FAQs

Why invest in Koh Samui?

Koh Samui is, today, a truly international destination with visitors and investors from around the world. The British and Hong Kong expats represent the largest number of property buyers. However, Nordic nationals plus an increasing numbers of Russians and Hungarians are also investing. The number of older more affluent visitors coming to Samui is also increasing rapidly. The island now boasts top class hotels, resorts, restaurants, an 18 hole championship golf, and has developed into an truly up-market holiday destination. The number of visitors from Asian countries is also increasing due to improved air links. You can already fly direct to Samui from Hong Kong, Singapore and Kuala Lumpur. This transformation into an up-market, international holiday destination is reflected in the real estate market where prices have risen dramatically, and at increasing rate, over the last few years.

The island is also unusual in that it offers the amenities of a developed destination, yet still retains the feel of a romantic tropical island, unlike Phuket, which is linked to the mainland by bridge. Samui provides luxury, modern living in a romantic island setting. Various laws also exist in Koh Samui which have had a very positive effect on constraining over development. For example, buildings cannot generally exceed 12 meters in hight, which has saved the island from a high rise skyline, again, unlike Phuket.

The island has also been given special development status by the Thai government, which will lead to more investment in infrastructure. Better infrastructure, such as schools, hospitals and transport links, along with along with leisure facilities, such as golf courses and cinemas, make this a viable and appealing place to live semi-permanently. This is reflected in the increasing number of expatriates, generally affluent in nature, which has a very positive impact on property prices.

From an investment standpoint, Samui also remains fairly cheap compared to the likes of Spain and Portugal – traditionally the most popular place for European buyers. This value is even more apparent when you compare Samui to Hong Kong and Singapore, where land is especially expensive.

One of the main driving factors behind the islands property market is its value, compared to other holiday destinations, combined with the potential from rental income. It is estimated that on Samui, investors can be looking at yields 8-10% per year, whereas many other alternative destinations offer 4-6%, mainly due to rapid price increases.

The fact that Samui is now an international destination also means that the property prices are less vulnerable to slumps in any single market. For example, unlike Bangkok, would be largely unimpacted by a downturn in Thai house prices, unless it affected international buyers.

In all these ways, Samui has a great deal going for it just in terms of financial fundamentals while a maturing market means that property investing here no longer involves the same level of risk as a few years ago.

What are the Property Ownership Laws applicable to foreign investors?

Thai law states that foreigners can own buildings only, they cannot own land. If a foreigner wishes to acquire land there are two basic, tried and tested, options available:

1. Set up a Thai limited company with Thai shareholders and buy the land using this company. The foreign director(s) may not own more than 49% of the shares. However, the foreign director(s) hold all the power, and have effectively complete control, because the company is structured so that the Thai shareholders enter into legal power of attorney with the foreign director(s). The foreign director(s) is the only officer that can commit the company in any contractual dealings. Furthermore, the directors shares are preference shares and typically hold 10 times the voting rights of the other shares, giving the directors over 90% of the voting power.
2. An alternative to having a Thai limited company is for the foreigner to purchase a 30 year lease for the land. Options to extend the lease for 2 further periods of 30 years are normally built into the contract.

Note: It is also possible to combine these two approaches by having a lease contract that also includes the option to buy the freehold when the investor wishes. This is particularly attractive because many people feel that a change in the Thai law is likely which will allow foreign investors to buy freehold without a having a Thai company.

What is the difference between the different land titles in Thailand ?

Just two types of land titles in Thailand over which registerable right of ownership can exist: Chanott and Nor Sor Sam Kor. These are the only land titles that a cautious foreign investor should generally consider.

Chanott

Issued by the Land Department, Chanott titles, and are accurately surveyed and plotted in relation to the national survey grid. The boundaries are marked by unique numbered concrete posts set in the ground. The ownership of the land can be transferred very quickly, within a matter of hours. This is the safest land title for a foreign investor and is the latest standard in Thailand for land ownership.

Nor Sor Sam Kor

These titles, though still measured fairly accurately, are less accurately measured than Chanott. Ownership transfer takes longer than that for Chanott.

Nor Sor Sam

Nor Sor Sam, the predecessor to Nor Sor Sam Kor , has boundaries only recorded with relation to neighboring plots and survey errors of up to 20% are not uncommon. Nor Sor Sam titles also need 30 days advance public notice before any change of ownership.

Which types of property can foreign nationals own ?

• A unit in a registered Condominium
• A building (as distinct from it's land)
• A registered leasehold of up to 30 years for all types of titled land (and/or buildings). However with appropriate extension and purchase options a 30 year lease can become tantamount to freehold purchase.

How easy is it to form a Thai ltd company ?

You need the proper legal assistance and to pay a legal fee, up to 70,000 baht. The process is fairly straightforward and is normally complete in 3 weeks.

How many shareholders do you need to form a Thai ltd company ?

The minimum requirement is 7 shareholders - if you only have 1 foreign shareholder you need 6 Thais.

What are the visa options available for stay in Thailand ?

There are four basic types of visas available for visitors and residents to Thailand.

1. Transit visa - valid for 14 days will be issued to those people arriving in Thailand without a visa. Technically you must have an onward flight ticket, but in practice this visa will be issued almost without question. Note : There are a few countries (not many) that do not require visas and will get a three month entry stamp on arrival - in general these countries are the ones that grant the same rights to Thai nationals visiting their countries.
2. Tourist visa - issued by Thai embassy abroad - these visas will be valid for 60 or 90 days (varies from country to country). Of note is that you may apply for more than one Tourist visa at a time and these multiple visas may be used up consecutively. Many quasi resident visitors to Phuket (who do not work - or want to avoid the red tape of a Non Immigrant visa) live for years on a tourist visa (and go shopping in Singapore or Penang every three months). So long as you are solvent and not engaging in any local business activity, there is nothing wrong with this approach.
3. Non Immigrant visa - issued at an embassy outside Thailand and valid for a 90 day stay, this visa may be extended within Thailand for periods up to one year at a time. There are three basic grounds to obtain and renew a Non Immigrant visa. 1) that you are employed (and have a work permit) in Thailand. 2) That you have Thai family. 3) That you are retired and can prove adequate pension or other financial means to support yourself. Ownership (or long lease) of property has no bearing on the extension of a Non Immigrant visa. Lengthy form filling and copying of personal documents (in duplicate) are required both when you first apply and for every subsequent renewal of this visa. If you hold a non Immigrant visa, you should obtain a Re-Entry permit if leaving the country if you do not wish your visa to lapse.
4. Resident visa - rarely issued and hard to obtain. These visas are issued on a very selective quota basis. Qualification requirements include reading and writing Thai, a fairly strong local financial status and some good (influential) Thai references.

What are the different land measurements in Thailand ?

Land is measured in Rai, Ngan and Wah and prices are usually in baht per Rai or baht per Talang Wah for smaller plots:

• 1 Rai = 4 Ngan or 1600 sqm
• 1 Ngan = 100 sq Wah
• 1 Acre = 2.53 Rai (approx.)
• 1 Talang Wah = 4 sqm = 1 sq Wah
• 1 Rai = 400 Talang Wah 1 Ngan = 100 sq Wah

How is the climate of Koh Samui?

Koh Samui is warm all year, the temperature normally ranging between 21-35 degrees Celsius.

• January to February is the coolest season with the temperature averaging 79 F, 26 C.
• March to May is hot and dry, temperatures can reach 40 C.
• June to September are generally dry, the temperature dropping somewhat.
• October and November are the wettest months but the rain typically comes in hard short bursts, and it not usually that prolonged.