Experience with leasehold?

[habuspasha]

Anyone with experience purchasing a leasehold, especially in Phuket?  Have heard many warn against, but also many saying it can be done.  Seems especially difficult to extend beyond 30 years, but some say that can be done too.  Any guidance would be appreciated.

[Adumbration]

Court has ruled on 30 year leases.  Cannot be extended.

 

And why would you buy an amortizing asset?  Renting has the same net result.

[Pink Mist]

Leaseholds can be extended at the Land office with the Land owner.

[scubascuba3]

Buying leasehold is even more stupid than thai company

[habuspasha]

Some years ago I came very close to buying a villa where the GF would own the land and I would own the building.  (We decided against the particular place after engaging the lawyer.)  Can I assume I can do that today?  If so, does the  leasehold become effectively a freehold for the two of us?  Even if we're not married?

[JBChiangRai]

7 hours ago, Pink Mist said:

Leaseholds can be extended at the Land office with the Land owner.

Only if the land owner agrees at extension time, even if contractually bound to, the land owner can change his mind without penalty because a promised extension has no legal standing as it is viewed as illegal, the law provides for a maximum of a 30 year lease.

Edited April 11, 2023 by JBChiangRai
Punctuation

[Pink Mist]

7 minutes ago, JBChiangRai said:

Only if the land owner agrees at extension time, even if contractually bound to, the land owner can change his mind without penalty because a promised extension has no legal standing as it is viewed as illegal, the law provides for a maximum of a 30 year lease.

You are correct. Most of those leasehold that will be renewed are gated developments where the developer, land owners are also the property managers. I am talking about many houses and not your typical 1 house built on land owned by a relatives friend.

[Thailand]

Had a 30+30+30 lease in Chiangmai. Sold after 18 years to a Chinese who used a shelf company to purchase so lease was voided with agreement from the landowner who we knew well.

Would I do it again, probably not?

[brianthainess]

Do you really think in 30yrs you'll want to stay in the same place, in an old place? or is this about being able to sell your lease on.?

[habuspasha]

10 minutes ago, Pink Mist said:

You are correct. Most of those leasehold that will be renewed are gated developments where the developer, land owners are also the property managers. I am talking about many houses and not your typical 1 house built on land owned by a relatives friend.

This sounds like the kind of place I am looking at.  What makes it likely to be renewed?  That it is gated? expensive? numerous villas? Are the lease holders really the lessors?  It seems hard to believe that people who spend tens of millions for some of these are stupid or unaware of how things actually work.

[Pink Mist]

58 minutes ago, habuspasha said:

This sounds like the kind of place I am looking at.  What makes it likely to be renewed?  That it is gated? expensive? numerous villas? Are the lease holders really the lessors?  It seems hard to believe that people who spend tens of millions for some of these are stupid or unaware of how things actually work.

The land lease I have has been registered at the Land Office and I have copies in both Thai and English. It also shows a right of survivorship to my spouse. Same as my house registration.

[Sandboxer]

Leaseholds are a great way of encouraging an early "accident".... 

 

https://magnacarta.co.th/home/faq-section-2/thai-inheritance-law/#:~:text=A major disadvantage of lease,guarantee for the lessee's heirs.

Edited April 11, 2023 by Sandboxer

[Pink Mist]

4 minutes ago, Sandboxer said:

Leaseholds are a great way of encouraging an early "accident".... 

 

https://magnacarta.co.th/home/faq-section-2/thai-inheritance-law/#:~:text=A major disadvantage of lease,guarantee for the lessee's heirs.

If my spouse was Thai I would have bought a house with the Land and had a usufruct.  Both my spouse and I are listed on the house registration and on the leasehold so she can keep on moving forward. The leasehold has a clause which also allows for the purchaser, if I decide to sell, to have the leasehold start over for another 30 years.

[Thailand]

21 minutes ago, Pink Mist said:

If my spouse was Thai I would have bought a house with the Land and had a usufruct.  Both my spouse and I are listed on the house registration and on the leasehold so she can keep on moving forward. The leasehold has a clause which also allows for the purchaser, if I decide to sell, to have the leasehold start over for another 30 years.

This assumes that the owner of the land agrees or has not deceased and passed it on to someone who does not agree to extend the lease.

I got a little more nervous the older the owner of the land that we leased got. Relieved we got the sale when we did to be honest.

[Pink Mist]

7 minutes ago, Thailand said:

This assumes that the owner of the land agrees or has not deceased and passed it on to someone who does not agree to extend the lease.

I got a little more nervous the older the owner of the land that we leased got. Relieved we got the sale when we did to be honest.

Very true.  The property we are in has over 400 homes between all of the gated areas.  The company which runs it is a corporate company owned by foreigners and Thais. The properties are in the names of the companies owners.

[Kwasaki]

11 hours ago, habuspasha said:

experience purchasing a leasehold, especially in Phuket? 

[khunPer]

12 hours ago, habuspasha said:

Any guidance would be appreciated.

You shall check how many years are left and compare with, what you would pay in rent for the property for that number of years, and deduct the interest loss for prepaying the rent, and furthermore deduct some discount for not being able to terminate the rent with short notice and just leave. Then you have the price to pay.

 

No matter how much you are told and promised about extension, there is no such guarantee available. The at any time owner of the property has no obligations beyond the period of the registered lease servitude. The owner of the property that gave the leasehold might sell it, or die, and a new owner might have other ideas for use. So any agreement, even in writing, will be between you and the land owner that issued the lease agreement, but might not involve the actual owner of the leased property. I.e., you can count the value of such a contract equal to the re-circulation value of the paper it's written on.

[thaibeachlovers]

On 4/11/2023 at 10:56 AM, habuspasha said:

Some years ago I came very close to buying a villa where the GF would own the land and I would own the building.  (We decided against the particular place after engaging the lawyer.)  Can I assume I can do that today?  If so, does the  leasehold become effectively a freehold for the two of us?  Even if we're not married?

5555555555555555

Sooooo, without the benefit of marriage legality, you will pay large to build a house on land you do not own. Do I really need to point out the perils involved in that?

 

I can imagine that the GF is all for that arrangement!

 

BTW, renting would be of more benefit once you work out that Phuket isn't a place you want to live in.

[thaibeachlovers]

On 4/11/2023 at 5:32 PM, khunPer said:

You shall check how many years are left and compare with, what you would pay in rent for the property for that number of years, and deduct the interest loss for prepaying the rent, and furthermore deduct some discount for not being able to terminate the rent with short notice and just leave. Then you have the price to pay.

 

No matter how much you are told and promised about extension, there is no such guarantee available. The at any time owner of the property has no obligations beyond the period of the registered lease servitude. The owner of the property that gave the leasehold might sell it, or die, and a new owner might have other ideas for use. So any agreement, even in writing, will be between you and the land owner that issued the lease agreement, but might not involve the actual owner of the leased property. I.e., you can count the value of such a contract equal to the re-circulation value of the paper it's written on.

Congratulations on injecting some sense into the thread. Will the OP get the message or continue on IMO his path of destruction?

 

Of course, he may be rich enough to just walk away in the event it all goes wrong, in which case carry on.

[thaibeachlovers]

On 4/11/2023 at 4:30 PM, Kwasaki said:

A picture is indeed sometimes worth a million words.

[thaibeachlovers]

Has to be one of the few threads I've read that most of the posters agree the idea is not great.

Perhaps the message is finally getting through that owning property in LOS is not necessarily a good idea.

I made almost every mistake possible to make in my time in LOS, but not that one.

[habuspasha]

15 hours ago, thaibeachlovers said:

Will the OP get the message or continue on IMO his path of destruction?

I know I must test your patience, but here's what I don't understand:  You seem to say a villa purchase is a complete scam, but these are big ticket deals: Villas are close to a million dollars, or more; The Thai-based international company that owns the land provides villa buyer with shares in the company so (they say) lessor and lessee are one and the same;  The owner of the villa is a foreigner (like me) who presumably is able to sell what he bought and get his baht back.  Whether or not the agreement is registered at the land office doesn't seem to matter.  What am I missing?  And thanks for your patience.

[thaibeachlovers]

9 hours ago, habuspasha said:

I know I must test your patience, but here's what I don't understand:  You seem to say a villa purchase is a complete scam, but these are big ticket deals: Villas are close to a million dollars, or more; The Thai-based international company that owns the land provides villa buyer with shares in the company so (they say) lessor and lessee are one and the same;  The owner of the villa is a foreigner (like me) who presumably is able to sell what he bought and get his baht back.  Whether or not the agreement is registered at the land office doesn't seem to matter.  What am I missing?  And thanks for your patience.

No problem.

 

I've been reading this forum for many years, and also before it changed it's name, and I've read so many tales of woe from farangs that bought property, only to have it go horribly wrong that I can only assume that buying is not a good idea in Thailand for foreigners.

 

Plenty of examples of guys that built/ bought houses only to have an all night karaoke or such like set up not far away and their once upon a time valuable asset became an unsalable problem.

The problem is that in Thailand even if the law is on their side, it doesn't always work out for farangs.

Also, hiring a Thai lawyer to rectify legal problems is not a popular idea among A N posters.

Of course, if one is lucky enough to be able to walk away with no regrets if it does go wrong, no reason not to do it.

 

Also, renting is so cheap that I don't know why anyone risks buying ( other than a condo with the correct proportion of Thai vs foreign owners ).

 

I understand that it probably seems like a good idea at the time, but a lot of guys that got married thought it was a good idea at the time, only to regret when it all turned to tears ( including myself ).

How many posters on this thread alone are saying to go for it?

 

You don't have to take my word for it- just read some of the threads in the archive to see what can happen if bad luck.

So, do you feel lucky?

 

However, as the saying goes, "up to you".

[thaibeachlovers]

This isn't really the place for the OP's question IMO.

 

Better to try on the proper sub forum.

Real Estate, Housing, House and Land Ownership

Real estate, housing, buying a condominium in Thailand. Ask all your practical and legal questions here.

[ericg1953]

On 4/11/2023 at 9:24 AM, Pink Mist said:

The land lease I have has been registered at the Land Office and I have copies in both Thai and English. It also shows a right of survivorship to my spouse. Same as my house registration.

I’m entering into a 30yr lease with a well known developer in a gated community as well and have a Thai wife I will put on the lease document with myself.  I’m interested as to how you wrote up the right of survivorship on your lease doc. 
 

Thx

[Thailand]

23 minutes ago, ericg1953 said:

I’m entering into a 30yr lease with a well known developer in a gated community as well and have a Thai wife I will put on the lease document with myself.  I’m interested as to how you wrote up the right of survivorship on your lease doc. 
 

Thx

Would it not be more sensible for your Thai wife to be the owner and you lease /Usufruct through her?

Having a well known developer as the leaseholder does not seem necessary? 

[ericg1953]

It’s not a choice as that is the only way this particular property is being sold. It’s not available in a freehold to have my wife as the owner 

[Thailand]

3 hours ago, ericg1953 said:

It’s not a choice as that is the only way this particular property is being sold. It’s not available in a freehold to have my wife as the owner 

Unusual restriction as 30 + year leases are in a  grey area at best.

Good luck