Legislative Initiatives on Land Lease and Foreign Quotas
Thailand is considering two bills that could change the game for foreign property buyers. The first concerns extending the maximum land lease (leasehold) term from 30 to 50 or even 99 years. The second proposes raising the foreign ownership quota in condominiums from the current 49% to 75% in select projects. Both initiatives have been under discussion in parliamentary committees since 2024 but have not yet been adopted.
The reason for the discussions is the government's desire to attract more direct investment and support the property market after the pandemic. The Ministry of Finance and the Board of Investment of Thailand (BOI) have repeatedly emphasized the need to simplify rules for long-term residents and wealthy foreigners.
Current Rules for Foreign Property Ownership
Currently, strict restrictions are in place, established by the Land Code (Article 86) and the Condominium Act. A foreigner cannot own land directly. The only type of full ownership (freehold) available to non-residents is an apartment in a condominium, subject to three conditions:
- The share of foreign owners in the building does not exceed 49% of the total area of all units.
- The money for the purchase was transferred to Thailand from abroad in foreign currency, with a bank certificate Foreign Exchange Transaction Form (FET).
- Ownership is registered at the Land Office at the location of the property.
For houses and villas, foreigners use registered land lease for up to 30 years with the possibility of extension for two more 30-year periods (90 years in total theoretically, but extension is not guaranteed by law). A house on a plot can be registered as foreign-owned separately from the land-through superficies or usufruct rights.
The 49% Quota and Its Impact on the Market
The quota is measured by area, not by number of units. One large penthouse of 300 m² "consumes" as much quota as five studios of 30 m² each. If the quota is exhausted, new units can only be sold to foreigners on leasehold terms for up to 30 years, or registered to a Thai entity.
In popular Pattaya areas-Wong Amat, Pratumnak, Jomtien-many new projects exhaust the foreign quota even at the pre-sale stage. Buyers are forced to either agree to leasehold or look for properties on the secondary market where quota is still available.
What the New Bills Propose
Extension of Land Lease Term to 50-99 Years
The first bill provides for increasing the maximum registerable land lease (leasehold) term from 30 to 50 years at once, with the possibility of extension for another 49 years. Some versions of the document circulated in 2024-2025 even mentioned 99 years as a single term, similar to Singapore and Hong Kong.
Advantages for foreigners:
- More long-term legal certainty. Currently, extension after the first 30 years depends on the goodwill of the land owner.
- Increased liquidity of leased property. Banks are more willing to finance the purchase of a villa on a 50+ year leasehold.
- Reduced discount on resale. Currently, a villa on a 30-year lease loses 20-30% in value compared to a freehold condo.
Important nuance: the bill does not abolish the ban on land ownership. It only concerns the extension of lease registered at the Land Office. Lease agreements not registered with the state remain unprotected and can be challenged.
Raising the Foreign Quota in Condominiums to 75%
The second initiative concerns the Condominium Act. It proposes allowing developers to increase the share of foreign owners to 75% in projects meeting the criteria:
- Minimum unit value-from 10 million baht.
- Location in special economic zones (for example, the Eastern Economic Corridor EEC, which includes Pattaya and the provinces of Rayong, Chonburi, Chachoengsao).
- Compliance with "green building" and energy efficiency standards.
This measure targets the premium segment and investors ready to invest from $300,000. For the mass market (studios 2-4 million baht), the quota will remain at 49%.
Current Status of Bills and Adoption Timeline
As of early 2026, both bills are at the discussion stage in committees of the National Assembly of Thailand. The Ministry of Interior and the Ministry of Finance presented agreed versions of the texts at the end of 2025, but a final parliamentary vote has not yet been scheduled.
A decision is expected in the second half of 2026. If the laws come into force, the transition period for registering new contracts will be 180 days-this is the usual time given for by-laws and Land Office instructions.
Important: changes do not take effect until official publication in the Royal Gazette. Any transactions executed "in anticipation of the law" are legally unsafe.
Tax Benefits 2026-2027: Reduction of Registration Fees
In parallel with the discussion of the bills, the government extended the program to reduce registration fees when buying property. According to notices from the Ministry of Interior published in the Royal Gazette on July 1, 2026, benefits are valid until June 30, 2027.
Program Conditions
Discounts apply to:
- Detached houses, townhouses, commercial buildings, condominium apartments.
- Purchase price, assessed value and mortgage amount-each must not exceed 7 million baht.
- Buyer-only an individual with Thai citizenship.
Fee rates:
| Type of Fee | Standard Rate | Preferential Rate (until 30.06.2027) |
|---|---|---|
| Sale registration | 2% of assessed value | 0.01% |
| Mortgage registration | 1% of loan amount | 0.01% (only with simultaneous registration with sale) |
For foreigners, this program is not directly applicable as Thai citizenship is required. However, indirectly it reduces the overall transaction cost for Thai buyers, which stabilizes secondary market prices and reduces competition for new construction.
Land and Building Tax: 2026 Rates
Since 2020, Thailand has had the Land and Buildings Tax Act B.E. 2562 in effect. The tax is paid by all owners-both Thais and foreigners owning condominiums.
Rates for 2026 (established by Royal Decree):
| Property Purpose | Maximum Rate | Typical Rate in Pattaya |
|---|---|---|
| Agricultural use | 0.15% of assessed value | 0.01-0.03% |
| Residential use | 0.3% | 0.02-0.05% |
| Commercial use | 1.2% | 0.3-0.7% |
| Vacant property | 1.2% | 0.6-1.0% |
The assessed value is determined by a provincial committee and is usually 20-40% lower than market value. For a 60 m² condominium assessed at 3 million baht, the annual tax will be 600-1,500 baht (about $17-43).
In 2021 and 2022, the government provided a 90% discount on tax in connection with the COVID-19 pandemic. Since 2023, discounts have been canceled, and tax is collected in full.
Risks of Using Nominee Thai Companies
Some agencies offer foreigners to circumvent the ban on land ownership through registration of a Thai company in which 51% of shares formally belong to Thai nominees. The Land Code (Article 86) and the Foreign Business Act directly prohibit such schemes.
Since 2025, the Department of Business Development, the Revenue Department and the Land Department have been conducting joint inspections of companies with signs of nominee ownership. Penalties:
- Loss of land ownership rights.
- Criminal liability: up to 2 years in prison under the Land Code, up to 3 years under the Foreign Business Act.
- Fines and additional tax assessments.
Safe alternatives: registered land lease (leasehold), superficies right, land registration to a Thai spouse with written confirmation of the source of funds.
What This Means for Buyers in Pattaya
For Russian-speaking investors and residents, changes in legislation may open new opportunities, but it's too early to rely on them before official adoption.
If You Plan to Buy a Villa
Currently, it's more reasonable to arrange a 30-year land lease with Land Office registration than to wait for hypothetical 50 or 99 years. The villa market in East Pattaya, Jomtien and Na Jomtien offers properties from 8 million baht with plots of 200-400 m². A registered lease gives the right to sell, bequeath or sublease the villa.
If the law on extending the lease term is adopted, holders of existing contracts will be able to re-register them under new conditions-usually such laws have retroactive effect for bona fide tenants.
If You're Buying a Condominium
Check the remaining foreign quota before making a deposit. The developer or agent must provide an extract from the condominium juristic person indicating the occupied and available area for foreigners.
In premium projects in Wong Amat (Central Wong Amat, Riviera Wongamat), the quota is often exhausted. An alternative is to buy on the secondary market from a foreign owner selling a freehold unit: the quota is not consumed but transfers to the new buyer.
If the quota increases to 75%, prices for premium new construction may rise by 5-10% due to increased demand. Buying now, while the 49% quota is in effect, may be more advantageous.
Tax Planning
Consider the annual land and building tax (0.02-0.05% for residential). For a 5 million baht condominium, this is 1,000-2,500 baht per year. Vacant properties are taxed at a higher rate-if you don't plan to rent out, arrange a minimal lease agreement with the management company.
When buying from a Thai seller, clarify who pays registration fees. By law, they are split in half, but in practice the buyer often pays. Standard fees (without benefits for foreigners):
- Transfer fee-2% of assessed value.
- Stamp duty-0.5%.
- Withholding tax-1% (paid by seller but may be passed to buyer).
Total approximately 3.5-6% of assessed value, which is usually 70-80% of market price.
Legal Support
Do not execute a transaction without an independent lawyer, even if the developer offers "free" legal support. Title due diligence includes:
- Extract from the Land Office (Nor Sor 4 / Chanot)-checking for encumbrances, arrests, legal disputes.
- Verification of the foreign quota in the condominium.
- Presence of FET bank certificate in your name (mandatory for freehold registration).
- Compliance of the sale agreement with Civil and Commercial Code requirements.
Cost of legal support-30,000-80,000 baht depending on transaction complexity. Saving at this stage can result in loss of the entire investment.
Pattaya Real Estate Market Forecast for 2026-2027
Adoption of laws on lease extension and raising the foreign quota will strengthen capital inflow into the villa and premium condominium segment. CBRE Thailand and Knight Frank analysts forecast price growth of 3-7% in 2026 subject to stable tourist activity.
Tourism is recovering: Pattaya received more than 12 million visitors in 2024, of which about 40% were foreigners with long-term stays (digital nomads, retirees, investors). Demand for long-term rental and home purchases remains high.
Infrastructure projects-expansion of U-Tapao Airport, Bangkok-Pattaya high-speed railway (commissioning expected in 2028)-increase the region's investment attractiveness. Land along planned stations in East Pattaya and Bang Saray is appreciating by 10-15% annually.
However, risks remain: global economic uncertainty, fluctuations in the baht exchange rate against the dollar and ruble, possible new restrictions on short-term rentals (short-term rentals without a license have been prohibited since 2024). Portfolio diversification-buying both a condominium for rental and a villa for personal use-reduces dependence on one segment.
Legislative changes remain a subject of discussion, but even their likelihood already affects buyer expectations and developer strategies. Those considering buying in Pattaya should monitor Royal Gazette publications and consult with lawyers specializing in transactions with foreigners.
