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Is it Safe to Buying Leasehold in Thailand?

Thai law protects the 30-year lease period, ensuring that the ownership remains uninterrupted during this time. However, there can be ambiguity around lease renewal, and it is unclear what provisions are in place to ensure that the lessor will renew the lease for another 30-year period.

In the past, issues have arisen when the property owner is an individual rather than a company. In these cases, Thai individuals sold the property via a leasehold structure but then passed away, and the legal successors of the lease were reluctant to extend the lease.

To avoid such complications, we recommend purchasing a leasehold property in Thailand through a Thai company, which is a legal entity that can provide continuity. Property developers often use a Thai company in part ownership with leaseholders to renew leases for owners.

It is advisable that all leasehold purchases involve a Thai company as the lessor, and that a lawyer supervises the execution of the Sales and Purchase Agreement to ensure that extension and termination clauses are properly stated.

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