Condominium buildings rise above Chatuchak Park in Bangkok. (Photo: Pattarapong Chatpattarasill)

The government has played down concerns raised over the possible negative impacts of its proposal to increase the foreign ownership quota for condominiums to 75% and extend land leasehold terms to 99 years.

The government could always issue more regulations to deal with what is now feared to adversely impact Thais, government spokesman Chai Wacharonke wrote in a post on his Facebook page.

According to the government’s proposal, the foreign ownership cap in condominiums would be raised from 49% of usable space to 75%. The maximum land lease term for foreigners would be 99 years, compared with the current terms of 30 and 50 years. Land leases can currently be renewed once, subject to agreement by both the lessee and landowner.

While foreseeing substantial economic benefits from the proposal, the government was also listening to the opinions of all sides, Mr Chai said.

He listed four common concerns raised since the proposal first made headlines last month and sparked public debate.

First, some people are concerned the changes could cause property prices to skyrocket and make properties unaffordable for many Thais, he said.

Second, some foreigners may purchase condos with the intention to rent them out under short-term contracts to tourists.

Third, foreigners with financial resources might secure leasehold contracts of many conjoined plots of land in an area to operate a business, which might give them a competitive edge over Thai business operators with less money.

And fourth, when the proportion of foreign condo ownership exceeds that of their Thai counterparts, the foreigners might find a way to work around the rules limiting their right to vote on project management and take control, he said.

“The fact is that the government will always be able to consider issuing a new rule to address all of these feared scenarios if necessary, for the sake of ensuring fairness and protecting the interests of Thai people,” Mr Chai wrote.

For instance, he said, even if a 75% foreign quota is introduced, there could be a condition that limits voting rights by foreigners on matters related to the condo’s juristic person operation at 49%, he said.

Deputy Interior Minister Chada Thaised fielded questions from the opposition about the proposal in the House last week. He said the cabinet at this point had only approved the proposal for further study and not for implementation yet.

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