How Thailand Leasehold System Works & Why It’s the Best Choice for Investors
March 22, 2025
Foreign Property Ownership in Thailand: What You Need to Know
Thailand offers incredible real estate investment opportunities—but for foreign investors, understanding the difference between leasehold and freehold is essential. While many buyers assume freehold ownership offers more control, the truth is more complicated.
Thailand’s property laws do not allow foreigners to own land directly, which makes freehold ownership risky and misleading unless structured properly through a Thai company.
📌 The Freehold Myth:
To buy freehold land, a foreigner must own only 49% or less of a Thai company. The remaining 51% must be held by Thai nationals, giving voting control to local shareholders—even if they’re silent partners.
⚠️ If Thai authorities suspect that Thai partners are “nominee shareholders” used only to create a loophole, the company can be declared invalid, and the property confiscated or demolished.
Leasehold: The Smart and Legally Secure Alternative
Thailand’s leasehold model is not only 100% legal for foreign investors, but also endorsed by the government as the safest long-term property structure for non-residents.
✅ How Leasehold Works:
A foreign buyer signs a 30-year lease agreement with the landowner (usually the developer).
Lease contracts can be renewed twice, for an additional 30 + 30 years—offering a total of 90 years of ownership security.
The buyer owns the villa or structure on the land outright, and the lease is registered with Thailand’s Land Office.
📌 Leasehold contracts are recognized under Thai civil law and are routinely upheld in court, offering real legal protection for foreign investors.
Why Leasehold Is Better Than Freehold for Most Foreign Investors
| Aspect | Freehold (via Thai company) | Leasehold (like at SOHO Residence) |
|---|---|---|
| Legal Risk | High – Thai shareholder must control 51% | Very Low – Leasehold is government-approved |
| Land Ownership | Only through a Thai company with Thai partners | Land is leased, villa is 100% foreign-owned |
| Government Inspections | Frequent checks to verify Thai shareholders are not nominees | Simple and secure registration with Land Office |
| Investment Flexibility | Complicated resale or transfer | Simple assignment of lease to new buyer |
| Protection in Court | Thai courts often side with Thai partners | Thai courts tend to protect leaseholder rights |
Leasehold offers the stability, security, and flexibility that foreign investors actually need—without legal gray areas.
SOHO Residence: A Better Leasehold Structure for Investors
At SOHO Residence, we’ve taken the leasehold model and made it even more convenient and investor-friendly:
💼 Smart Lease Payment Model
Instead of paying the entire 30-year lease upfront, investors pay for the lease in installments over 15 years.
This allows you to keep capital liquid and only pay for the portion you use.
If you sell the villa before the 30 years ends, the remaining lease is transferred to the new owner, along with the payment plan.
🛡 Legally Registered, Secure Contracts
Our lease agreements are fully registered at the Land Office, with built-in renewal options and investor rights clearly protected.
All legal documentation is handled by our in-house legal team, ensuring compliance at every step.
📈 Designed for Long-Term ROI
Our leasehold model is built to support passive income through short-term rentals, with projected annual ROI of 14–16%.
You get full control over your villa, rental income, and resale options—without the risks of a Thai company structure.
Final Thoughts: Leasehold is the Future of Foreign Investment in Thailand
💡 Key Takeaways:
✔ Freehold land ownership via Thai company is legally fragile and risky for foreigners.
✔ Leasehold provides long-term ownership, clear legal protection, and flexible resale.
✔ SOHO Residence enhances the leasehold model with installment payments, full legal compliance, and high-yield rental potential.
✔ It’s the smartest, safest way to invest in Thailand’s booming real estate market.