthens, yet they make losses when the Thai Baht weakens. However, the situation is different for buyers, who may hold off on a purchase should the Thai Baht get too strong. Currency fluctuations play a major part in the Phuket real estate market dynamics.
SECTION 13: Transferring Money into Phuket
If transferring money into Phuket to purchase a Phuket property, it is important to seek legal advice. Many foreigners make the mistake of transferring money into Thailand and then later finding out they can’t purchase the condominium (or building) without sending the money back out of Thailand again and sending it back in to get the correct documentation. This happens quite frequently, because many foreigners decide to move to Phuket without understanding the laws and procedures. This is especially the case with a condo purchase, as it is important to understand how important the FETF is when registering the condo in the buyer’s name, as well as repatriating the funds back the buyers home country upon sale.
SECTION 14: How Low Are The Fees And Taxes When Purchasing Phuket Real Estate?
Government fees and taxes are low in Thailand compared to most other countries. In fact, they are some of the cheapest in the world, which is a big attraction to potential Phuket property buyers. Although taxes and fees are easy to understand, they depend on the given situation, legal structure, and whether it is a new build or a resale condominium unit or a villa. A reputable lawyer will be able to ascertain the taxes due on any property purchase.
Overview of Phuket Real Estate Market
The Real Estate market in Phuket is correctly described as being unlike any other real estate market in the world. A mere 660 metres from the Thai mainland across the Sarasin Bridge, Phuket's property market differs even
SECTION 3: What Drives Real Estate Prices in Phuket and How to Ascertain Value
Real estate prices for both villas and condominiums in Phuket is governed by land values, labour costs and raw material costs. All of these have risen significantly over the past few years, but land values have been the driving force in the rise of property values over the last 3-4 years. This section aims to educate buyers on what drives prices in Phuket, both historically, presently, and moving forward. With a better understanding of the Phuket property market, buyers will be able to make discerning and educated decisions, before they purchase.
SECTION 4 : Valuing a Phuket Property
It is a known fact in the Phuket real estate industry that the true tangible price of a property is based solely on the final agreement made on price, between both the buyer and the seller. Of course, some buyers overpay for a property and have trouble selling again later. But the attraction and value of any singular property in Phuket is subjective, and beauty is in the eye of the beholder. A seller believes their property is worth a specific price, but the reality is that they will only achieve that asking price if one of the multitude of buyers agrees that the offer price is acceptable. If a property stays on the market for years, then the property is likely extremely overvalued.
SECTION 5: The Different Types of Phuket Property
There are many different types of Phuket property, with an array of different legal structures. This section assists to identify the different types of Phuket property for sale in Phuket. Although the various types are easy to define, sometimes these categorisations may overlap, creating even further sub-categories. If anyone is a serious buyer, it pays to understand the various types of properties that may be on offer in Phuket and to understand the legal connotations explained in later sections.
SECTION 6: The Inherent Risks to Buyers a Buyer Should be aware of – What Every Buyer of Property in Phuket Needs to Know
Foreigners who arrive in the “Land of smiles”, are mesmerised by how beautiful the Kingdom of Thailand is, and that surely in such an incredible place, full of such nice people, nothing can go wrong. Unfortunately, things often go wrong in Phuket, through either unfortunate circumstances, deliberate intentions or through the bereavement of the original lessee or land owner who made promises that the heirs refuse to accept. Buyers also need to be aware that many properties in Phuket are built illegally, and so the sale of the property at a later date, sometimes proves impossible.
Phuket Zoning Laws & Building Restrictions – What Buyers Must Know Before Building
Before building or buying land in Phuket, it’s essential to understand zoning laws, height limits, floor area ratios, and environmental restrictions that may affect your project.
SECTION 7: The Importance of Sound Legal Advice for Foreigners when Buying Property in Phuket
Foreigners are not allowed to own landed property in Phuket. This is a truth we have to accept. A foreigner is a guest in the Kingdom of Thailand, but every foreigner can seek quality legal representation from ethical lawyers to make sure that all is done correctly, and that foreigners are adhering to either condominium laws, and/or, more importantly, land ownership laws enforced strongly by the Thai authorities. Legal advice from an experienced Thai Lawyer is essential. If any foreigners decides to purchase a property in Phuket, then they must ensure, without a shadow of a doubt, that everything is done according the laws of the kingdom.
Buying Phuket Property Remotely – 15 Tips for Safe Long-Distance Investment
Buying property in Phuket from abroad is easier than ever — but it must be done right. These 15 tips will help you invest remotely and safely.
Reservation Agreements in Phuket – How to Secure the Property You Want with Confidence
A reservation agreement is the first step to securing your dream home in Phuket. This guide explains what it includes, why it matters, and how to protect yourself as a buyer.
Thailand Elite Visa – How to Live and Buy Property in Phuket Long-Term
Thinking of moving to Phuket? The Thailand Elite Visa offers long-term stay options for foreigners looking to buy a villa or condo in paradise. Discover the benefits, costs, and how to combine it with your dream property.
Securing Leasehold Property in Phuket – How Reciprocal Contracts Can Help Foreign Buyers
Buying a leasehold villa in Phuket? Special reciprocal contracts can help safeguard your long-term interest. This guide explains what they are — and how they fit into leasehold protection strategies.
Moving to Phuket – Facts Every Buyer of Phuket Property or Visitor Should Know – Lifestyle, Culture & Surprises
Planning a move to Phuket? This guide covers the island’s lifestyle, culture, expat community, and what to expect when relocating — including property options and area tips.
The Dangers of Using Nominee Shareholders to Buy Property in Phuket
Some foreign buyers are advised to use Thai nominee shareholders when purchasing property — but is it legal? This article explains the risks and what to avoid.
Guaranteed Buyback Property Schemes in Phuket – What Buyers Should Know
Developer buyback guarantees may sound attractive when buying a condo or villa in Phuket — but are they safe? This article explains what to look for and what buyers need to know.
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