Thailand Considers Law Revisions to Attract Foreign Real Estate Investment

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Picture courtesy: Kapook

 

Thailand is actively considering changes to its real estate laws to encourage foreign investment, as outlined by Finance Minister Pichai Chunhavajira.

 

The potential amendments aim to revise the "rights over leasehold assets" laws, offering more attractive lease agreements that could bolster the nation's economy. This initiative is part of a broader strategy to draw foreign investors, improving Thailand's economic growth, which has been sluggish and hampered by increasing household debt.

 

The real estate industry is crucial to Thailand's economy, influencing various related sectors. As domestic purchasing power diminishes, the government led by Paetongtarn Shinawatra, aims to adopt ideas from previous administrations to allow foreigners to invest in Thai real estate.

 

Current Thai laws restrict foreign ownership of land, presenting a political challenge. Thaksin Shinawatra, a key figure in the governing party, previously suggested that land sold to foreigners should first transfer to state management under the Treasury Department.

This proposal would let foreigners lease the land for up to 99 years, keeping land ownership with the state after lease expiry. Implementing such measures would require amendments to existing state land laws.

 

To further entice foreign investment, there's a move to extend lease terms from the current maximum of 30 years to 99 years.

 

This extension could make investments more appealing. In April 2023, the cabinet directed ministries to explore these longer lease terms, and by June, tasked the Interior Ministry with advancing these proposals.

 

Thailand's 2019 Rights Over Leasehold Assets Act currently allows lease terms from 3 to 30 years. These rights enable the transfer and use of property as collateral, yet the law hasn't been fully utilised or integrated into the market as intended.

 

Revised laws could better define and expand these leasehold rights, aligning them more closely with international standards and encouraging real estate investment.

 

In comparison, countries like England, Wales, France, and Cambodia have their own special lease laws, allowing long-term leases and granting tenants greater rights.

 

These models provide insights for Thailand as it seeks to modernise its approach to leasehold real estate, making it a more competitive and attractive market for international investors, reported Bangkok Post.

 

-- 2024-11-16