Proposals to up foreign ownership quota for condos, extend leasehold rights rejected

While plans for a 10-year visa scheme for the wealthy and high-skilled professionals is moving forward, proposals to increase the foreign ownership quota for condominiums and the maximum lease for foreigners were rejected by Thailand’s Centre for Economic Situation Administration. The proposal to allow foreigners to hold ownership of one rai of land for residential purposes was agreed in principle.

In its meeting last month, chaired by PM Prayut Chan-o-cha, officials decided to scrap the proposals for an extension of leasehold rights to the current maximum of a 30-year lease for expats to a 50-year lease as well as an increase of the foreign ownership quota for condominiums, which is currently set at 49%.

Some say the foreign ownership quotas are still not being reached, so that rejected proposal won’t have much impact. The chief corporate strategy and creation at SET-listed developer AP Thailand Plc told the Bangkok Post that even Bangkok and Phuket, with large expat communities, are not hitting the 49% quota.

“Both Bangkok and major foreign-tourist destinations like Phuket are still seeing a condo ownership quota of less than 49%. As a result, the rejected proposals will not have an impact on property developers.”

The chairperson of property consultant CBRE Thailand told the Bangkok Post that the government should reconsider the proposal to extend leasehold rights from 30 years to 50 years. The extension of the leasehold rights is intended to make investments in large-scale projects more attractive. Foreigners cannot buy houses on a freehold basis, so a longer leasehold would potentially increase demand in the low-rise housing market.

SOURCE: Bangkok Post