Rental Agreements in Thailand

Rental Agreements in Thailand

If you are retired in Thailand or married to a Thai then more likely than not you would be renting property like most expats. Very few buy property in Thailand on their first visit and normally rent before they buy the property they live in. This makes sense as it gives you an idea of the area in which you live.

Rental Agreements in ThailandThe rental agreements are mostly short term being month to month or 6 months maximum but longer agreements for large properties are common and needs to be registered against the property at the land department when the rental is longer than 3 years normally. The rental agreements are not covered by the Condominium Act but by the Civil and Commercial Code which covered Hiring Property. The maximum rental agreement allowed in Thailand is 30 years. There has been much talk about a 99 year lease agreement but the law has not change in this regard. Remember that a lease is not like ownership and when you die or you breach the agreement the lease will come to an end.

Voting rights

When you lease property you do not get any voting rights in the condominium block as the owner retains this right. When there is an annual general meeting you do not need to attend the meeting as you have no rights other than that which is in the lease agreement and voting rights are excluded from the lease agreement. This is normally never a problem in Thailand.

Selling your Lease

You do not have the right to sub-lease the property. The owner of the property is the only person with the right to lease the property. Most lease agreements in Thailand prohibit sub-leasing the property. Section 544 of the CCC law in Thailand covers this by stating that sub-letting is not allowed unless it has been allowed within the lease agreement.

Inheritance of a leasehold

This is not allowed. Once you die then so does the lease agreement. You can however add in a succession clause in to the lease agreement so that if you die your Thai wife can still continue living in the property until the lease is complete. Again this is not common in lease agreements in Thailand and needs to be added if the owner of the property agrees to such a clause.

Term of the lease

The terms of the agreement can be a maximum of 30 years. If it is for longer than this then it will not be enforceable in Thailand as Thai law prohibit lease agreements longer than 30 years. You can have a back-to-back agreement of 30 X 30 years but that is about the length which you can stretch the law too in Thailand.

Rental Tax

This is normally never discussed but it may become an issue in a high end property. Thailand does have a rental tax and a percentage of this tax needs to be paid to the government each year. Speak to the owner as to who is responsible for the rental taxes on the property.

If you are going to lease property in Thailand then speak to a property attorney in Bangkok first. Speak to us online on our main website or walk into any of our offices in Thailand which has been listed here.