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Exploring Ownership Structures for Real Estate on Koh Samui: Pros and Cons

Posted by Form on January 6, 2024
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Investing in real estate on the picturesque island of Koh Samui requires careful consideration of ownership structures. Understanding the pros and cons of different ownership models is crucial for making informed decisions in this tropical haven. Let’s delve into the various ownership structures and explore the advantages and disadvantages associated with each.

Thai Freehold Ownership:

Pros:

1: Absolute ownership of the property.

2: Full control over the property’s use, lease, and resale.

3: Eligibility for a Thai mortgage.

Cons:

1: Restrictions on land ownership for non-Thais.

2: Limited to 49% foreign ownership in condominiums.

Leasehold Ownership:

Pros:

1: Ideal for those unable to secure freehold ownership.

2: Typically renewable for multiple terms.

3: Offers control over the property during the lease period.

Cons:

1: Limited control beyond the lease period.

2: Resale value may be affected as the lease approaches expiration.

Thai Company Ownership:

Pros:

1: Allows full ownership of land through a Thai-registered company.

2: Facilitates joint ownership with other foreigners.

3: Potential tax benefits and increased flexibility.

Cons:

1: Requires a trustworthy Thai partner or nominee shareholders.

2: Complex legal structures may involve higher setup and maintenance costs.

Nominee Structure:

Pros:

1: Permits foreign ownership through a Thai nominee.

2: Simplifies the purchasing process.

3: Can provide a sense of security.

Cons:

1: Legally questionable and subject to changing regulations.

2: Potential risks of nominee misuse and loss of control.

Conclusion:

Selecting the right ownership structure for real estate on Koh Samui involves a careful weighing of pros and cons. While freehold ownership offers complete control, it comes with limitations for non-Thais. Leasehold arrangements provide flexibility, but long-term control might be a concern. Thai company ownership and nominee structures can be viable options but require meticulous planning and adherence to legal requirements.

Before making a decision, consulting with legal and real estate professionals in Koh Samui is imperative. Each individual’s circumstances and objectives differ, and finding the optimal ownership structure ensures a secure and satisfying real estate investment experience on this tropical paradise.

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