The crackdown on illegal structures allowing foreigners to bypass the prohibition on land ownership is causing significant hesitation among buyers of high-end villas in Phuket and Koh Samui.
Thai authorities have intensified their fight against ownership structures that enable foreigners to circumvent the legal limit of 49% of shares in a company. The Department of Business Development has thus flagged more than 11,400 companies on Koh Phangan and Koh Samui, representing nearly 68% of registered companies in these two islands of Surat Thani province.
More than 7,000 companies, mainly active in real estate, tourism and hospitality, are suspected of using fictitious Thai shareholders. Since the beginning of the year, more than 850 companies have already been prosecuted, with estimated damages exceeding 15 billion baht (~€400M or £344M).
See also: Koh Samui Scandal: Fake Building Permits Threaten Hundreds of Luxury Villas
Without precise official data, the Juwai IQI group estimates that three out of five transactions in Phuket and nine out of ten in Koh Samui and Koh Phangan involve a foreign buyer or tenant, affecting between 2,400 and 3,000 villas.
“International buyers represent the overwhelming majority of activity in the high-end villa market in Phuket and Koh Samui. We are seeing greater hesitation, particularly among those still evaluating their options.”, said Felix Desjardins, real estate advisor at List Sotheby’s International Realty Thailand
This caution is resulting in slower decisions and, at times, a temporary shift towards condominiums, whose legal framework is simpler for foreigners.
Chinese buyers remain the leading foreign investors in Thai residential real estate, although their acquisitions mainly concern apartments. In 2025, they purchased 4,940 units for 18.5 billion baht, down 12.9% in volume and 30% in value.
“We are going through a period of greater caution and thorough checks, rather than an outright abandonment of transactions. Buyers are asking more questions and taking more time to understand ownership structures.”, observes Karlo Pobre, deputy director of advisory services at Colliers Thailand. Developers, he adds, have not yet changed their luxury villa development strategy.
The Singaporean group Banyan Group sells its villas through a legal thirty-year leasehold structure, renewable and registered with the authorities. According to Stuart Reading, managing director of real estate development for the group, well-advised buyers now favour projects with a clear legal framework from the outset.
See also: Koh Samui and Koh Phangan: tourism professionals call for zero tolerance against local mafias
On Koh Samui, several foreign real estate players accused of fraudulent practices are reportedly in turmoil. Some are seeking to pivot, while others attempt to intimidate expatriates who are increasingly reporting these activities. Faced with the ineffectiveness of their posturing, some are even considering leaving the country. New revelations could soon shed light on organised crime networks linked to real estate, very active on the three islands.
To avoid any risk, experts recommend using an experienced agent and lawyer. The two safest routes are to purchase a villa registered as a condominium in freehold or to take out a thirty-year lease. Leases purportedly renewable over ninety years are, however, considered unenforceable.
BangkokPost & ZoneSamui