Usufructs & Property in Thailand

Usufruct’s in Thailand are seeing an increase in use as many foreigners would buy property in the name of their Thai wife. In order to provide some protections since foreigners are not allowed to own land they tend to register a usufruct over the property in their name sometimes for the duration of their life.

In the event of a divorce the usufruct will give you a bit of leverage during negotiations and it also allows you to still live in the house after the divorce if the usufruct is not removed. Usufruct’s are an important legal tool for investment and property development without owning any land. You could take a usufruct over a palm oil plantation and based on the usufruct and reap the rewards by doing this.

Since a usufruct is a real right, the title creating the usufruct is required to be registered with the Land Office as it goes against the title deed of the property. If the property is sold the new owners would still have to allow you to exercise that right. Under Thai law, a Usufruct may be constituted either for a specific period of time or for the lifetime of the usufructuary.

Do you see the advantages?

If the usufruct does not stipulate a time period is is presumed to be for the lifetime of the person who holds the usufruct.  Now you can also acquire a House Registration Certificate enabling you to lease or rent out the property and receive rental income from the property. Now if you die so does the usufruct. Thai law now allows you to draft the usufruct and register it so that in the event of your death you can now register who in your family (heirs) will get to continue this property right for 30 years.

The usufruct is almost like a servitude but cannot really be inherited like a servitude. If you need more assistance with what property options Thailand has to offer when it comes to the use of land for farming, development or property development then speak to our attorneys in Thailand for more information and legal guidance.

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