Thailand Condominiums

Thailand condominiums market presents one of Southeast Asia's most compelling property investment opportunities, offering foreign buyers a rare and legally protected pathway to freehold ownership in the Kingdom. Governed by the Condominium Act B.E. 2522 (1979) and its subsequent amendments, this asset class has evolved into the preferred entry point for international investors seeking urban residences, coastal vacation homes, or income-generating real estate . However, navigating this market requires meticulous attention to a complex legal framework, strict procedural formalities, and an understanding of the shifting market dynamics that characterize Thailand's property landscape in 2026.

The Legal Foundation: Understanding the Condominium Act

The Condominium Act establishes the fundamental structure for all condominium developments in Thailand. Under Section 4 of the Act, a condominium is legally defined as a building that can be separated into individual personal units, each with its own ownership, combined with undivided co-ownership in common property such as land, structural elements, lifts, swimming pools, and other shared facilities .

This dual ownership structure is critical to understanding a purchaser's rights and obligations. When acquiring a condominium unit, the buyer receives two distinct forms of property rights: private ownership of the specific unit itself, evidenced by a unit title deed known as an Or Chor 2, and an automatic, indivisible share in the common property proportionate to the unit's size relative to the total saleable area of the project . This shared ownership is perpetual and cannot be separated from unit ownership.

The Condominium Act also provides important consumer protections. Any ambiguous provisions in sales agreements must be construed in favor of the buyer, and developer advertisements are deemed integral parts of the contract, meaning promotional materials can become legally binding representations . Furthermore, sales agreements must follow forms prescribed by the Minister of Interior to be enforceable, ensuring a baseline of fairness in transactions .

Foreign Ownership: The 49% Quota and Its Requirements

For foreign nationals, condominiums represent the most straightforward and secure method of property ownership in Thailand. The law establishes a clear framework permitting foreigners to hold freehold title to condominium units, subject to two critical conditions.

The 49% Foreign Quota Rule

Under Section 19 of the Condominium Act, foreigners may collectively own up to, but not exceeding, 49% of the total floor area of all units in a single condominium project . The remaining 51% must be held by Thai nationals. This quota is calculated based on saleable area, not number of units. For example, in a project with 10,000 square meters of total unit area, foreigners can own up to 4,900 square meters .

Before committing to a purchase, buyers must verify that the specific unit they intend to acquire falls within the available foreign quota. Due diligence should confirm that the developer has not already allocated the quota to other buyers, as transfers cannot proceed if the quota is exceeded .

Eligibility and the FET Form Mandate

To qualify for foreign freehold ownership, purchasers must meet specific eligibility criteria under the Condominium Act. The most common pathway requires bringing foreign currency into Thailand for the express purpose of purchasing the unit .

This process mandates strict documentation. When transferring funds from overseas, the payment instruction must explicitly state "for the purchase of condominium unit [Unit Number, Project Name] ." The receiving Thai bank will then issue a Foreign Exchange Transaction Form (FET Form) , previously known as a Tor Tor 3 . This document is mandatory for registering the transfer of ownership at the Land Department and serves as proof that the funds originated from abroad. Without it, the transfer cannot be completed, even if the quota is available.

The Purchase Process: From Due Diligence to Title Transfer

Acquiring a Thai condominium involves a structured process where each stage carries distinct legal and financial implications.

Pre-Purchase Due Diligence

Engaging independent legal counsel to perform comprehensive due diligence is not merely advisable—it is essential. This process should include several critical verifications :

The Sales and Purchase Agreement

The Sales and Purchase Agreement (SPA) serves as the principal contractual instrument governing the transaction. A well-drafted SPA should include precise property identification matching official records, a clear payment schedule with instalment milestones, and representations from the seller confirming clear title and absence of encumbrances . Importantly, the agreement should specify that the deposit is refundable if the developer fails to complete the project or obtain necessary permits .

Title Transfer at the Land Office

The culmination of the purchase process occurs at the provincial Land Office where the property is located. Both buyer and seller, or their duly authorized representatives holding a valid Power of Attorney, must appear in person . For foreign buyers, presenting the FET form and the original passport is mandatory. The Land Officer then transfers the unit title deed into the buyer's name, officially recording ownership.

Financing, Costs, and Tax Considerations

Mortgage Availability

Obtaining mortgage financing from Thai banks as a foreigner is challenging but possible, particularly for condominium purchases. Lenders typically require applicants to hold a valid work permit and demonstrate stable income in Thailand . Some international banks with Thai operations may consider foreign income, but approval is not guaranteed, and loan-to-value ratios are often lower than for Thai nationals.

Transaction Costs and Taxes

When budgeting for a condominium purchase, investors must account for several government fees due at transfer. These are typically calculated based on the government's appraised value of the property, which may differ from the contract price .

Annual Land and Building Tax

Since the implementation of the Land and Building Tax Act B.E. 2562 (2019), condominium owners are subject to an annual property tax. For residential use, rates range from 0.02% to 0.1% of the government appraised value, with a 10 million baht exemption for primary residences where the owner is named in the house registration book . For secondary residences or rental properties, the full rate applies from the first baht.

Condominium Governance: The Juristic Person and Co-Owner Rights

Every condominium in Thailand must establish a juristic person upon registration with the Land Office . This legal entity is responsible for managing common property, collecting maintenance fees, enforcing building rules, and maintaining financial records.

Management Structure

The juristic person is governed by a manager, who may be an individual or a juristic person (with a designated natural person acting on its behalf) . This manager plays a crucial role in overseeing operations, budgeting, and compliance. However, Thai law does not currently require specific qualifications, training, or certification for condominium managers, leading to concerns about inconsistent management quality and potential mismanagement . Legal scholars have called for amendments to establish qualification standards and a regulatory oversight body .

Co-Owner Rights and Voting

Unit owners have significant participatory rights, including attending and voting at general meetings, accessing financial records, and proposing agenda items . Voting weight is proportional to unit area, meaning larger units carry greater influence. Key decisions require varying thresholds:

Common Area Maintenance Fees

All co-owners are obligated to pay common area maintenance (CAM) fees, typically calculated per square meter of unit area . These fees fund building operations, repairs, and reserves. Non-payment can result in legal action and, in severe cases, liens against the unit.

Alternative Structures: Leasehold Condominiums

In some developments, particularly those built on leased land, units may be offered on a leasehold basis. Under this structure, the foreign buyer holds a lease over the unit rather than freehold title, while the land itself is leased by the juristic person or developer . Lease terms are limited to 30 years under the Civil and Commercial Code, with renewal options theoretically available but subject to legal uncertainty following recent Supreme Court rulings (such as Judgment 4655/2566) that cast doubt on automatic renewal clauses . Leasehold condominiums generally carry lower resale value and are less attractive to buyers seeking long-term security.

The 2026 Market Outlook: Trends and Projections

Thailand's condominium market in 2026 presents a picture of cautious adaptation rather than aggressive expansion. Following a subdued 2025, when only 16,408 new condo units were launched in Bangkok—a sharp decline from previous years—developers are prioritizing inventory clearance and strategic positioning .

Supply-Side Dynamics

New launches in 2026 are expected to remain below 15,000 units, with developers focusing on smaller, more targeted projects rather than large-scale developments . There is a pronounced shift toward the premium segment, with an increasing proportion of units priced above 100,000 baht per square meter and some super-luxury developments exceeding 200,000 baht per square meter . These projects often emphasize exclusivity, with fewer than 100 units, international hospitality branding, and distinctive architectural concepts .

Mass-market projects face headwinds from weak domestic purchasing power and high household debt, which continues to constrain access to mortgage financing . Developers are scaling back high-cost amenities to control long-term operational expenses and improve margin discipline .

Demand Drivers: Foreign Buyers Remain Critical

Foreign purchasers, particularly from China, continue to play an indispensable role in absorbing condo supply. Foreign transfers have remained stable since 2023, averaging 3,300–3,900 units per quarter, indicating consistent offshore demand . Developers are actively selling to Chinese buyers through direct channels and bulk transactions with agents, underscoring the segment's importance to market liquidity .

However, market analysts caution against over-reliance on any single buyer group, and developers are increasingly using data-driven approaches to identify sustainable demand rather than following past assumptions .

Regional Market Variations

While Bangkok remains the primary urban market with strong rental demand from expatriates and business travelers, other regions offer distinctive opportunities :

• Phuket combines coastal lifestyle appeal with tourism-driven rental potential, attracting lifestyle buyers and investors

• Pattaya provides more affordable coastal options with steady yields and proximity to Bangkok

• Chiang Mai appeals to those seeking cultural surroundings and a slower pace

• Hua Hin has emerged as a growing market for retirees and families, supported by improved infrastructure

Average rental returns across Thailand are estimated at approximately 5% annually, with higher yields possible in prime tourism locations .

Compliance and Risk Management

Avoiding Nominee Structures

Thai authorities have significantly increased scrutiny of unlawful nominee arrangements where foreigners attempt to circumvent land ownership restrictions through Thai companies . The Department of Business Development now uses data integration to identify inactive companies with no real business operations that hold property. Investors are strongly advised to adhere strictly to transparent options—foreign freehold condominiums or registered leaseholds—as nominee structures contravene the Land Code and Foreign Business Act and may result in forced disposal, penalties, or criminal liability .

Short-Term Rental Restrictions

Owners considering renting their condominium units should be aware that short-term rentals (e.g., through Airbnb) are often prohibited under the Hotel Act unless the building is specifically licensed as a hotel . Many condominium regulations also prohibit such practices, and violations can lead to fines or legal action from the juristic person.

Conclusion

Thailand's condominium market offers a legally secure and well-regulated pathway for foreign investment, underpinned by the Condominium Act's clear framework for freehold ownership, co-owner rights, and transfer procedures. The 2026 market landscape, characterized by selective development, premium project focus, and sustained foreign demand, presents opportunities for informed investors who approach transactions with diligence and legal awareness. Success in this market requires strict adherence to the 49% foreign quota, proper documentation of fund remittances through the FET form, comprehensive due diligence, and a clear understanding of ongoing ownership obligations. By navigating these requirements with professional guidance, investors can secure property rights in one of Asia's most dynamic real estate markets with confidence and security .