Every foreign buyer in Thailand eventually reaches the same question: freehold or leasehold. The distinction sounds technical, but it determines whether you own property outright or hold a registered right to use it for a fixed period. The choice matters more in 2026 than it did two years ago.
In March 2025, Thailand’s Supreme Court issued a landmark ruling that voided pre-agreed lease renewal clauses in a Phuket property case. The decision effectively ended the 30+30+30 structure that developers had marketed as a 90-year ownership alternative for decades. For buyers who purchased houses, villas or land on that basis, the ruling removes the certainty they thought they had purchased.
Understanding what the ruling changed, and what it left intact, is now essential for anyone considering property in Phuket or elsewhere in Thailand.
What freehold actually means in Thailand
Freehold is full ownership in perpetuity, with the same legal rights as a Thai national. You can sell, mortgage or leave the property to heirs without time limits.
For foreign buyers, freehold is only available through the Condominium Act of 1979, and only for condominium units. Houses and land cannot be purchased freehold by foreigners, regardless of what marketing materials suggest.
Within any condominium building, foreign buyers can collectively own no more than 49% of the total saleable floor area. Once a building reaches that quota, remaining units can only be sold to Thai nationals or offered to foreigners as leasehold.
Before paying a reservation deposit, buyers should confirm in writing that freehold quota space remains available. A unit advertised as freehold is only freehold if quota capacity still exists.
What leasehold means, and where the 2025 ruling changed everything
Leasehold is a registered right to use property for a fixed term, capped at 30 years under Section 540 of Thailand’s Civil and Commercial Code. It is the standard route for foreigners buying houses, villas or land, since direct freehold land ownership is not available.
For years, developers worked around the 30-year ceiling by offering an initial 30-year lease paired with two pre-agreed 30-year renewals. This 30+30+30 structure was marketed as effectively providing 90 years of ownership, with buyers often prepaying the full term upfront.
That structure no longer holds up.
In March 2025, the Supreme Court ruled on a Phuket case, Judgment No. 4655/2566, involving exactly this arrangement. The case concerned a 30-year lease signed alongside two pre-agreed renewals, with the tenant prepaying the full 90 years of rent in a single lump sum.
The Court voided the renewal clauses, ordered the tenant to vacate, and set damages at 30,000 baht per month until they did.
The Court’s reasoning matters. The two renewal periods were priced below the original rent, which the Court treated as evidence that the arrangement existed to circumvent the 30-year cap rather than reflect genuine future negotiation. In plain English, the more a long-term lease resembles ownership in disguise, the less a Thai court will enforce it.
This does not mean every existing 30-year lease is suddenly worthless. The ruling only voided the pre-agreed renewal clauses, not the original 30-year term itself. A genuine renewal negotiated when the initial term expires remains legally possible. What is no longer reliable is any assumption that a 60-year or 90-year lease is locked in from the start.
Why houses and land cannot be bought freehold
Thai law prohibits foreigners from owning land outright. The restriction applies regardless of visa status, marriage to a Thai national, or years of residence. Houses and villas sit on land, which means direct freehold ownership of a house as a foreigner is not possible.
The available alternatives are leasehold, Thai company structures, or placing the property in a Thai spouse’s name. Each carries different legal and practical consequences, none of which replicate the simplicity of freehold ownership.
The Thai company route, and why it carries risk
Some foreign buyers attempt to acquire land by setting up a Thai limited company. Under this structure, the company owns the land, and the foreign buyer controls the company through nominee Thai shareholders who hold the majority stake on paper but have no real economic interest.
This is explicitly illegal under Thai law. Authorities have increased scrutiny of nominee structures, and the Land Department has the power to investigate company ownership and void land transfers found to be in breach. If a company is found to be using nominees, the foreign buyer can lose both the property and the money invested.
The arrangement may work for years without issue, but it remains legally vulnerable. The risk is not theoretical.
What the 2025 ruling means for Phuket property buyers
For Phuket villa and house buyers, the 2025 ruling changes the calculation in several ways.
First, the 30-year lease term is now the only guaranteed period. Buyers should not treat renewal clauses as binding, regardless of what a contract states or what a developer verbally promises.
Second, pricing should reflect this uncertainty. A leasehold villa marketed with 90 years of tenure no longer carries that assurance. Buyers should assess value based on the registered 30-year term, not on the possibility of future renewals.
Third, resale becomes more difficult. A leasehold property with 20 years remaining and no enforceable renewal is harder to sell than the same property was in 2024, when buyers believed they were purchasing 90 years of security.
For buyers who already hold 30+30+30 leases, the situation is uncertain. The ruling does not automatically void existing agreements, but it removes confidence that renewal clauses will be enforceable if challenged. Whether a landlord or their heirs choose to honour those clauses remains at their discretion.
Which ownership structure should you choose?
For condominium buyers, freehold remains the clearer option where available. It provides indefinite ownership, easier financing, simpler inheritance and stronger resale appeal. The only constraint is quota availability.
For villa and house buyers, the choice is more difficult. Leasehold remains the most straightforward legal route, but the 2025 ruling means buyers must accept that only the initial 30-year term is guaranteed. Buyers planning to hold property for longer should factor in the possibility that renewal may be negotiated on less favourable terms, or not at all.
Thai company structures carry legal risk. Buyers considering this route should understand that the arrangement is not legally sound, regardless of how common it may appear in practice.
The safest approach for foreign buyers is to purchase within the structures that Thai law clearly permits: freehold condos where quota allows, or registered leasehold for houses and land, with realistic expectations about the 30-year limit.
Frequently Asked Questions
Does the 2025 ruling affect existing leasehold contracts?
The ruling does not automatically void existing leasehold agreements, but it removes confidence that pre-agreed renewal clauses will be enforceable if challenged. The original 30-year term remains valid. Whether landlords or their heirs choose to honour renewal clauses is now uncertain.
Can foreigners own villas freehold in Phuket?
No. Foreigners cannot own land freehold in Thailand, and villas sit on land. The available legal options are leasehold, Thai company structures (which carry legal risk), or placing the property in a Thai national’s name. Freehold ownership for foreigners is only available for condominium units within the 49% foreign quota.
What happens after a 30-year lease expires?
The property reverts to the landlord unless a new lease is negotiated. Pre-agreed renewal clauses are no longer reliable following the 2025 Supreme Court ruling. Renewal terms, if any, will be negotiated at the time the lease expires, based on market conditions and the landlord’s willingness.
Is leasehold still worth considering for Phuket property?
Yes, but buyers should price and plan based on the registered 30-year term only. Leasehold remains the clearest legal route for foreigners buying houses or land in Thailand. The 2025 ruling simply removed the false certainty that 90-year leases were guaranteed from day one.
Can I finance a leasehold property in Thailand?
Financing leasehold property is more difficult than financing freehold. A small number of Thai banks may consider leasehold mortgages, but terms are typically less favourable. Most foreign buyers of leasehold properties pay cash.
Sources
- Thaiger — Freehold or leasehold, the choice that decides how you own property in Thailand — link
