Thailand mulls easing land lease rules for foreigners

The Thai government is exploring ways to ease land leasing regulations, potentially allowing foreigners to buy a larger share of condominium units and lease land plots for a longer term.

This move aims to address a property glut and stimulate the Thai economy in the face of weak domestic purchasing power.

Prime Minister Srettha Thavisin, visiting the popular tourist destination of Pattaya on Sunday, announced he had tasked the interior minister with revising regulations.

The changes could see the foreign ownership limit for condominium units in a project rise from the current 49 per cent to 75 per cent. This initiative targets an oversupply of apartment complexes in Thailand.

Additionally, the government is considering extending the maximum lease period for foreigners on Thai land from 50 years to 99 years.

Economists believe these measures could help absorb the condominium surplus and provide a much-needed boost to the fragile Thai economy. However, critics argue that the global economic slowdown might limit the effectiveness of attracting wealthy foreign buyers.

Some real estate experts, like Sopon Pornchokchai, disagree with the government’s assessment of a critical oversupply situation. According to the Real Estate Information Centre, there are roughly 440,000 unsold condominium units in Thailand, which developers estimate would take two years to clear.

Pornchokchai points out that this is significantly lower than the 600,000 units available during the 1997 Asian financial crisis. He believes the new policies will simply expedite the sale of existing inventory for major developers, offering little broader economic benefit.

Attribution: The Nikkei Asia