Thailand Tightens Checks on Foreign Villa Deals

Foreign buyers are taking longer to commit to villas in Phuket, Koh Samui and Koh Phangan after Thailand expanded investigations into companies using Thai nominee shareholders. The ownership rules have not fundamentally changed: authorities are enforcing existing restrictions more aggressively and examining corporate records, sources of capital and effective control. Landed villas face the greatest exposure, while lawful foreign purchases of condominium units continue.

Villa Buyers Are Delaying Decisions

Property agents in Thailand’s largest resort markets are reporting longer decision periods among international clients.

Buyers are requesting additional legal opinions, examining land ownership more closely and avoiding structures in which a Thai company holds the plot through an apparently local majority.

The slowdown is most visible in Phuket and Koh Samui, where foreign capital represents a large part of demand for resort villas.

Reports carried by the Bangkok Post and South China Morning Post indicate that some prospective buyers are postponing rather than permanently abandoning purchases while they verify whether the proposed ownership structure complies with Thai law.

The change is not the result of a new general property ban. Thailand has long restricted direct land ownership by foreign nationals. What changed in 2026 is the scale and coordination of enforcement against companies allegedly established to circumvent those restrictions.

AsiaNews reported that the crackdown has not yet frozen the luxury-property market. Transactions continue, but the legal structure has become as important to buyers as the location, price and potential rental return.

Authorities Are Analysing More Than 11,000 Companies

Thailand’s Department of Business Development and Department of Special Investigation have begun a systematic examination of companies registered on Koh Samui and Koh Phangan.

The official dataset contains 11,426 companies. Authorities are classifying them by risk level and comparing shareholder, director, capital, tax and operating information.

Foreign participation does not itself indicate illegal activity. Investigators are attempting to determine whether Thai shareholders are genuine investors and whether they can demonstrate the origin of their capital.

A total of 16,811 companies are registered across the two islands. Foreign investors hold interests in 11,426 of them, equivalent to approximately 68% of all registered firms.

The group contains both lawful businesses and entities suspected of using local proxies.

Risk indicators include one Thai individual holding shares in dozens of unrelated companies, shareholders lacking sufficient declared income to make their investments, money being provided by a foreigner immediately before registration and foreign investors exercising all effective management control.

One inspection identified an individual listed as a shareholder in 87 companies. Connections of this kind can reveal networks providing nominees for several property, hospitality and tourism businesses at the same time.

Raids Expanded to Phuket, Krabi and Phang Nga

Police launched the third phase of an enforcement operation in Phuket, Krabi and Phang Nga in June 2026.

More than 500 officers and government officials participated. Authorities reported 48 arrests involving Thai and foreign suspects and the seizure of assets worth more than 1 billion baht.

The operation covered property, tourism, hotels, vehicle rentals and other businesses in which Thai proxies may have been used to conceal foreign ownership or control.

The raids do not mean every villa purchased through a Thai company will be confiscated. Investigators must establish who provided the capital, who receives the income, who makes decisions and whether the Thai shareholders perform a genuine commercial role.

By early 2026, authorities had prosecuted more than 850 companies in a wider campaign involving nominee structures and related financial offences. Estimated economic damage, including lost government revenue, exceeded 15 billion baht.

Those figures cover several types of business and should not be interpreted as referring exclusively to foreign villa ownership.

How Nominee Ownership Works

A nominee shareholder is a person who formally holds company shares but does not invest their own funds, participate meaningfully in management or act independently from the true foreign owner.

A company may show Thai citizens owning 51% of the shares and a foreign investor holding 49%. The economic reality can be reversed if the foreigner provides all the capital, appoints managers, receives the profits and controls the property.

The share percentages alone do not make the arrangement lawful. The origin of the capital and the actual allocation of authority are critical.

Foreign control concealed behind nominal Thai shareholders may violate the Foreign Business Act and Thailand’s land restrictions.

Government guidance warns that participation can result in criminal proceedings, fines, seizure of assets and orders to terminate the unlawful activity. Liability can extend to both the foreign investor and the Thai nominees.

Villas Face Greater Exposure Than Condominiums

A unit in a registered condominium and a villa built on its own plot have different legal characteristics.

A foreigner can register a condominium unit in their own name, provided that aggregate foreign ownership does not exceed 49% of the building’s total unit area.

The purchaser must also provide the required evidence of qualifying funds, generally transferred into Thailand from overseas.

A villa transaction usually involves two assets: the building and the underlying land. The main legal difficulty concerns the plot, as foreign nationals generally cannot register Thai land in their own names.

A narrow exception exists for individuals investing at least 40 million baht in qualifying assets. With approval from the interior minister, an investor may acquire up to one rai, or 1,600 square metres, solely for residential use.

The process is rarely used and is not the normal route for purchasing a resort villa.

Companies promoted by the Thailand Board of Investment may obtain land rights for approved commercial projects. Those privileges are linked to the promoted activity and do not provide a general ownership route for an individual buying a holiday home.

Lawful Structures Remain Available

A registered land lease is one of the standard alternatives.

Thailand’s Civil and Commercial Code limits a lease of immovable property to 30 years. An agreement longer than three years must be registered, or it is enforceable for only the first three years.

A further term can be created later, but it is a renewal rather than an automatically registered 60-year or 90-year property right.

Marketing promises describing guaranteed “30 plus 30 plus 30” arrangements should therefore not be treated as equivalent to a single 90-year registered lease.

Another approach separates the rights to the building from the rights to the land. A foreigner can lease the plot and register an interest in the structure through instruments recognised under civil law.

These arrangements can be lawful but do not provide the same control as freehold land ownership. Their value depends on registration, inheritance rules, transferability and termination provisions.

Resort Markets Depend Heavily on International Demand

Thailand does not publish a comprehensive national database identifying the nationality of villa purchasers.

Transactions can be structured as leases, building transfers, corporate holdings or developer agreements and therefore do not appear in one consistent registry.

Juwai IQI estimates that approximately three in five Phuket villa transactions involve a foreign buyer or lessee. In selected segments of Koh Samui and Koh Phangan, foreigners may account for more than 90% of villa demand.

These are industry estimates rather than official Land Department statistics.

The group estimates that between 2,400 and 3,000 Phuket villas are ultimately controlled or leased by foreign nationals. The precise number is uncertain because ownership, tenancy and effective economic control are different concepts.

The high proportion of international demand explains why enforcement changes quickly affect sales periods. Even a temporary pause by foreign clients can weaken developer cash flow, particularly in projects offering large villas to a narrow local audience.

Foreign Demand Has Not Disappeared

Market participants have not reported a wholesale withdrawal from Thailand.

Phuket, Koh Samui and other resort areas continue to attract buyers because of tourism, international schools, private healthcare, climate and an established rental market.

Juwai IQI argues that enforcement may ultimately strengthen confidence if it produces more transparent transactions. International investors tend to prefer markets where rights are clearly defined and non-compliant offerings are removed.

The short-term effect is more disruptive. Additional checks increase transaction time, legal costs and documentary requirements.

Some clients may choose condominium units instead of villas. Others may prefer projects in which a reputable Thai developer retains the land and grants registered leases to purchasers.

Capital could also move to Malaysia, Indonesia, Vietnam or the United Arab Emirates when buyers consider the Thai structure too complicated.

Thailand must therefore remove sham companies while preserving predictable lawful routes for foreign investors to use property over the long term.

Condominium Demand Remains Resilient

Registered condominium transfers provide a clearer measure of the lawful foreign market.

International buyers completed transfers of 14,899 condominium units in Thailand during 2025. Unit numbers increased by 2.2%, while the total value fell by 10.7% to 60.92 billion baht.

Foreigners represented 14.7% of all condominium transfers by unit and approximately 25% by value.

Chinese nationals remained the largest group, acquiring 4,940 units worth about 18.5 billion baht. Their unit total declined by 12.9%, while value fell by 30%.

China nevertheless remained the largest foreign market by both measures.

The figures show that overseas interest in Thai property persists, although buyers have become more price-sensitive and cautious.

The nominee-company crackdown should have less effect on condominium units purchased within the legal foreign quota. The main exposure lies in landed developments and projects where corporate ownership was substituted for a properly registered lease.

Developers Will Need to Restructure Sales

Resort developers are likely to offer more projects in which the building is transferred to the foreign buyer while the underlying land is provided through a registered lease.

Another possibility is the development of registered condominium projects containing low-rise apartments or villa-style units, provided they meet the statutory requirements.

This model can permit direct foreign ownership of part of the saleable area but requires different planning, title and common-property arrangements.

Developers will also be expected to disclose more information about the landowner, shareholders, financing and construction approvals.

Buyers will increasingly demand an independent legal opinion before paying a substantial reservation deposit.

Small projects that relied on standard company packages with pre-arranged Thai shareholders face the greatest disruption. Larger developers with transparent capital and secure title may gain a competitive advantage.

Liquidity May Fall Before Prices Do

Stricter enforcement does not necessarily cause immediate reductions in advertised villa prices.

Owners of expensive resort properties often have limited mortgage debt and can wait for a suitable buyer. Lower transaction volume and longer marketing periods are therefore likely to appear before headline price cuts.

Private discounts may increase without being reflected in listings.

Developments financed through advance sales are more vulnerable. The delay of several major purchases can affect construction cash flow and encourage developers to offer instalment plans, furniture packages, rental-management guarantees or informal price reductions.

Properties with a clear title history, an identifiable landowner and a registered lease may retain demand.

The market is likely to become more divided by the quality of its legal documentation rather than by location alone.

Buyers Must Examine the Entire Chain of Rights

Due diligence should begin with the land title. Buyers need to confirm the registered owner, plot boundaries, mortgages, servitudes, court restrictions and access to a public road.

Where a company is involved, the review should identify beneficial owners, the source of the Thai shareholders’ funds and the real distribution of voting power.

A formal 49% foreign shareholding does not protect an investor when other documents show that the Thai majority exists only on paper.

Lease contracts should be checked for registration, remaining term, inheritance and transfer provisions, rental restrictions and termination rights.

Construction permission, compliance with approved plans and licensing for short-term tourist accommodation also require separate review. The right to occupy a villa does not automatically permit its operation as an unlicensed hotel.

Legal advisers should be independent of the seller, broker and developer. A firm that created the vendor’s structure may have a conflict when assessing its risks for the buyer.

Enforcement Will Reshape Rather Than Close the Market

Thailand benefits from foreign investment, particularly in tourism-dependent provinces. It also wants to prevent land control through sham companies and unlicensed businesses.

Removing all foreign demand would damage construction, tourism services and tax revenue. The more likely result is a shift towards condominiums, registered leases and projects with transparent ownership structures.

Transactions will take longer and legal review will cost more. For a compliant buyer, those expenses can reduce the risk of a later dispute or loss of the asset.

As International Investment experts report, the campaign does not create a new ban on foreign real estate. It targets a longstanding grey-market structure involving nominal Thai shareholders. Villas are most exposed when control of the land depends on a company without genuine local investors. Foreign demand should remain because Phuket and Koh Samui retain strong lifestyle and tourism appeal, but capital will move towards properties with clear registration, independent due diligence and lawful land-use rights. In the near term, the principal effect is likely to be lower liquidity and longer sales periods rather than an equal decline in the price of every resort villa.

FAQ

Can foreigners own land in Thailand?

Generally, no. A narrow exception requires at least 40 million baht of qualifying investment, ministerial approval and limits the residential plot to one rai.

Can a foreigner own a villa?

A foreigner may own or hold rights to the building, while the underlying land usually requires a separate lawful arrangement such as a registered lease.

What is a Thai nominee shareholder?

It is a Thai person who is formally registered as an investor but contributes no genuine capital and acts on behalf of the effective foreign owner.

Is a company with 49% foreign ownership legal?

It can be, provided the Thai shareholders are genuine investors and participate in the business. A 49% foreign share does not automatically make the arrangement compliant.

Did the ownership rules change in 2026?

The basic restrictions remained in place. Authorities increased inspections and data sharing between corporate, police, tax and land agencies.

Can foreigners buy condominium units?

Yes. Foreigners may hold units in a registered condominium when total foreign ownership remains within 49% of the building’s unit area.

What is the maximum land-lease period?

A single registered lease of immovable property is limited to 30 years. Future renewals do not automatically create a registered 60-year or 90-year right.

Will demand fall in Phuket and Koh Samui?

Some buyers are delaying decisions, but there is no evidence of a mass withdrawal. Demand is likely to shift towards legally transparent properties.

Can the authorities seize a villa?

Seizure or a forced disposal may follow a proven legal violation. Foreign residence or a valid registered lease alone does not justify confiscation.

What should a buyer check?

The land title, company ownership, shareholder funding, lease registration, construction permit, mortgages, road access and licensing for tourist rentals should all be independently reviewed.