The Thai property market is strong and backed by solid fundamentals. It’s a good time to be involved. The country benefits from strong exports and a tourism rebound. There’s a growing demand for industrial and logistics properties, thanks to the new data centers and the housing market recovery. The EEC (Eastern Economic Corridor) is a place where people from other countries want to invest, especially in technology and industry. The government is helping a foreign investor by offering incentives.
In this guide, we will share important insights that you, as a foreign investor, can consider when purchasing property in Thailand, especially if you want to invest in Koh Samui, based on the latest data and information.
Ownership Options for Foreign Investors
Wherever you choose to invest in Thailand, whether in resort areas like Koh Samui or Phuket, or in cities like Bangkok, understanding the legal framework for foreign property ownership is essential. The same restrictions for foreign ownership apply throughout the country, and ensuring compliance is a fundamental part of securing your investment.
Thailand’s legal framework restricts foreign land ownership, which directly affects how villas for sale in Koh Samui, and elsewhere in Thailand, can be purchased by international buyers.
Freehold Ownership via Thai Limited Company
Foreigners commonly use a Thai Limited Company structure to obtain freehold ownership:
- The company legally holds the land title deed (Chanote).
- Thai nationals must own at least 51% of company shares, with genuine involvement (nominee shareholders are prohibited).
- Companies must actively conduct legitimate business activities beyond merely holding property.
- Annual audits and financial statement submissions are mandatory.
- For each foreign director, at least two genuine Thai shareholders are required.
- Since regulatory enforcement tightened significantly in 2024, investors must strictly comply with these rules to avoid legal penalties.
It should be noted that in 2024, there was a high-profile crackdown by the government of Thailand on the illegal use of corporate holding structures for freehold villas by foreign investors. Consequently, it is now more crucial than ever that any company is set up and operated in full compliance with regulations.
Company holding structures are more suitable for the mid to upper end of the villa market due to the substantial setup costs, as well as government transfer fees and taxes when the asset is transferred into the company.
Leasehold Ownership
Leasehold agreements in Thailand have a maximum duration of 30 years. While developers often offer renewal options, these are not guaranteed by Thai law. To enhance security, developers frequently use “protected leasehold” structures, involving partial equity ownership in the land-owning entity.
Condominiums vs. Apartments in Thailand
In Thailand, significant differences exist between condominiums and apartments:
- Condominiums: Foreigners can directly own up to 49% of units within a condominium building under the “foreign quota,” allowing secure freehold ownership and ease of resale.
- Apartments: Typically offered on leasehold terms (30-year maximum), sometimes with renewable lease options.
For long-term investment and easier resale, condominiums generally provide better security and investment appeal.
Transaction Costs and Taxes
- Capital Gains Tax: Capital gains from property resale are taxable as income. Corporate tax applies if the property is owned by a Thai company, and personal income tax applies if individually owned.
- Rental Income Tax: Rental income generated in Thailand is taxable locally. Investors should obtain professional tax advice for compliance and potential tax treaty benefits.
- Closing Costs and Fees: Typical transaction costs include legal fees, property transfer fees (around 2% of property value), specific business tax (3.3%), and withholding tax (1% of the declared value or assessed value, whichever is higher).
Koh Samui Real Estate Market Overview (2025)
Koh Samui has evolved significantly, becoming a prime destination for luxury residential investments while retaining its unique island lifestyle.
Predominantly Villa Market
Due to zoning regulations limiting high-rise developments, Koh Samui remains largely villa-oriented, unlike condominium-heavy markets like Bangkok or Pattaya.
Limited Condominium Availability
Freehold condominiums and branded residences are rare due to strict zoning laws. Investors interested specifically in condos may find better availability in Phuket or Bangkok.
Off-Plan Investment Risks
Investors should carefully evaluate off-plan properties due to risks such as:
- Construction delays (ensure compensation clauses).
- Developer financial stability (avoid large upfront payments).
- Legal enforceability of contracts (always consult reputable legal advisors).
Prime Investment Areas in Koh Samui
Key investment areas include:
- Choeng Mon and Plai Laem: Popular for luxury villas and proximity to amenities.
- Bo Phut and Fisherman’s Village: Known for vibrant tourism and strong rental demand.
- Lamai: Offers affordable beachfront properties and growing infrastructure.
- Bang Por and Lipa Noi: Preferred for tranquil living and family-friendly environments.
Rental Market and Property Management
With strong rental demand driven by tourism, understanding local market dynamics and associated costs ensures effective and profitable property management.
Expected Rental Returns
Realistically, investors can expect net rental yields around 5–8%. Advertised returns above 10% should be verified carefully against real market performance.
Property Management Fees
Typical management fees range from 15% (on-site management) to 20–25% (third-party short-term rental management). Regular maintenance costs, including landscaping and pool upkeep, typically start around 6,000–8,000 THB monthly.
Key Takeaways for Investors
Investing in Thailand’s real estate, particularly in Koh Samui, requires thorough understanding of legal frameworks, property types, taxation, and market-specific risks. With proper due diligence and professional guidance, Koh Samui continues to offer attractive opportunities for international property investors seeking both lifestyle and financial returns.
If you’re considering buying property in Thailand, Charlesdel is an independent UK-based real estate agency specialising in international resort property, offering free expert advice and carefully selected opportunities across Koh Samui and elsewhere.
Author:
David Charles Delhanty – Founder charlesdel.com
David was borne in North London and has been managing companies marketing overseas resort property for over 20 years. His wide-ranging hands-on experience includes personally overseeing numerous complex property transactions across multiple time zones, provision of strategic investment advice to buyers and sellers and all aspects of digital marketing. With a particular focus on the Thai and Spanish resort markets, his experience dates back to 2004 when he established an estate agency in Koh Samui, Thailand. Prior to this, he worked as an IT consultant in London, specialising in the investment banking sector. Companies he worked at include Goldman Sachs, Morgan Grenfell Asset Management, DKB International, and Natwest Markets. David is committed to establishing long-term business relationships with investors based on quality of service, transparency and trust. See: https://charlesdel.com/our-company/