Licensed Condos vs Unlicensed Residential Buildings

DDproperty Editorial Team
Licensed Condos vs Unlicensed Residential Buildings
Throughout the property market in Thailand, there are licensed condos which are registered under Thailand Condominium Act., and unlicensed residential developments which are not confirmed to the property law in Thailand.
In the capital city, most condominiums that you see are licensed, while unlicensed residences could be found mostly in tourist resort areas such as Pattaya, Phuket, Hua Hin or Koh Samui. On the outside, the two types might look identical, but in terms of legal, there are significant differences that you need to comprehend before making a purchase decision.

Licensed Condos

citragarden city
  • Conformed to the law under Thailand Condominium Act.
  • Freehold owners are free to encumber, sell, or dispose of the unit
  • Co-ownership of the common areas and land that the condominium sits on
  • Democratic voting right system for condo’s management
  • Must offer minimum consumer protection
  • Owners are not subject to housing and land tax
  • Freehold condos offer Indefinite ownership period and transferable by succession

Unlicensed Residential Buildings

  • Not conformed to the law under Thailand Condominium Act.
  • Unit’s possession is under a lease contract
  • Selling is complied to the lease contrace and requires consent from the building’s owner
  • No ownership in the common areas
  • Residents are complied with rules set by the building’s owner
  • Leased properties are subject to housing and land tax
  • Leasehold residential buildings offer only fixed-period stay (maximum 30 years)
The intriguing question is how to identify whether the condominium is licensed or not. One easy way is to look at the sale agreement where it will state that the project is abided under the Condominium Act. Second, most unlicensed residences come in the form of leasehold, whereas licensed condos can be either leasehold or freehold. Finally, a licensed condo would give you an ownership title deed, while unlicensed residences could provide only a lease contract.
Though an unlicensed residence would offer a more attractive price, the property bears a much higher risk compared to licensed condominiums. Taking this information into account could help your buying decisions become more precise, or you could read DDproperty’s project reviews to gain sophisticated data about each project for deeper understanding.
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