Making the move to Chiang Mai Some thoughts and advice from Jasmine Homes Managing Director Steve Malone So you've fallen in love with Thailand (or someone in Thailand!) and are considering a permanent move here? For many foreigners Chiang Mai is the ideal area to relocate to because it offers everything an expatriate could want. The climate is more comfortable than places further south, with average daytime temperatures of 25.9º C (78.6º F) compared with Bangkok's average of 28.1º C (82.6º F). The city has every type of food imaginable, including many delicious dishes found only in Chiang Mai and you will find hundreds of restaurants here offering food ranging from simple noodle dishes to elaborate European cuisine. For relaxation there are parks, cinemas, bowling complexes, swimming pools, cultural centres, churches, Temples (more per square kilometer than Bangkok!) in fact the opportunities for leisure are almost endless here. Leisure activities are not limited to the daytime here either. For those who want a little night time action there are clubs, pubs, restaurants and shows - and plenty of Disco's for those who like to dance till they drop. Land and property One of the other great attractions of Chiang Mai is the huge range of land and property available at very affordable prices. Maybe you've already looked at some of these on this website - but what about foreigners owning property? Thai law forbids foreigners from owning land (except in very special (read expensive) circumstances). Oddly enough, the law does not stop foreigners from owning buildings - only the land they sit on! Despite this fact, many foreigners settle in Chiang Mai and have beautiful homes that they could never have dreamed of owning in their home countries. Some have a Thai wife or husband and the property is in their partner's name. But many don't have Thai partners so that option is out for them. So how do they do it? There are a number of options that are available for a foreigner wanting to acquire property. Jasmine Homes have facilitated each of these options for different foreigners in the past and our legal advisors are well versed in the procedures and can plan and implement a scheme to suit your circumstances. 'Proxy' ownership This is the simplest (and most dangerous) option. The property is paid for by the foreigner but title is transferred to a Thai national who will own the property 'on your behalf'. If you have a very good and trusted Thai friend or relative then this may be an option, but be VERY SURE about the person whose name is going to be on the title deeds. Earlier this year I found some rental accommodation for an American couple who had done just this. They returned home for 3 months and came back to Chiang Mai to find that their home was occupied by a Thai couple who claimed to have purchased the home from their 'trusted friend'. The involvement of the Police and lawyers could do nothing to get the home back for this couple and their 'trusted friend' could not be found. It had been legally sold and registered in the name of the new owners. Thai partner's name If you have a Thai partner, then this is also a simple option. If you are married, then at the time of transfer you will be required to sign a document agreeing that the money used to buy the property was not yours, and that the property will not form part of the 'communal marriage property'. This means that if you divorce or separate it will remain the exclusive property of your (estranged) partner. You get nothing. Obviously if you are not married then it is really the same as 'Proxy ownership' - see above. Thai company - see update below Although foreigners cannot own land, legally formed companies with foreign shareholders can do so. Company law is complicated here (isn't it everywhere?), but in general a Thai company cannot have more than 49% of its shares owned by foreigners, and if the company is going to own property then this reduces to 39%. If the company has been set up by a competent lawyer then you can still have control of the company despite the fact that you will own less than 50% of the shares. It is beyond the scope of this article to discuss all of the intricacies of Thai company formation, but Jasmine Homes have legal experts who can advise you if required. My opinion is that this is a sensible route to take if you intend to operate a business here in Thailand, but historically people have formed companies solely for the purpose of acquiring property and the Thai authorities have stated that they wish to close this loophole, and in Thailand when they change the law they can (and have) made it retrospective! So tread carefully if you intend forming a company purely as a vehicle to own property. Update As mentioned above, I had concerns about using the 'Thai Company' route to acquire property. The Thai authorities have now taken steps to close this loophole and any company with foreign shareholders that tries to register the purchase of land is now subject to a full investigation to ensure that the company has not been set up to enable foreigners to acquire land. Leasehold This option has become much more popular recently, due to a relaxation in Thai law that allows foreigners to lease land for up to 30 years (with 2 successive renewals making 90 years). In fact, if the land is for commercial use (an office for example) then each lease can be for 60 years each term. Typically the lease will allow the tenant to own the land at any time in the future should Thai law be changed to permit it, and also allow ownership to be transferred to any person (or company) nominated by the tenant at any time. This means that the lease can be converted to ownership at any time, and without further payment (other than Thai tax payable on transfer). The lease, if used as part of a 'superficies agreement' also entitles the tenant to full ownership of all buildings and developments erected on the land and full rights to transfer the benefit of the lease as they see fit. One other benefit of Leasehold is that the tax payable on registration is much lower than the tax on an outright purchase. This option can also be used in conjunction with any of the other options above. In other words, the property can be purchased in the name of a company or Thai partner and then leased to the foreigner, giving them effective ownership for 90 years. Which option for me? Without knowing your exact circumstances it is impossible to answer that question. I would be pleased to give you my recommendation, or alternatively Jasmine Homes retain a fully qualified and registered Thai lawyer who speaks good English and understands Thai property laws much better than we do. Khun Thewin has dealt with outright purchases, company ownership and leasehold contracts for many foreigners and understands their concerns. If you would like more information or a consultation with him then feel free to for a quotation. This service is available regardless of whom you are buying property from. Please feel free to contact us if you have any questions that haven't been answered here. We'll do our best to answer you as quickly as possible and if we don't know the answer, we'll try to find out! Steve Malone Managing Director - Jasmine Homes Co Ltd

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