# Freehold vs leasehold property in Thailand — what's the difference and which to choose

> Freehold vs leasehold in Thailand: how each one works, what the Supreme Court now says about lease renewals, and which structure fits you.

In Thailand, "freehold" and "leasehold" are not market labels — they are distinct legal instruments registered separately at the Land Office, with different rights, different terms, and different exit options. For foreign buyers, the choice between them is partly a preference and partly forced: freehold land is closed to foreigners by the Land Code, so leasehold becomes the default for villa purchases. For condominiums, both options exist and the choice has real implications.

This article unpacks both, compares them on the dimensions that matter for foreign buyers in Phuket, and explains what Supreme Court Decision No. 4655/2566 means for leasehold buyers.

## What does freehold ownership mean in Thailand?

Freehold means you hold the title deed, with the Land Office register showing your name as owner. The right is perpetual, transferable by sale or gift, inheritable, mortgageable, and not contingent on any other party.

For foreigners, freehold is available for **condominium units only**, registered under the [[foreign-property-ownership-thailand|Condominium Act 1979]]. Two conditions must be satisfied:

- The condominium project must have foreign-quota capacity. Section 19 caps total foreign-owned saleable floor area at 49% of the project. If the building is at quota, no new freehold registrations are possible until a foreign-owned unit is sold to a Thai or restructured to leasehold.
- Purchase funds must enter Thailand from abroad in foreign currency, evidenced by a [[fet-form-foreign-exchange-transaction|Foreign Exchange Transaction]] (FET) form from the receiving Thai bank.

Freehold land is closed to foreign individuals under the Land Code, with three narrow exceptions: Section 96 bis (THB 40M investment-based, rare), Board of Investment (BOI)–promoted business land, and inheritance (with one-year disposal requirement). None is a normal route for residential buyers.

## What does a Thai leasehold give you?

Leasehold is a registered tenancy right, capped at 30 years, under Section 540 of the Civil and Commercial Code. The owner of the property remains the freehold title-holder; the lessee gains the right to use and occupy it for the term. Under Section 544, subletting and assignment require permission in the lease; under Section 558, alterations and additions require the lessor's permission.

The 30-year cap is statutory — clauses extending a single lease beyond 30 years are void as a matter of law, not a matter of negotiation. At the end of the term, the property reverts to the owner unless a fresh lease is registered.

Leasehold is the typical structure for foreign buyers acquiring villas or houses on land in Phuket. It also exists as an alternative for condominium units when the freehold quota is full or the buyer prefers a leasehold structure (sometimes for inheritance or tax reasons).

### Are 30+30+30 leases still enforceable after Decision 4655/2566?

A single registered 30-year lease is enforceable as written; what the Supreme Court voided was a specific prepaid renewal package, not standard leasehold itself.

For three decades, the Phuket villa market sold "30+30+30" structures — a 30-year lease with two pre-agreed renewals written into the contract, marketed as "90-year secure tenure" or, with a buffer, "99-year leasehold." Decision No. 4655/2566 concerned a registered 30-year lease and two further 30-year promises made on the same day, with rent for the future 60 years prepaid and no new terms left to negotiate. The Court treated that package as an attempt to evade Section 540 and held the future-term arrangement void. The published record does not state an 18 March 2025 judgment date, and the holding should not be expanded into a categorical rule about every differently drafted future promise.

Do not assign present value to a promised renewal without Thai counsel reviewing its exact drafting and facts — a later term still requires the then-owner's cooperation, a new agreement, and registration. Marketing copy that promises "90 years" or "99 years" of tenure under a single registered lease is misleading; treat the practical horizon as 30 years.

Detailed mechanics of registration, renewal procedure, and what to negotiate in a leasehold contract: [[leasehold-30-year-renewable]].

## Can a foreigner own the house but lease the land in Thailand?

Yes — by pairing a land lease with a registered superficies on the building. The land itself cannot be freehold for a foreigner, but Section 1410–1416 lets a separate owner hold the building on someone else's land, with full transferable, inheritable rights over the structure independent of the land title.

The standard Phuket villa pattern registers both at the same Land Office closing: a 30-year lease secures occupancy of the land, and the superficies gives the buyer separate, sellable ownership of the house itself. Without the superficies, the house is legally part of the land under default Thai property rules, and it goes with the lease when the lease ends or is assigned. Full mechanics, term options, and the tax treatment of stacking a superficies with a usufruct: [[usufruct-superficies-habitation]].

## What's the difference between freehold and leasehold in Thailand?

Freehold gives perpetual title in your name with no renewal risk; leasehold caps the term at 30 years and carries a smaller registration cost but a weaker resale and inheritance position. The table below compares both across the dimensions that matter for a foreign buyer.

| Dimension | Freehold (foreign-owned condo) | Leasehold (land or condo unit) |
|-----------|-------------------------------|-------------------------------|
| Term | Perpetual | Up to 30 years |
| Title in Land Office | Your name on the title deed | Owner's name; lease registered on back of deed |
| Transferability | Sell freely; new owner gets new title | Assign the lease; lessor may have consent rights per contract |
| Inheritance | Pass by will or intestate | Do not assume succession; it depends on the lease wording, structure, facts and applicable law |
| Renewal | N/A (perpetual) | Requires a new agreement and registration; forward promises need case-specific review |
| Resale market | Strong — foreign buyers pay premium for freehold condos | Weaker — secondary lease has fewer years left and limited buyer pool |
| Mortgageability (foreigner) | Possible via select foreign banks | Very difficult |
| Initial cost (registration) | 2% transfer fee + other taxes | 1% lease registration fee + 0.1% stamp duty |
| Annual costs | Land & Building Tax, common area maintenance, sinking fund | Land & Building Tax (typically owner pays), common area maintenance, sinking fund |
| Foreign quota constraint | Yes — 49% cap | No — leasehold doesn't count toward the 49% |
| Available for land? | No (condo only for foreigners) | Yes |
| Available for villas? | No | Yes |
| Risk at end of term | None | Property reverts to lessor unless renegotiated |

## Freehold vs leasehold — which should you choose?

The choice is constrained more than it is open, and it splits by property type.

**For a condo, choose freehold if available.** The premium you pay over leasehold is recovered on resale because the buyer pool for freehold condos is much larger and the asset is genuinely yours forever. Only choose leasehold for a condo if the freehold quota is full and you don't want to wait, or if there's a tax-planning reason specific to your situation.

**For a villa or house on land, leasehold plus superficies is the practical structure** — see above for how the two rights combine. The land cannot be freehold for a foreigner, so this pairing is the closest legal equivalent to ownership, at the cost of two registrations and two stamp duties instead of one.

**Avoid Thai-company-holds-land for personal residences.** The structure is legally permitted only with genuine Thai shareholders. The 2024–2025 enforcement wave (Department of Special Investigation, Department of Business Development, Revenue Department) makes nominee structures actively risky — fines, forced dissolution, and sale orders are now real outcomes. Detail in [[thai-company-property-ownership]].

## Is leasehold a good fit for you as a foreign buyer?

For most foreign buyers, a leasehold villa is a good fit because their real ownership horizon is inside 30 years anyway; for a buyer who specifically needs multi-generational land tenure, leasehold — and Thailand generally — might not be the right fit.

A foreigner who buys a leasehold villa at age 50 in 2026 has clear tenure to 2056. By 2056 the buyer is 80, the property is 30 years older, the area has changed, the family situation has changed. In most cases the buyer would be selling, downsizing, or no longer using the property anyway. The "I want freehold so my grandchildren [[inheritance-thai-property-foreigners|inherit it]]" argument is real for some, but for most foreign buyers in Thailand, a 30-year horizon matches their actual ownership intent.

The honest framing is: leasehold gives you secure, exclusive, contractual use of a Thai property for up to 30 years, in a country where freehold land is closed to you anyway. If that matches your timeline, leasehold is fine. If you genuinely need multi-generational land tenure, Thailand might not be the right country to buy in, and no contract structure will fix that.

## What does it cost to register freehold vs leasehold?

Leasehold is cheaper to register than freehold — for a 10M THB condo, expect roughly 100,000–200,000 THB in typical buyer-side fees for freehold against roughly 110,000 THB for leasehold, using the official rates below.

For a 10M THB condo:

| Tax/fee | Freehold | Leasehold (30 years) |
|---------|----------|----------------------|
| Transfer fee | 2% × 10M = 200,000 | N/A |
| Lease registration fee | N/A | 1% × 10M = 100,000 |
| Stamp duty | 0.5% × 10M = 50,000 (if SBT not applicable) | 0.1% × 10M = 10,000 |
| SBT (if seller <5 years) | 3.3% × 10M = 330,000 | N/A |
| Withholding tax | Variable | N/A |
| **Buyer's typical share** | ~100,000–200,000 (transfer fee, often split) | ~110,000 (full) |

Resale costs are also lower for leasehold. But the asset itself is worth less because of the finite term, so total cost of ownership over a long hold favors freehold for assets you intend to keep or pass on.

Full breakdown of who pays what, including SBT and stamp duty rules: [[taxes-buying-property-thailand]].

## Links

- [Current Civil and Commercial Code — Office of the Council of State](https://searchlaw.ocs.go.th/council-of-state/#/public/doc/Qko1NGNVa1FhMG9hTTNGcU9sTGxydz09)
- [Civil and Commercial Code Section 540 (lease cap)](https://www.thailandlawonline.com/civil-code/civil-and-commercial-code-section-540)
- [Condominium Act B.E. 2522 (English translation)](https://www.thailandlawonline.com/translations/condominium-law-thai-condo-act)
- [Supreme Court database — search Decision No. 4655/2566](https://deka.supremecourt.or.th/search)