What Is the Difference Between Freehold  and Leasehold?

Freehold: The buyer becomes the registered owner of the condominium unit after the transfer is legally registered.  Ownership is not limited to a standard 30-year lease term.  However, foreign buyers must meet the applicable legal requirements, including the foreign ownership quota for condominiums in Thailand.

Leasehold: The buyer receives contractual rights to use the property for an agreed period.  A registered lease of immovable property is generally limited to 30 years per term under Thai law.

A leasehold interest is not the same as freehold ownership.  Leases exceeding three years generally need to be registered to be enforceable beyond three years.  Renewal is not automatically guaranteed, so buyers should carefully review the lease agreement, renewal provisions and transfer conditions before signing.

Key Considerations Before Choosing

Freehold ownership may be suitable for buyers who want long-term ownership and the ability to sell or transfer their unit, subject to applicable law.  Leasehold may be an option for buyers who prioritise the right to use a property for a defined period rather than obtaining registered ownership.

For example, a buyer planning to keep a condominium for many years may compare the long-term benefits of freehold ownership wiht the initial cost and remaining lease term of a leasehold arrangement.  Buyers should also consider whether they intend to resell, rent out or pass on their interest in the property.

Before entering into a leasehold agreement, buyers should check the remaining lease period, the conditions for transferring the lease, and any renewal provisions.  They should not assume that a promise to renew automatically guarantees another 30-year term.  Independent legal advice can help clarify the rights and obligations under the agreement.