A positive story about buying a house in Thailand

[WhatsNext]

This is a positive report about buying, building and owning a house in Thailand. So if you expect loss of cash, girls running away with the poolhouse or building contractors delivering a plastic box instead of a castle, look elsewhere.

 

Why i write this : Maybe it helps someone feel more comfortable about the whole process. Plus as a balance to all the bad stories out there because people without problems usually don't write so you only get the sad stories.

 

After living in Thailand for a few years and spending quite a sum on rental homes in both pattaya and hua hin, i thought i would be wiser to buy. The average rent i paid for a new 3 bed 2 bath, swimming pool villa was around 40k per month, totaling half a million baht per year. Looking around in hua hin as we were still living there at that time, there were plenty of houses available from 2 million all the way to 72, that last price is in the Banyan project. They deliver Bali style houses for mostly dutch retirees. I am one of those but not interested in spending 72 million. The biggest problem with the 72 million price, is that i don't have the money which apparently made it impossible to get that house.

 

After almost a year however i thought that living around Pattaya would be a better idea for us, Hua hin is not our taste, of course everyone thinks different so if you love that place, all the better for you. Sadly the choice in housing around Pattaya is substantially less than in Hua Hin. It seems most expats decide on a condo with easy access to the beach in Pattaya or Jomtien.

 

Of course it's covid time, so Pattaya is in dire straits at the moment and so is the housing market, which is both sad and on the other side of the coin, also an oppurtunity for lower prices and more choice. I think Pattaya will be back, maybe not 100% in it's former state but certainly a lot better than it is now. Either the old vibe comes back, or more likely the Thai want to transform it to a more middle of the road place. The worst outcome would be that it turns into a Chinese gambling den, but then i would be able to sell my house easily to a chinese customer that's overflowing with money from the fake condo boom in China...

 

After a lot of looking we decided on a house that only had the foundations and the walls there in a project. Of course there were already other finished houses, and really the whole street of about 8 houses was being constructed at the time. After negotiating a substantial discount we agreed on a 5.1 million price. I paid a deposit of 50k baht to secure the house and start the contract phase which would take about a month.

The contract was a mess, basically made for Chinese or Russian customers who don't know their rights or can't read the English/Thai well enough to see what is happening. I told them what i wanted to see in the contract and after a few back and forth they agreed on a more "European" construction contract with a late clause and several certainties for me. I signed the contract and paid the 50%. The other 50% would be paid at the end of the construction after the list of potential problems would have been handled. 

 

The next few months was the construction phase, i have to say that i was pleasantly surprised by the quality and workmanship of the building company that was constructing the entire project. As soon as i paid the 50% the workers concentrated on my/our house and the yet-to-be-sold ones progressed slower. 

There were some minor hiccups during the construction with communication issues and confusion, but nothing more than i have encountered during building previous houses in both Holland and Germany. The house was delivered from the project, after which the company for the inbuilt furniture started working. I didn't have to pay for the house until that company was 100% finished and all the aircon's curtains and inbuilt furniture was in place. That was a pleasant surprise and something that certainly would not have happened in Europe.

 

Now for the ownership part : As i live permanently with a TGF, there are basically 4 options : Thai Company, lease from her, lease from project, or a usefruct. The project company doesn't do leases so that was out of the window. A usefruct was next, but who knew : The pattaya land office doesn't allow for usefructs on foreign names, something that is no problem in Hua Hin.

Leasing from her is easy and safe, but if the relationship would go south which i don't think it will but there is always a possibility of course. If that happened i would not be able to sell without her consent. So that's out of the window too

 

As i know plenty of people with a house in a company i decided on that system and told the TGF that she would get 49%, the mother 2% and myself the remaining 49% BUT also told her that i would have the power and control to sell the company without her consent. Surprisingly she was happy about me telling her the truth and that she understood as it's my cash afterall. 

Now for the funny part : The pattaya land office doesn't allow transfer if there is a foreign owner of the company. So this happens : 1) company is created with lawyer, tgf and mama as owner. 2) house is transferred to the company in the land office. 3) The 49% (with 100% of the votes) of the lawyer is transferred to me. 4) Presto i am CEO of the company and the house.

Yes i know it's weird, yes i know if the government wanted they could dissolve the company and i would have to find another solution (lease). But... this has been going on for many many years and it's accepted like so many things in Thailand are. TIT. But i understand if you don't trust it. I trust it 90% hence my limit on how much money i want tied up in Thailand.

 

Everything went smooth with the land office, went smooth with the lawyer and went smooth with the company transfer. I have the chanote, the company, the empty blue house book and the next step is getting the yellow house book and a pink Thai ID. Will that make me resident ; nope. It's handy to have though.

 

We currently live in the house since a month and all the little things that go wrong with a new house have been solved by the project in record time. Never was there any request for more money or complaints about my complaints. Internet with 500/500 is installed to my surprise as the house is in nakon nowhere a little. 

O yeah, in the end i spend 6.1 million total, inbuilt furniture is expensive, 4 aircons, extra storage room and basically everything needed to be bought as i and the TGF have only rented before. From bed to sofa from fork to tv. 

 

Economic thoughts : Now i safe 500k per year on rent, possibly more in the future with inflation. But lets keep it at the 500k. In 8 years i will have saved 4 million, so i could sell the house for 2 and still break even. i'm 100% sure it will sell for more than that. For me with a long term plan to stay here, it makes sense. For you things can be very different but i wanted to show that buying and owning a house isn't such a big risk or stress.

 

So if you want a house, don't be too scared, do your research and the entire process can even be enjoyable. The end result certainly is. Good luck and thanks for reading. 

[spidermike007]

Good post. Sounds like you did your homework. Who knows where the housing market will go here, but single family residences seem to appreciate more than condos, as a general rule here, and the demand seems to be higher. 

[LosLobo]

Re: Economics thoughts.

 

In your cost benefit analysis did you think about offsets for maintenance and loss of return on capital.

 

Even with an RoR  with a suitable investment @ between 5 to 10 % on B6.1M, your savings on rent could be minimal.

 

Don't want to rain on your parade but just saying!

 

[Tanomazu]

Excellent post, thanks for outlining the process so well and clearly. First time I see this on here.

 

You did it and clearly are loving it, the TGF must love it too, so clearly a win.

 

So you never contacted architects or developers to "bespoke" the plans in any way?

[ezzra]

My post going to be a lot shorter, bought several condos over the years in mostly the affluent suburbs of Bkk, set on them for anywhere between 10 to 20 years and in many cases sold them for 3-4 times the purchase price, but keep it between ourselves, no one need to know about it...

[WhiteBuffaloATM]

interesting case thanks. can never be sufficient detail here of course. house is Detached ? Common Facilities ( Mng. Co.) or Independent ? suppose you have majority company voting rights without which, and without lease, you would have handed over your 6 million / house to thais. under company which you know is technically illegal. also you had no Architect to customize the Basic Plan and manage Developer Build Inspect Payments. Surely should have had Progress Stage Payments rather than 50% Upfront ? first time hearing about buying Off Plan with Foundations & Walls already completed ! your choice of Pattaya ….. considered Phuket or too expensive ?

most interesting & bow to your prior house project experience ! glad it worked out well……

 

In 2006 I bought 10 mill. Leasehold Off Plan Phuket Pool Villa ; Four Story Semi Detached Townhouse inc. Separate Ground Apartment, with Common Owner Managed Area & Facilities. Intended Resale Investment but ended up Renting / Living here ever since Completion. Relied on Proven Developer & their Builder with no Architect.

[Kinnock]

Useful post - thank you!  My own experience was equally positive.

 

After renting a condo in Bangkok for many years (I was working in Central Bangkok) I decided I wanted to live in a house near the sea, as I'm now semi retired.  I decided to build one from scratch, as I wanted a specific design (designed for low solar gain, living area mainly on upper floor, large spacious rooms, office with a view, parking and working area for car and motorcycles.  

 

I opted for a simpler ownership basis than in the OP ..... house in my Thai Wife's name, as I want her to inherit the property anyway (I also have property back in my home country for any future return and for my home country family members).

 

Bought some land that had an old house on it, salvaged the hardwood doors and windows and demolished it.  We needed permission to demolish, for the piling and for the house plans.

 

In the wife's extended 'family and friends' network we have an architect, a building project manager and an AC engineer.  They in turn recommended piling contractors, builders, electricians, joiners, built-in furniture experts etc.

 

I was working overseas through the early stages, but was able to fly back to check the piling.  The wife supervised the whole process closely, and found 'sale' and end of run fittings and tiles etc to minimize costs.  I watched regular video tours when I couldn't be there.

 

Wife and team did an amazing job   Unique design, high quality, completed within my budget.  It was hard work for her - she rented a small condo nearby so she could be on site every day.  Many arguments with builders, a few issues when 'bargain' end of run tiles ended up being a few tiles short, and also when I turned up and pointed out things I wanted changed or improved, but it was all worth it in the end.

 

We had Wills made to leave the house to each other, but after 12 years together I don't think she's going to bury me in the garden and run off with her 'brother'.

 

Total cost must be less than half the equivalent in my home country.  Some cynics may highlight all the risks, but if you're lucky enough to find the right partner in Thailand, mutual trust is a given.

[Pravda]

What's positive about this story?

 

You paid for house (probably overpaid) and they sold it to you.

 

You still don't own a house.

 

I went to McDonald's and bought a burger. Overall it was a positive experience.

[transam]

The Limited company ploy, I am sure Patts land office is fully aware of that farang ploy, and perhaps that avenue will come tumbling down at some time...

 

I often wondered how a company that is set up purely to buy a house for a farang, does the profit and loss etc paperwork that a company must do.. Can someone enlighten me..?

[WhatsNext]

1 hour ago, LosLobo said:

Re: Economics thoughts.

 

In your cost benefit analysis did you think about offsets for maintenance and loss of return on capital.

 

Even with an RoR  with a suitable investment @ between 5 to 10 % on B6.1M, your savings on rent could be minimal.

 

Don't want to rain on your parade but just saying!

 

You are of course 100% right, however i have capital invested already and this was money sitting on a bank with -0.5% interest. It was dead capital to start with, i don't want everything on the stock market. 

[WhatsNext]

19 minutes ago, Pravda said:

What's positive about this story?

 

You paid for house (probably overpaid) and they sold it to you.

 

You still don't own a house.

 

I went to McDonald's and bought a burger. Overall it was a positive experience.

If you want to see everything negative because you made another decision than mine and want to feel superior about it, all hail to you. 

[WhatsNext]

7 minutes ago, transam said:

The Limited company ploy, I am sure Patts land office is fully aware of that farang ploy, and perhaps that avenue will come tumbling down at some time...

 

I often wondered how a company that is set up purely to buy a house for a farang, does the profit and loss etc paperwork that a company must do.. Can someone enlighten me..?

Of course they are aware , it's all over thailand. Of course they can stop it at any point, but they have failed to do so the last 30 years. 

 

There is a yearly fake report being made by the accountant, or real if you want to, i can rent my house from my company and everything will be real. Up to you.

[WhatsNext]

1 hour ago, Tanomazu said:

So you never contacted architects or developers to "bespoke" the plans in any way?

This is a house on a gated development, so you choose from a few house styles / options and the developer already had previous projects, so that made the process very uncomplicated. 

[WhatsNext]

33 minutes ago, WhiteBuffaloATM said:

interesting case thanks. can never be sufficient detail here of course. house is Detached ? Common Facilities ( Mng. Co.) or Independent ? suppose you have majority company voting rights without which, and without lease, you would have handed over your 6 million / house to thais. under company which you know is technically illegal. also you had no Architect to customize the Basic Plan and manage Developer Build Inspect Payments. Surely should have had Progress Stage Payments rather than 50% Upfront ? first time hearing about buying Off Plan with Foundations & Walls already completed ! your choice of Pattaya ….. considered Phuket or too expensive ?

most interesting & bow to your prior house project experience ! glad it worked out well……

 

In 2006 I bought 10 mill. Leasehold Off Plan Phuket Pool Villa ; Four Story Semi Detached Townhouse inc. Separate Ground Apartment, with Common Owner Managed Area & Facilities. Intended Resale Investment but ended up Renting / Living here ever since Completion. Relied on Proven Developer & their Builder with no Architect.

Detached house with pool and covered terrace on a project with facilities and security. I have 100% of the voting rights the others have zero. No architect needed as it's a house on a gated project that is already more than half finished and sells 4 types of houses with minor changes if you want them. 50% was paid when the land was there (of course) and the house was already in progress. The other 50 at full completion. Phuket too expensive and my TGF got sick from driving up and down the hills all the time. Hua Hin too boring (sorry, taste), Samui to remote and Chiang Mai has no beach.  

 

Good that you had a positive experience in Phuket ???? 

[transam]

1 minute ago, WhatsNext said:

Of course they are aware , it's all over thailand. Of course they can stop it at any point, but they have failed to do so the last 30 years. 

 

There is a yearly fake report being made by the accountant, or real if you want to, i can rent my house from my company and everything will be real. Up to you.

So a bit of a gamble, with false documents. Hmmm.

 

Reminds me a bit about that cop who has millions $ stashed, made from luxury car seizures. But, like you say, up to you...????

[WhatsNext]

1 minute ago, transam said:

So a bit of a gamble, with false documents. Hmmm.

 

Reminds me a bit about that cop who has millions $ stashed, made from luxury car seizures. But, like you say, up to you...????

I recommend you read up on how houses are "owned" in thailand under the current rules. There are no false documents. If everything comes falling down it will be for all foreign "home owners" in thailand, not just for me, and will cause such a problem that they'll never do it. If they do, no problem transfer house to TGF of choice, lease back. 

[transam]

3 minutes ago, WhatsNext said:

I recommend you read up on how houses are "owned" in thailand under the current rules. There are no false documents. If everything comes falling down it will be for all foreign "home owners" in thailand, not just for me, and will cause such a problem that they'll never do it. If they do, no problem transfer house to TGF of choice, lease back. 

You quoted false company documents, that must be an offence, surely.

[WhatsNext]

Just now, transam said:

You quoted false company documents, that must be an offence, surely.

Yeah this is thaivisa, of course i expected the wall of negativity to come rolling in, enjoy yourself ????

[transam]

7 minutes ago, WhatsNext said:

Yeah this is thaivisa, of course i expected the wall of negativity to come rolling in, enjoy yourself ????

Sorry, but it is not negativity, I am asking questions responding to your words, if I have hit a nerve I am really sorry, I will leave your thread.....????

[Tanomazu]

Do you find you travel to Bangkok at all for anything or are you totally happy living in Pattaya?

[topt]

11 minutes ago, transam said:

You quoted false company documents, that must be an offence, surely.

You are almost trolling Trans. This subject has been done to death many times and the guy is being very open with what he has done. Stop nitpicking ????

Best of luck to him.

[topt]

3 hours ago, WhatsNext said:

i have to say that i was pleasantly surprised by the quality and workmanship of the building company that was constructing the entire project.

Can you say which company - may be useful to others?

[WhatsNext]

2 minutes ago, transam said:

Sorry, but it is not negativity, I am asking questions responding to your words, if I have hit a nerve I am really sorry, I will leave your thread.....????

No nerves hit or anything, but indeed as TOPT said, this has been done to death for many years now, starting the same discussion again is counter productive. No hard feelings from me though.

[WhatsNext]

3 minutes ago, Tanomazu said:

Do you find you travel to Bangkok at all for anything or are you totally happy living in Pattaya?

Yes i/we regulary go to bangkok as this is where her family lives and i enjoy the malls, the big city feel as well. Actually have been thinking before about moving to BKK in the IconSiam towers, but i would miss the ocean too much. 

[WhatsNext]

2 minutes ago, topt said:

Can you say which company - may be useful to others?

It's the dusit project located in the middle between Pattaya and Sattahip. 

[Tanomazu]

2 minutes ago, WhatsNext said:

Yes i/we regulary go to bangkok as this is where her family lives and i enjoy the malls, the big city feel as well. Actually have been thinking before about moving to BKK in the IconSiam towers, but i would miss the ocean too much. 

May I ask how are you finding the travel to Bangkok? I assume you go by car?

[WhatsNext]

2 minutes ago, Tanomazu said:

May I ask how are you finding the travel to Bangkok? I assume you go by car?

Sure ! i have a car (on my name) since about 3 years, the travel is pretty quick on the tollway number 7. Haven't been going too much though because of the covid situation. Not afraid of the virus, but not looking for it either. I mean this for malls, outside there is no risk as far as i am concerned. 

[Brick Top]

A couple of things that you might have overlooked and I am talking from experience.

In 2004 , I also did a similar thing to what you described , I had a house built in Phuket that cost at the time 17 Million , the value now is around 35 Million. My laywer set up the Thai company in exactly the same way as you described. The problem was my relationship with the TGF ended in 2012 when she ran off with a younger Australian man and moved to Australia with him.

When I tried to sell my house in 2015 , I couldn't as she was a 49% shareholder and her the signed copy of her ID and signed copies of share transfer certificates were deemed useless as her Thai ID card date had expired in 2008. I have no idea of were she is and to date I still can not sell the house until she is found and gives a new signed copy of her ID card. 

Another problem also arose when the DBD investigated my Thai company in 2016 and demanded to see proof of were the ex TGF got the money from to hold 49% of the shares in my Thai company. That investigation is also still ongoing and causing me a lot if stress , I have been told it is illegal to hold a house this way and the DBD are threatening to take me to court about the way I formed a Thai company to buy a house , it is totally illegal they have warned me.

[newnative]

   Great post!  Thanks for sharing.  Nice to read a positive experience.  Welcome to Pattaya.

[WhatsNext]

15 minutes ago, Brick Top said:

A couple of things that you might have overlooked and I am talking from experience. // 

 

Thanks for your honesty, i am aware of the problem with the expired ID cards as well. I am relying in part on the proven honesty of my TGF with her earlier relationship before me. Plus a minimal hope of the thai government making the 8 million "visa" a reality in the future (8 million investment and you can own land/house). Also the 5.1 is a write of in about 8 years for me. 

 

If you or I really can't sell for whatever reason, you can always rent out, i know that's pretty hard in covid times but later should be possible. Good luck to you.

*edit* in your case with the court and so on, i would hire a private eye to find her, and ask for the ID card with cash if needed.