What Is An Usufruct?
Basically it is the right to own property in Thailand through a Thai spouse. Marriage to a Thai national will not have the same advantages regarding co-ownership of property as it would in most other countries, and the Thai spouse will always retain ownership of a property or land regardless of whether or not they contributed financially.
An agreement can be entered into known as a Usufruct Agreement whereby the foreigner may use and enjoy the real estate property, maintain and manage it.The duration of this agreement will be stated in writing and registered at the land office along with the location and address of the property.
In the absence of an agreed period, it will be generally regarded to be the lifetime of the foreign co-owner (subject to the terms of the agreement). Although the foreigner may maintain access and enjoyment of the property following a separation, the foreigner may well loose the property upon the event of a divorce.
For obvious reasons this is dangerous legal territory, and should only be considered by the stupid and the brave, and you should most certainly speak to a lawyer before entering into such an agreement.
Another tried and tested method of acquiring land or property in Thailand is by setting up a Thai Limited Company. Although the foreigner may only hold shares in that company not exceeding 39% he may have effective control over the company by having the Thai shareholders (normally a minimum of three) financial stake in the company reduced to a token sum, and having them agree (using a fairly standard contract document) that they cannot sell or transfer their shares to each other. Having established a Thai Company, the foreigner may then effectively rent the property from their own Limited Company indefinitely.
“Can there be no instance that a foreigner like you will enjoy real estate property in Thailand?”
Under the Civil and Commercial Code of Thailand, a real estate property can be a subject of a Usufruct agreement. Hence, a foreign spouse may be a Usufructuary of the real estate property owned by his Thai spouse.
Entering in a Usufruct agreement with a Thai spouse in order to be valid must be registered in the Land Department of Thailand where the title to the property is located.
A Usufruct executed in favor of a natural person is valid until the expiration of the period intended by the parties. If no time is fixed by the parties in the Usufruct Agreement, it is presumed that it is intended to be enforceable during the lifetime of the Usufructuary. Hence, a foreigner who is designated to be a Usufructuary of a property of his Thai spouse may enjoy the right to use the property subject to a condition that he will exercise reasonable or due diligence over the property.
Through Usufruct Agreement, a foreigner may at least enjoy to the fullest his stay in Thailand. Speak to a lawyer in Thailand before you decide on your property, or contact us for recommendations.