The 49% Quota and Purchasing a Condominium in Thailand as a Foreign National: How It Works

Why a Condominium Specifically

For a foreign national in Thailand, a condominium is the most straightforward route to becoming the outright owner of real property. As a general rule, a foreign national cannot own land, but the law makes an exception for units in registered condominiums: they may be held in full private ownership (freehold) in the name of a non-resident. This is expressly provided for under the Condominium Act B.E. 2522 (1979), as subsequently amended, with the current version being Act No. 4, B.E. 2551 (2008).

The critical condition is that the building must be legally registered as a condominium with the Land Department. Not every residential complex holds that status. A building registered as an ordinary multi-unit dwelling (apartment) without registration under the Condominium Act does not entitle a foreign national to a freehold unit, and any transaction would be structured on an entirely different basis.

What a Condominium Is Under the Law

The Act defines a condominium as a building that can be divided into individual units held in separate ownership while retaining common property shared among all owners. The law imposes no minimum height, floor area, or number of storeys - what matters is the ability to divide ownership rights.

Legally, ownership in a condominium consists of two components:

• Private ownership (unit) - the space of the unit itself, over which the owner has sole control.
• Share in common property - the land beneath the building, the foundation, load-bearing structures, staircases, lifts, corridors, the swimming pool, and car parking. This share is inseparable from the unit and passes with it on any transfer.

The size of each owner's share in the common property is fixed at the time the building is registered, through what is known as the ownership ratio - a proportion calculated, as a rule, by reference to the floor area of the unit. That ratio determines both the owner's voting weight at general meetings of co-owners and the amount of the maintenance charge payable (common area fee).

Every registered condominium is managed by a legal entity - the Condominium Juristic Person (niti bukhkhon achakhan akhan chut san) - which is responsible for maintaining the common areas and keeping the register of owners.

The Core Rule: The 49% Quota

The Act caps the aggregate share of foreign ownership in any individual building. Between 1999 and 2004, certain projects were temporarily permitted to have up to 100% foreign ownership, but that provision was subsequently repealed and the earlier limit restored.

The rule currently in force is: foreign nationals may collectively own no more than 49% of the total unit space (aggregate unit space) in any single condominium building. The remaining minimum of 51% must be owned by Thai natural persons or Thai legal entities.

Key points regarding this rule:

• The quota is calculated by floor area, not by number of units. The 49% refers to the sum of square metres, not to '49 units out of 100'.
• The quota applies to each individual building, not to a development as a whole. In a multi-tower complex, the foreign quota may be exhausted in one tower while remaining available in another.
• Once the foreign quota in a given building is fully taken up, any remaining units can only be sold to foreign nationals through alternative arrangements rather than on a freehold basis.

Foreign Quota and Thai Quota: A Comparison

If the unit in question falls within the Thai quota, it cannot be registered in freehold for a foreign national. In practice, the arrangements used in such cases are a long-term lease (leasehold, typically 30 years with an option to renew, under Section 540 of the Civil and Commercial Code - CCC s. 540) or purchase through a Thai company. Both arrangements are more complex and carry their own risks, and each warrants separate discussion.

The Funds Must Come from Abroad: FET / Tor.Tor.3

Registering a unit in freehold within the foreign quota requires more than simply making payment. The law requires documentary proof that the entire purchase price has been remitted to Thailand from abroad in foreign currency and converted into Thai baht within the country.

The document that provides that proof is the Foreign Exchange Transaction form (FET), previously known as the Tor.Tor.3 (ธ.ต.3). A bank issues this form upon receiving an inbound foreign currency transfer at or above the prescribed threshold. Without an FET, the Land Department will not register the transfer of title to a foreign national.

Practical requirements for the remittance:

• The payment reference must expressly state the purpose of the transfer (for example, 'purchase of condominium unit').
• It is advisable to name the foreign buyer (or the buyer's account in Thailand) as the recipient, so that the name on the FET matches the name of the intended registered owner.
• The total amount remitted must cover the full purchase price; it is prudent to remit a slightly larger amount to cover incidental costs.

What to Check and What to Watch Out For

• Building status. Confirm that the property is registered as a condominium under the Condominium Act and not as an ordinary apartment building. Request the registration details from the Land Department.
• Foreign quota. Before paying a deposit, obtain a current written confirmation from the developer or the management company stating that the unit falls within the foreign quota and that the 49% quota for that building has not been exhausted.
• Title and encumbrances. Verify the full title document (Chanote), the absence of any mortgages or attachments, and whether the previous owner has any outstanding common area fee arrears - such debts follow the unit.
• FET / Tor.Tor.3. Plan the overseas remittance well in advance and ensure the payment reference is correctly worded; retain all banking documentation.
• Common property and charges. Clarify the ownership ratio, the amount of the monthly maintenance charge, and whether a sinking fund is in place.
• Condominium Juristic Person. Verify that the Condominium Juristic Person is actively operating and maintaining the register of owners.
• Thai quota. If the unit falls within the Thai quota, freehold ownership is not available - assess leasehold (CCC s. 540) as an alternative from the outset.