Rent of condominium units on a daily basis

Can a foreigner to rent out his apartment on a daily basis? Is it allowed to rent out an apartment, not having a work permit? That's what Thai legislation sets on the matter.

1. Condominium Act does not prohibit rent of the condominium units for short periods. There is a restriction for business activities, it’s allowed only in areas designated for these purpose, sprovided that commercial activities will not disturb other tenants.

It should be taken into account that there are also internal rules of the condominium, which may contain additional terms and restrictions.

Thus on the first floor (in the unite allotted for commercial activities) can be located a real estate agency, which will deal with rent of the residential units in the condominium, provided that the tenants will not disrupt public order. If the condominium rules prohibit rent on daily basis, the rental period must be in accordance with these rules.

2. Hotel Act

In accordance with the law, the hotel is the residential premises, specially designed for the temporary accommodation of people on a commercial basis consisting of at least 5 rooms of the services capacity of more than 20 guests.

Residential premises up to 5 rooms (in general, at all the building floors, in one or several buildings), with service capacity of 20 and less people shall not be defined as a hotel.

5 and more rooms or capacity of services 21 and more people shall be deemed a hotel and is to be licensed.

3. Alien Working Act

The law defines working working by physical strength or knowledge whether or not intended for

wages or any other benefits. A foreigner is obliged to obtain a work permit before proceeding before he starts working.

To obtain a permit, there have to be company (an employer) which will provide the necessary documents for employment. Without the employer it is impossible to get the work permit and start renting out the property.

Furthermore, the question is whether a foreigner fulfils search for the tenants by himself or not. If not, then he doesn’t perform any work, meaning no work permit is required.

So who is looking for the tenants? If the real estate agency does, the owner should sign an agency agreement to authorize the agency to search for the tenants and enter the rental contracts on behalf of the owner.

Alternatively, a foreigner can register a company, which is engaged in the rental business, employ Thai directors and managers, to be a shareholder of the company (up to 49%), but do not perform and work by himself. In this case work permit is not required as well.

2. Immigration act requires the property owner to notify immigration office about entering the rental contracts with the foreign tenants each time within 24 hours after check-in. If the owner follows this rule and apply the required information about the tenants visiting the immigration office daily, the later may regard such activities as working and ask for the relevant work permit.

So what we can offer to consider is:

1. Check the condominium regulations, if they prohibit daily rent of condominium units or not.

2. Enter into an agreement with a real estate agency and appoint it as a property manager with the right to enter rental contracts with tenants. So then the agency will be responsible for the condominium regulations fulfilment.

3. If you are the owner of several units and you provide the rental services by yourself, you should consider the company registration and obtaining a work permit.

By Aleksandra Agapitova

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