Phuket Land – Buying and Selling Guide

Properties with sea view are more expensive

Foreigners are not permitted to own land in Thailand, so it’s best to thoroughly check your options and consider them carefully before deciding to invest money in Phuket. You can buy land by putting it in a Thai partner’s name, such as your spouse, but you do risk a bad situation if your partner dies or the relationship goes awry – especially when the law requires that you, the foreigner, must sign an affidavit that the money is your partner’s to begin with.

Some people will tell you that it is possible to form a Thai company in which you are a 49 per cent shareholder. This is a difficult and risky option, leaving you potentially at the mercy of the 51 per cent Thai shareholders. Many agencies will set up a Thai company for you, for a fee, but some of these companies do swindle people out of their money and, essentially, you are still not the lawful owner, despite the ceding agreements between partners.

In addition, the law has been tightened in recent years specifically to stop foreigners controlling land through Thai companies. Having nominee shareholders is now illegal (Thai shareholders may be examined to see whether they are financially capable of buying the shares they have) and all companies must provide audited accounts every year. If a company shows a loss four years in a row the authorities may deregister it. It can be a tedious process trying to ensure a ‘profit’.

However, if you have made the decision to buy land in Phuket, there are many ways to set about finding the right plot. First of all, you should decide where you want the land and what you will do with it. Almost all the beachfront land on the west coast of the island (with the exception of Mai Khao Beach) has been bought and developed, and any parcels that have not are so outrageously priced that even high-end developers are giving them a miss. Currently, the east coast of Phuket is attracting investment and prices there are rising, though there are plenty of attractive land parcels that have not yet been snapped up.

Much of the east coast is bordered by mangrove forests and there are only a few scattered beaches. However, this coast opens onto the sheltered Phang Nga Bay and many would also say that a view of the karst islands of Phang Nga is far more interesting than the flat horizon of the west coast. Phang Nga Bay also offers year-round sailing, which the west coast cannot. For this reason, all the marinas on the island are located on the east coast. While the area is not as busy with nightlife glitz and souvenir shopping as the west coast is, it is closer to supermarkets and the island’s main hospitals.

The centre is quite mountainous; making it more difficult to build on, so not much land is for sale there. That said, some developers have been taking advantage of the spectacular views offered from the tops of these green hills. Land further from the sea is naturally cheaper as well. Note! In Phuket, no structure may be built with a rooftop more than 80m above mean sea level.

The Laguna area, which now houses the famous Laguna resort complex, was worthless land ruined by tin mining. It’s now one of the most expensive areas in which to live, which goes to show that no matter where you buy on Phuket, land prices will inevitably rise. As a wise property man noted; ‘They’re not making any more land!’

Phuket province includes many small islands, such as Koh Maphrao, Koh Yao Noi and Koh Yao Yai, Koh Racha and Koh Naka. Occasionally, land on these islands is for sale, and sometimes entire islands emerge on the market. Unfortunately, the infrastructure leaves a lot to be desired and you’ll have to think about the added cost of bringing in your own electricity and ferrying over building materials. However, there is still good beachfront land at reasonable prices to be had on some of the islands.

At the moment, the cheapest land for sale in Phuket is around the centre of the island, from the bottom up, away from sea views. These areas are start at around 1 million baht (~US$33,000) per rai (which is 400 wa or 1600m², 0.42 of an acre), but you’ll be quite lucky to find anything really good for that price. More realistic for a decent rai of land is 3 million baht (~US$100,000) in the Rawai or Chalong areas. Think 20 million upwards for beach view land on the west coast and much more for actual beachfront land.

Thailand is gradually moving towards a system where land will have one type of deed, but until then there is a variety of papers that confer squatting rights and land use rights, yet only one type of paper that confers incontestable freehold ownership, the Chanote. Even these titles must be carefully researched to ensure there is a paper trail that shows upgrades leading to Chanote status. The other two are Sor Gor Neung (an older title deed based on historical demarcations and not geography) and Nor Sor Sarm (the historic claim to ownership of land through occupation, not officially concluded). A good local law firm should be employed to do this as ordinary citizens are not given access to the paperwork.

Essential information
Thailand is gradually moving towards a system where land will have one type of deed, but until that is completed there is a variety of papers that confer squatting rights and land use rights but only one type of paper that confers incontestable freehold ownership: the Chanote, as it’s called. Even these titles must be carefully researched, to ensure there is a paper trail that shows upgrades leading to Chanote status. The other two are Sor Gor Neung (an older title deed based on historical demarcations and not geography) and Nor Sor Sarm (the historic claim to ownership of land through occupation, not officially concluded). A good local law firm should be employed to do this – ordinary citizens are not given access to the paperwork.

When looking for land in the hills, beware of plots with Sor Por Kor papers. This confers only squatters’ rights for farming, a government initiative to make unused government land available to the poor. These rights may be willed to an heir but may not be sold or leased.

With prices on the west coast out of sight and east coast prices rising, many local developers have been looking just north of Phuket to Phang Nga Bay for cheaper land prices. There, some of the beachfront land has already been developed with high-end properties, but it is still possible to find land for less than a million baht a rai, and a lot of beachfront land (which will cost more) is still undeveloped. Phuket is overflowing with estate agents who will be happy to help you find just the right parcel of land.

Further reading…