Where a foreigner can own land: ownership against long lease

In most of the world a foreigner's right to a building and a foreigner's right to the land under it are different questions. The word used on the contract decides what you actually hold, and it is the first thing to establish in any unfamiliar jurisdiction.

The four common arrangements

• Full ownership without a term. The land and the building are yours indefinitely. Available to foreigners in designated zones in the Emirates, generally in Georgia and Turkey, in most of the EU, and in a number of others.
• Ownership of the building, lease of the land. Common in Asia. What you hold is a right that ends, and its value falls as the term runs down.
• A long-term right of use. Ninety-nine years is the usual figure, tradeable and mortgageable and finite. Qatar's second category works this way, as do arrangements in several African and Asian markets.
• Ownership through a local company, where individuals are restricted but domestic legal entities are not. Montenegro's rule on land above a size, Indonesia's structure, and Thailand's practice in various forms.

The questions that matter

• How many years remain — not how many the term was at grant.
• Is renewal a right or a discretion? "Renewable" in a brochure and "renewable at the option of the holder on stated terms" in a contract are different documents.
• What happens at expiry to the building you paid for.
• Can it be sold, mortgaged and inherited, and is any of that subject to consent?
• Does the price reflect the difference? A finite right priced as a perpetual one is the most common overpayment in cross-border property, and it is invisible until the exit.

Categories that are closed almost everywhere

Agricultural land, forest, land in border zones and land near military installations are restricted to foreigners in a large number of countries, including several that are otherwise entirely open. The category of the plot — not what is currently built on it — decides.

The instruction

Ask, in every jurisdiction and before the price: what exactly is being transferred, for how long, and what the register will show in my name. Get the answer in writing from your own lawyer. In markets where the answer is a long lease or a company, that is not a reason to walk away — it is a reason to price it as what it is.