From the language of Laos to the spicy food and mountainous landscape, the country is reminiscent of northeast Thailand – but with fewer people and less business activity.
Foreigners can’t really own property in Laos
Communist countries are not often the most investor friendly countries. Typically, they tend to be quite self-sufficient and source locally or from politically aligned countries.
Therefore, investors (and in particular foreign investors) are viewed with great suspicion.
Buying property in Laos is no exception to this rule. First of all, to say that one can “buy” real estate in Laos as a foreigner is not really the correct term. Every parcel of land in Laos is technically owned by the state.
However, foreigners suffer the consequences, as they can only lease land for a period of up to 30 years. Unlike other countries with similar regulations, where the renewal of these leases is a mere formality, Laos rarely offers extensions to foreigners.
Oddly, however, you can still retain ownership of the structure that is on the land. It becomes a bit like having a car in a parking spot after you’re no longer welcome – best case is a fine, and they might just take it away.
Some expats have tried to get around these restrictions by using smart corporate structures, in which they own property under a nominated organization in partnership with a Lao citizen.
Yet this is absolutely illegal in Laos and much riskier than doing it in some other neighboring countries.
The key question then becomes, why do you even care to buy property in Laos when there are better alternatives all over South East Asia?
Whto Are The Ggood coins on Laos?
Laos’ industrial property market is expected to continue to benefit from the growing push for manufacturing diversification away from China, just as other countries like Vietnam and the Philippines have done.
It is not unreasonable to expect Laos’ industrialization to continue and its GDP to maintain its exceptional year-over-year growth.
In addition, Laos remains a border market. This usually means that if the economy experiences positive momentum, it can become very lucrative for early investors who took the initial risk and overcome the challenges that arose initially.
I learned this lesson firsthand, as I used to zoom in on my bike looking for Khmer signs in Cambodia that said ‘for sale’, and even went so far as to hire interpreters to be able to wrap it up. the case.
I have benefited enormously from this spirit of adventure and I always recommend investing in Cambodia.
So there is definitely an argument to be made. But in my experience both as an investor and as someone who has done business and lived in South East Asia for many years, Laos is a totally different situation.
That said, it remains possible that real estate ownership in Laos will become easier in the future. Laos currently has a law in the works that would allow foreigners to rent condos for a period of up to 50 years.
Some analysts have even called Laos the “next Cambodia,” saying looser restrictions could increase demand from countries like China, Hong Kong, Japan and Korea. Yet I remain very skeptical.