FOR FOREIGNERS INVESTING IN SAMUI
New legislation in Thailand preventing non-Thais from buying land is now in force. In brief; non-Thais cannot own land anymore - and that's official. The reason for the new legislation is that the old laws were being misused and exploited unlawfully by greedy western-owned corporations for their own benefit - while ignoring the plight of the Thai people.
Those fly-by-night corporations have now been well and truly clobbered. Their unlawful contracts are being torn up, they are being heavily fined and their property is being ex appropriated by the government. They are fortunate not to have ended up in prison!
Thailand is a democratic country and staunch ally of the West and has traditionally welcomed foreigners and still do of course - BUT - they will not tolerate what they perceive as lack of respect for their King and his subjects or their society and laws. Being a Buddhist country, respect for others and all living things is part and parcel of their daily life - it's what makes these people so very special. Everywhere, people openly show their courtesy and respect for each other by using the customary 'wai' - the holding of their hands together in a prayerful manner.
And needless to say, this respect thing is THE most important aspects of their lives - so they take it very seriously indeed. Yet, we must understand, these new laws are not so much designed to obstruct foreigners who wish to genuinely invest in the Thai economy but rather they are to shield the peasant-based economy - which is centered around agriculture - from the ravages of land inflation - which was starting to happen.
This new legislation applies all over Thailand but it is especially welcome on a small island like Koh Samui where available land space is very limited anyway. By keeping land prices artificially low, it will allow local Thais, who are very lowly paid compared to westerners, to buy and sell land between themselves. If land inflation (fuelled by western money) were allowed to take-off the locals would not be able to afford it. So for the islanders it's a good law and should be welcomed.
As Samui property investors ourselves we see these new laws as being good for us too - and by extension our clients. This is because private foreign investors (unlike corporate foreign investors) only want a long-term future where they can sell their acquisitions on the open market or pass them on to family via western inheritance laws. And those things, they can still do.
In the main, all people want and need lawful security-of-tenure (if they are buying a villa) or capital gains and profits (if they are buying a commercial business). In other words the actual bricks and mortar is really what matters to them. They are not actually interested in owning land per se (unless it's sitting on oil or gold!) because they are never in a million years going to 'work' that land with buffalo and plough or grow crops or plant trees.
So, as long as western investors have water-tight contracts drawn up strictly in accordance with current Thai law, by top level lawyers and using our copyrighted 'double-contract' package, then most wouldn't care who actually owns the dirt and rocks. The land itself is merely held on 30-years leases whereby the property owners pay peppercorn rents to the landowners every year - this is exactly as leaseholders do business in the west.
Furthermore, the new laws cannot stop the bricks and mortar (or the goodwill of a customer-based business - or its fixtures and fittings) from going up in value. That is bound to happen in any capitalistic marketplace - it's called supply and demand - and its basically that simple.
For more answers specifically relating to buying property on Samui click here - or if you want a confidential chat on your villa or business requirements please contact our Samui Support Team -Here
See the latest and even better news from the Thai Parliament click here
