Selling On A Leased Home

[samuigal]

Hi, I just came across this forum which I see seems to have a lot of property advice. We hope we can move soon to Pranburi, Hua Hin or Cha Am but we have come across a lot of difficulties and we are looking for help. Can anyone please advice us about our problem with respect to selling our house. We decided to retire to Thailand so we bought a pool villa in Koh Samui about 3 years ago under a 90 year lease agreement and before we bought it we took the advice of a lawyer who helped us with a title search and prepared our lease for us. Now we decided to sell our villa for 3 million baht less than what we bought it for and we have a potential buyer but our original lawyer has moved away from Samui and also the builder who built our house has gone back to his own country. We took our papers to the land office but we were told through our Thai interpreter we need to find the original land owner who signed our lease if we wish to create a new lease for our buyers. All we have is a Thai name on the lease but we don't even know who this person is let alone be able to contact her. We think she is a friend of the builders wife. My husband and I feel very foolish because it seems we may be stuck with this house without being able to sell it on. Can anyone tell me if they have had a similar problem or perhaps you know someone who has a same dilemma? We were assured when we bought our villa we would be able to sell on our house but now we have been told we can only sub let it for a remaining 27 years and after this time which will be 30 years we have the option to buy our house back again because we are now told the option to renew the lease after 30 years means we need to pay for the house all over again after 30 years. This came as quite a shock to us even though we realize we will probably be dead by then anyway but we would have liked to have passed on our asset to our children. Every day we hear new facts which makes our problems much more confusing. So far we have spent over 30,000 baht getting advice from 2 different lawyers who only tell us the same that we are in an impossible position unless we find our Thai land lord and they can't help us with this because of a privacy law. Our lease says we have the right to sublease our villa but we didn't know we would still need permission from the Thai land owner. Our lease is in English but now we are told the true lease is in Thai which is registered in the land office and the Thai version is not a true reflection of the English copy although our lawyer assured us it was when we originally bought the villa. It's a very messy situation that we have found ourselves in and any constructive advice would be very welcome. Just now we are thinking selling our villa is impossible so the best option we have is to rent it out and find another place to rent which is not ideal but may be our only option.

[jackdawson]

although our lawyer assured us it was

was he thai (were u paying him?) , were his lips moving and were sounds coming out ?

god , this just gets better and better

note to self : NEVER (EVER) buy / long term lease in Samui

ps if i were u i'd double check all the paperwork on the pranburi side, pay maybe three lawyers this time, and THEN walk away

pss have u heard of renting ?

Edited May 27, 2010 by jackdawson

[Forkinhades]

^ usual rubbish reply from jd

To the OP, I think it is illegal to get a 90 year lease. Think the best you can is sub let it out. Sorry to say that after what you said, you will never be able to sell it. Best of luck, and please keep us all posted of your progress.

[Mario2008]

No expert, but you have the make a distinction between the house and the ground. The house is yours, the land is the part that you lease. No need to buy the house again, but you will need to lease the ground again.

[InterestedObserver]

Unless you can locate the property owner you cannot "sell" the leased home. The best you can do is sublease the property per the terms of your original lease. By the way, there is no such thing as a 90 year lease, only the first 30 years can be registered with the local land office and therefore be legally enforceable.

[123ace]

You will not get much if any good practical advice here as your situation may be diagnosed quite clearly as a catalogue of small disasters.

In the absence of the builder / lawyer etc you need a new lawyer, based in samui and with the proven ablity to handle farang lease property.

Don't assume this is a lost cause.

Don't panic and try not get despondent. Panburi is a whole better place than Samui, this is a positive move and you will not miss samui, I know I don't!

[Boater]

Have you got the land title? , as the previous owner of the land will be on it ( hopefully ) ....... ( all in thai those ) if you need any assistance, PM me your email address, as i am based in Samui and your problem can be asily sorted if you use the right people !

cheers

boater

[123ace]

Unless you can locate the property owner you cannot "sell" the leased home. The best you can do is sublease the property per the terms of your original lease. By the way, there is no such thing as a 90 year lease, only the first 30 years can be registered with the local land office and therefore be legally enforceable.

The method is not a sub-lease but to assign or transfer the lease rights for the remainder of the unexpired term. Correct on the 30 year term, however if the lease agreement has renewal provisions (which we may assume it does) then these rights would also be transferred to the new lessee.

None of this is new. The OP needs to track down the Lessor and inform them that the lease is being transferred to a third party.

[InterestedObserver]

That's the problem, there cannot be a new lessee registered on the Chanote until the lessor is located and appears at the land office. Until such time, only those terms covered by the original lease, such as subleasing or the right to assign, can be initiated. Also, 30+30+30 renewal options (the so-called 90 year lease) has never been sanctioned by the court and some say unenforceable especially if there is a new land owner.

Edited May 27, 2010 by InterestedObserver

[falkan]

Who wants to buy a house that they just lease for 27 years, congratulations you have just lost a lot of money, and the next time try to read what applies when buying a house.

If you want to buy real estate in Thailand buy an condo, atleast you can own that!

Do not believe everything people say to you, google is your friend!

[samuigal]

No expert, but you have the make a distinction between the house and the ground. The house is yours, the land is the part that you lease. No need to buy the house again, but you will need to lease the ground again.

Yes I think that's true Mario but the problem is if we can't find the land owner after 3 years what chance will our children have to find her after 30 years and even if they were lucky enough to seek out the land owner which is highly unlikely, there is nothing on the lease agreement to limit the charge for a new 30 year renewal.

Thank you to all responders. I think we have resigned ourselves to the fact we can use our villa for a further 27 years at which point we will have to give it up. The irony is even if we rent it out at 35,000 baht per month for the next 27 years we will only get back about the same as we originally paid for it. Makes you realize renting is far better than buying in Thailand!

[samuigal]

Have you got the land title? , as the previous owner of the land will be on it ( hopefully ) ....... ( all in thai those ) if you need any assistance, PM me your email address, as i am based in Samui and your problem can be asily sorted if you use the right people !

cheers

boater

I only have a copy of the land title but we already know the name of the title holder but we can't find her present address to contact her. How can I PM you?

[Forkinhades]

No expert, but you have the make a distinction between the house and the ground. The house is yours, the land is the part that you lease. No need to buy the house again, but you will need to lease the ground again.

Yes I think that's true Mario but the problem is if we can't find the land owner after 3 years what chance will our children have to find her after 30 years and even if they were lucky enough to seek out the land owner which is highly unlikely, there is nothing on the lease agreement to limit the charge for a new 30 year renewal.

Thank you to all responders. I think we have resigned ourselves to the fact we can use our villa for a further 27 years at which point we will have to give it up. The irony is even if we rent it out at 35,000 baht per month for the next 27 years we will only get back about the same as we originally paid for it. Makes you realize renting is far better than buying in Thailand!

Sorry to say, but that is a terrible yield, and also the landowner will materialize after 27 years, to claim the land back!

Best of luck

[cangetman]

although our lawyer assured us it was

was he thai (were u paying him?) , were his lips moving and were sounds coming out ?

god , this just gets better and better

note to self : NEVER (EVER) buy / long term lease in Samui

ps if i were u i'd double check all the paperwork on the pranburi side, pay maybe three lawyers this time, and THEN walk away

pss have u heard of renting ?

i am afraid you are up the creek with out a paddle , no such thing as a 90 year lease does not exist simple no debate required on this only 30 years , having the agreement in english is worthless and means nothing no debate required on this . I genuinly think you have more chance of becoming the next President of the USA than sorting this issue out. being serious for a moment i share your pain i am going through a similar situation only comfort i have is knowing i have a 30 year lease registered at the Phuket land office it is in thai and english ! but the reality is in this mango republic even this means very little .

[falkan]

No expert, but you have the make a distinction between the house and the ground. The house is yours, the land is the part that you lease. No need to buy the house again, but you will need to lease the ground again.

The irony is even if we rent it out at 35,000 baht per month for the next 27 years we will only get back about the same as we originally paid for it. Makes you realize renting is far better than buying in Thailand!

Renting is not better if you guys were smart in the beginning..

if you were smart you would have created a company and through that could own house/land and could easily sell the land/ house when you want. For there is no reason for the landowner to extend the lease after 30 year if you not pay him a juicy sum of money..

you guys did a big mistake, just dont do it again!

[Forkinhades]

No expert, but you have the make a distinction between the house and the ground. The house is yours, the land is the part that you lease. No need to buy the house again, but you will need to lease the ground again.

The irony is even if we rent it out at 35,000 baht per month for the next 27 years we will only get back about the same as we originally paid for it. Makes you realize renting is far better than buying in Thailand!

Renting is not better if you guys were smart in the beginning..

if you were smart you would have created a company and through that could own house/land and could easily sell the land/ house when you want. For there is no reason for the landowner to extend the lease after 30 year if you not pay him a juicy sum of money..

you guys did a big mistake, just dont do it again!

Doubt whether they would have the funds now

[alfieconn]

No expert, but you have the make a distinction between the house and the ground. The house is yours, the land is the part that you lease. No need to buy the house again, but you will need to lease the ground again.

The irony is even if we rent it out at 35,000 baht per month for the next 27 years we will only get back about the same as we originally paid for it. Makes you realize renting is far better than buying in Thailand!

Renting is not better if you guys were smart in the beginning..

if you were smart you would have created a company and through that could own house/land and could easily sell the land/ house when you want. For there is no reason for the landowner to extend the lease after 30 year if you not pay him a juicy sum of money..

you guys did a big mistake, just dont do it again!

That option isn't exactly a smart idea either.

[falkan]

No expert, but you have the make a distinction between the house and the ground. The house is yours, the land is the part that you lease. No need to buy the house again, but you will need to lease the ground again.

The irony is even if we rent it out at 35,000 baht per month for the next 27 years we will only get back about the same as we originally paid for it. Makes you realize renting is far better than buying in Thailand!

Renting is not better if you guys were smart in the beginning..

if you were smart you would have created a company and through that could own house/land and could easily sell the land/ house when you want. For there is no reason for the landowner to extend the lease after 30 year if you not pay him a juicy sum of money..

you guys did a big mistake, just dont do it again!

That option isn't exactly a smart idea either.

better alternative than what they originally chose..

[Forkinhades]

^ indeed, at least they could sell now

[falkan]

No expert, but you have the make a distinction between the house and the ground. The house is yours, the land is the part that you lease. No need to buy the house again, but you will need to lease the ground again.

The irony is even if we rent it out at 35,000 baht per month for the next 27 years we will only get back about the same as we originally paid for it. Makes you realize renting is far better than buying in Thailand!

Renting is not better if you guys were smart in the beginning..

if you were smart you would have created a company and through that could own house/land and could easily sell the land/ house when you want. For there is no reason for the landowner to extend the lease after 30 year if you not pay him a juicy sum of money..

you guys did a big mistake, just dont do it again!

Doubt whether they would have the funds now

the user does not seem to be panic, suggesting that the 10 million was not a major hole in there wallet and to spend so much money without knowing how the law works makes me think they have enough so they flourish in the future..

[simon43]

A couple of points here.

The assumption being made is that the OP owns the house, but not the land that it is sitting on. That doesn't seem to be the case at all. They do not own the house unless their name is on the building permit. It sounds like they have a 30 year lease on a house that they do not own, which is sitting on land that they do not own, (lease is not any more than that because >30 years is unenforceable).

If the owner of the land is not to be found, and there are 27 years left on the lease, is it possible (I'm not a lawyer so do not know), to claim 'squatter's rights', whereby you can claim ownership of the house/land because the owner has not put in an appearance for x number of years. (Of course 'you' in this case would mean a Thai person...)

Sorry not to have happier news...

Simon

[jackdawson]

Makes you realize renting is far better than buying in Thailand!

god i wish i had said that !

[chiangmaibruce]

<snip>If the owner of the land is not to be found, and there are 27 years left on the lease, is it possible (I'm not a lawyer so do not know), to claim 'squatter's rights', whereby you can claim ownership of the house/land because the owner has not put in an appearance for x number of years. (Of course 'you' in this case would mean a Thai person...)<snip>

Yes a thai person (but not a foreigner) can claim squatters rights (also known as adverse possession) under certain circumstances, including the fact that they paid land tax each year. Depending on the nature of the land title they only have to be in residence for as little as one year! (Refer p86, Your Investment Guide to Thailand, Silkworm Books, 2010)

I doubt though that this would apply to a situation whereby they were leasing the property in question.

[Forkinhades]

Makes you realize renting is far better than buying in Thailand!

god i wish i had said that !

I bought my house 8 years ago, and the rent I would have paid, would have been more than I paid for the house. I also have another 25 years until I reach retirement age.

[MikeyIdea]

Who wants to buy a house that they just lease for 27 years, congratulations you have just lost a lot of money, and the next time try to read what applies when buying a house.

Many do, if the money is right. I bought a house with 15 years left on the lease of the land in Bangkok and it was economically the best deal I have done in my whole life.

OP, a lawyer can go to the land office and get contact information of the owner, no problem. The owner is stated on the chanoot ti din. I don't know if the owner can be forced to sanction transfer of the lease or not, the lawyer or the land office officers can tell you. I recommend that you bring a lawyer to the land office

Don't automatically give up on this one

Edited May 31, 2010 by MikeyIdea

[123ace]

No expert, but you have the make a distinction between the house and the ground. The house is yours, the land is the part that you lease. No need to buy the house again, but you will need to lease the ground again.

The irony is even if we rent it out at 35,000 baht per month for the next 27 years we will only get back about the same as we originally paid for it. Makes you realize renting is far better than buying in Thailand!

Renting is not better if you guys were smart in the beginning..

if you were smart you would have created a company and through that could own house/land and could easily sell the land/ house when you want. For there is no reason for the landowner to extend the lease after 30 year if you not pay him a juicy sum of money..

you guys did a big mistake, just dont do it again!

Falkan - you are so wrong, for a start the company would be illegal, and I know thare are legions of clever dick farang that think its fine, but its not, and very recently all companies set up for this purpose came very close to being govt instructed to unwind. The prospect that at some point in the short to medium term that companies set up for this purpose will once again come under the spolight is almost a guarantee and at that point panic will take over denial yet again.

A 30 year lease may at that point be better than company structure, although freehold condo tops them all.

[Forkinhades]

No expert, but you have the make a distinction between the house and the ground. The house is yours, the land is the part that you lease. No need to buy the house again, but you will need to lease the ground again.

The irony is even if we rent it out at 35,000 baht per month for the next 27 years we will only get back about the same as we originally paid for it. Makes you realize renting is far better than buying in Thailand!

Renting is not better if you guys were smart in the beginning..

if you were smart you would have created a company and through that could own house/land and could easily sell the land/ house when you want. For there is no reason for the landowner to extend the lease after 30 year if you not pay him a juicy sum of money..

you guys did a big mistake, just dont do it again!

Falkan - you are so wrong, for a start the company would be illegal, and I know thare are legions of clever dick farang that think its fine, but its not, and very recently all companies set up for this purpose came very close to being govt instructed to unwind. The prospect that at some point in the short to medium term that companies set up for this purpose will once again come under the spolight is almost a guarantee and at that point panic will take over denial yet again.

A 30 year lease may at that point be better than company structure, although freehold condo tops them all.

If they closed the company route for owning a property, then Thailand will just go into freefall recession. Far too many properties bought through this means.

[InterestedObserver]

The assumption being made is that the OP owns the house, but not the land that it is sitting on. That doesn't seem to be the case at all. They do not own the house unless their name is on the building permit. It sounds like they have a 30 year lease on a house that they do not own, which is sitting on land that they do not own, (lease is not any more than that because >30 years is unenforceable).

It might be worthwhile for the OP to ask the land office who the registered owner of the house is. We know the land is leased, but did the OP get the house registered in his name after having paid the builder?

[LivinLOS]

Makes you realize renting is far better than buying in Thailand!

god i wish i had said that !

I bought my house 8 years ago, and the rent I would have paid, would have been more than I paid for the house. I also have another 25 years until I reach retirement age.

And if you had bought AAPL with it you could probably buy half your local area (about 2000% or so in 8 years).

Why do 'owners' never seem to understand the time value of money ?

[freethefour]

Hope you sort out your problem, if you do mangae to sell

then bank that cash then rent in future. My god I could never imagine

myself buying any property in Thailand. You could get ripped

off on the initial deal or like you have headaches when it comes

to selling. When you have problems with big issues like this who

can you turn to, a Thai lawer........... risky, he could stich you

up then who do you turn to.............. the police or local government

centre............. how much help will you get there?