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Condominium ownership is best explained by looking at an example of a project that has 100 units for sale.
In this example, 49 of the total units in this building (or 49% of the total salable area) can be owned outright by non-thai nationals in their name. The ownership titles of these 49 units is referred to as Freehold or Foreign Quota.
This leaves 51 units remaining in the building (or 51% of the total salable). The freehold rights to these units are reserved for Thai nationals in what is commonly referred to as the Thai quota.
It is entirely possible for the Thai quota to exceed over 51% of the total ownership of a buildings salable area but the condominium act states that foreign quota can never exceed 49%.
In some of the holiday destination markets in Thailand, it is common for the foreign ownership quota to be filled. Due to demand from non-Thai nationals in these markets the developer will offer the rights to units outside of the foreign quota on a leasehold basis.
A 30 year lease period is legally protected under Thai law and ownership cannot be disrupted. It is common for developers to offer an additional two terms of 30 contractually obligating a total of 90 years.
Leasehold structures have to be examined on a case by case basis looking into the security. Prior to purchasing a leasehold property it is important to secure a copy of the lease agreement or get further clarity on these three points.
#1 - Who is the lessor? (an individual or a Thai Company) Securing a lease from a Thai Company offers much more security than a private individual.
#2 - Do I have voting rights as a Lessee? (Some lease contracts do not allow lessee to have voting rights)
#3 - Is there a succession clause in the lease agreement that will allow inheritance of the lease?
Work with your FazWaz sales consultant to ask these three questions to ensure your protection (long term) of leased property.
So you're probably asking yourself what is the best option for me? The truth is that it's not always an option between one or the other.
Are you purchasing the property from a private individual (Secondary Market) or are you purchasing a new home direct from the developer (Primary Market)?