Thai Nominee Crackdown Impacts Villa and Condo Markets

MGR Online•Economy•2d ago

Reader Briefing

Increased government scrutiny of foreign ownership structures through nominees is shifting the Thai tourism real estate market from villas toward condominiums and long-term leases.

•Thai authorities are intensifying audits of corporate structures and shareholder histories to identify nominees used by foreigners to illegally own land.
•The villa and house market in tourist cities is slowing as investors wait to see the impact of retrospective audits.
•The condominium market remains resilient, particularly with demand from Chinese buyers who follow legal ownership procedures.
•Foreign investors are increasingly turning to 30-year long-term lease agreements as a legal alternative to land ownership.

Overview

•Government agencies, police, and related departments have increased inspections of corporate registration and shareholder structures of foreigners holding real estate in Thailand.
•Some foreign investors use Thai nominees to hold shares in companies to bypass legal restrictions on foreign land ownership.
•Authorities are now linking data between the Land Department and the Department of Business Development to perform deeper audits on business operations and funding sources.
•Foreign investors seeking land, houses, or villas are slowing their decision-making due to fears of retrospective audits.
•The condominium market continues to move forward, especially with demand from Chinese buyers who operate within the legal framework.
•The villa market is shifting toward 30-year long-term lease models to comply with the law while meeting long-term usage needs.
•There are concerns that those attempting to evade the law may seek new methods, such as using family relationships or other third parties to hold rights.
•Surachet Kongcheep suggests that authorities must investigate not just share percentages but who actually controls and benefits from the assets.

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Key Entities

Person

Surachet Kongcheep(สุรเชษฐ กองชีพ)

Head of Research and Consultant at Cushman & Wakefield Thailand.

Organization

Cushman & Wakefield Thailand(คุชแมน แอนด์ เวคฟีลด์ ประเทศไทย)

A real estate consultancy firm providing market research and advice.

Land Department(สำนักงานที่ดิน)

A government agency holding data on real estate rights registration.

Department of Business Development(กรมพัฒนาธุรกิจการค้า)

A government agency holding company registration and shareholder information.

Place

Phuket(ภูเก็ต)ℹ️

A tourist city where foreign real estate ownership through nominees has been observed.

Pattaya(พัทยา)ℹ️

A tourist city where foreign real estate ownership through nominees has been observed.

Samui(สมุย)ℹ️

A tourist city where foreign real estate ownership through nominees has been observed.

Chiang Mai(เชียงใหม่)ℹ️

A tourist city where foreign real estate ownership through nominees has been observed.

Bangkok(กรุงเทพมหานคร)ℹ️

A city where foreign real estate ownership through nominees has been observed.