The government continues to look for new ways to attract foreign direct investment and stimulate the sluggish property market and now Thailand’s Finance Ministry is considering allowing foreigners to lease land in Thailand for up to 50 years, reports local media. International buyers can currently lease land for residential purposes in Thailand for up to 30 years.
While nothing has been agreed upon yet, the government is considering amending the current law which limits land leases to foreigners. The new law would allow for leasehold real estate contracts to run for a maximum of 50 years and also allow for the rights to be transferable with the land being returned to the Thai owner upon expiration of the lease, tells Finance Minister Apisak Tantivorawong to the Bangkok Post.
The goal of the new legislation is to create another property market boom similar to what Thailand had prior to the 1997 Asian financial crisis, says Apisak. If the new law is approved by the government, foreign demand will be the driving force behind the real estate recovery in the country.
With the real estate sector playing an important role in the country’s economy, which continues to stagnate, the government is trying to find ways to help its recovery. With property being connected to other economic sectors, such as building and raw materials, decoration, electric appliances and banks, an improvement in real estate market would positively impact other areas of Thailand’s economy.
However, the new laws regarding foreign land leases will need to be studied thoroughly before being approved. The longer time period for leases should assist landlords who aren’t keen on selling their land, but there are some examples of land types that shouldn’t be included in the new laws, according to experts.
“It would be good for the industry and the country. But the government should determine the scope or purpose of land use for leasing to prevent any effect on the country’s security. For example, a foreigner leasing a rice field of 100,000 rai should not be allowed,” says Prasert Taedullayasatit, President of the Thai Condominium Association.
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