How Are You Controlling Your Property ?

[bkmbkk]

Hi guys

I know there is many different ways to own property ,so I wonder what the best way to buy land and build a house here is - IF - you want to control as to when and why to sale the property as well.

I have a 7 year old daughter (she is Thai national and I am single) that I wouldent mind having as owner - only problem is - I don't want to be told as to when or why to sell the property/ not to sell the property.

I guess that only leaves the ownership through Thai company as the way to go ?

You guys that owns property through Thai company - are you happy with that way of doing it ?

I have been told by a lawyer that companies owning land is being scrutiniced by government - is it a safe way to control land/property? ,or is it really true that owning property through company is not as safe as presented by real estate agents ?

I am renting a house ,but I really hope to get "my own" that I can call home - another thing is that here in Phuket many houses is sitting on (for my taste) much too small plots (roof to roof) and is often built in 2 floors (I prefer 1 floor) with tiny parking area and outside areas and they still costs 6-8 mill - that can be done better I think.

Thanks for your inputs.

[MikeyIdea]

I bought our house in my daughters name, she was 2 at the time and had to sign by doing a thumb print. Easily done in one day and it felt great to do it. Rules;

It's easy to give to children but difficult to take away. You must have clearance from juvenile court to sell and you are only going to get that if selling is good for the child.

You cannot give debt to a child. No loans on the house

The guardian or guardians together control the property for the child until she reaches majority at 20. You need to make sure that you legally have minimum shared custody, sole custody better

If you and the mother still have shared custody, then both parents should agree for juvenile court to allow sale

My personal opinion: Owning property through a company is a deliberate attempt to circumvent the law. As such, it is only safe as long as the law makers want it to be. The courts have the law on their side if they want to act, as long as the house ownership is the majority part of the business the company does.

[Jebhead]

Plus 1 on above about company route.

It used to be when you needed the required amount of Thai people for company you would just use all the skivvy's in solicitors office, but i hear now that you have to prove they work for your company, collect a salary, pay taxes etc etc, in addition to that i believe your company will get audited - if possible i would avoid the company route...

JH

[bkmbkk]

Thanks for your input so far !

Sounds like the company way is a bit of a mess - it is a suprise to me that so many forigners are owning property through company ,and apparently have so litle control over their investment if their company is checked by the government !

I would love to give my daughter a house - I just don't like her mother to deside if I can or cannot sell the property (or anybody else for that matter).- but that may be the only way to do it legal ? I can include a rental contract or a usufruct so at least I won't be forced off the property if things turn bad.

I daught her mother will let me get sole custody so I will always have her in the background.

[MikeyIdea]

Shared custody for father: Legally married at the amphur OR legitimize child at amphur -> all 3 must agree (child mother and father, generally open first when child becomes around 7 years old because of that)

Not have any of the above and mother has sole custody

Good Luck

[InterestedObserver]

I can include a rental contract or a usufruct so at least I won't be forced off the property if things turn bad.

You cannot give encumbered land to a minor child. So any lease or usufruct would have to come after the minor child owns the land and then only with juvenile court approval.

[Delight]

I bought our house in my daughters name, she was 2 at the time and had to sign by doing a thumb print. Easily done in one day and it felt great to do it. Rules;

It's easy to give to children but difficult to take away. You must have clearance from juvenile court to sell and you are only going to get that if selling is good for the child.

You cannot give debt to a child. No loans on the house

The guardian or guardians together control the property for the child until she reaches majority at 20. You need to make sure that you legally have minimum shared custody, sole custody better

If you and the mother still have shared custody, then both parents should agree for juvenile court to allow sale

My personal opinion: Owning property through a company is a deliberate attempt to circumvent the law. As such, it is only safe as long as the law makers want it to be. The courts have the law on their side if they want to act, as long as the house ownership is the majority part of the business the company does.

I am struggling to understand the last part of your post

It reads :

'The courts have the law on their side if they want to act, as long as the house ownership is the majority part of the business the company does.'

Does what!

Am I missing something obvious?

That aside

Just after the 2006 coup -an attempt was made by the new Government to legislate that if a Farang has 50% or more control of a Thai Company-then this Company must be a Farang Company

A Farang Company for a typical Farang house purchaser would be financially out of the question.

This piece of legislation failed.

Thai people and the Government have a conflict. Emotional they hate Farang controlling land.. . Commercially ,because of the use that land is typically put to i.e. building houses and Condos, -they love it.

If that particular piece of legislation had passed then in a stroke they would have killed -stone dead- the building industry in those areas where Farang choose to live and buy property.

Also in the eyes of the world they would been seen to going back to a feudal sytem. (my view)

At the time they took the view that farang would be perfectly happy to lease land and then build.

Given that the Thai Law only supports a 30 year lease-I think they failed to understand the attitude of many farang to house ownership.

For that reason I am perfectly happy that farang uses the 'Thai Company Device' to secure land for house building purposes.

Would I do it personally -NO!

[MikeyIdea]

I bought our house in my daughters name, she was 2 at the time and had to sign by doing a thumb print. Easily done in one day and it felt great to do it. Rules;

It's easy to give to children but difficult to take away. You must have clearance from juvenile court to sell and you are only going to get that if selling is good for the child.

You cannot give debt to a child. No loans on the house

The guardian or guardians together control the property for the child until she reaches majority at 20. You need to make sure that you legally have minimum shared custody, sole custody better

If you and the mother still have shared custody, then both parents should agree for juvenile court to allow sale

My personal opinion: Owning property through a company is a deliberate attempt to circumvent the law. As such, it is only safe as long as the law makers want it to be. The courts have the law on their side if they want to act, as long as the house ownership is the majority part of the business the company does.

I am struggling to understand the last part of your post

It reads :

'The courts have the law on their side if they want to act, as long as the house ownership is the majority part of the business the company does.'

Does what!

Am I missing something obvious?

That aside -

************ Snip end

Anyone who has experience interpreting financial statements can very easily see what the majority of the business in a company is. If the majority business is a residential house ownership, then that's a risk. If the majority of the assets the company has is a residential house, then that's a risk. Both those indicators point toward a company deliberately setup to circumvent the law

[clinique]

Not an easy question to answer.

Using a Thai company with nominees is technically illegal, so if scrutinized, it will be undone - you lose.

If the Thai shareholders are 'nominees' it will be scrutinized and undone - you lose.

Afer 30 years and many discussions with lawyers, land department officials, and thru experience, the safest answer IMO seems to be to buy the land in your wifes (partners ) name, register a long term lease (or usufruct), build the house and have the house and other buildings owned by you. (in thailand the owner of the land and the owner of the buildings can be different).

The lease (30 + 30) or ususfruct gives you right of tenure.

An enuring power of attorney from the owner gives some security toyou over the land but not 100%.

Also if you wish to finance the property some banks will not allow 30 yearleases or usufructs...????

Hope this helps..

[clinique]

Not an easy question to answer.

Using a Thai company with nominees is technically illegal, so if scrutinized, it will be undone - you lose.

If the Thai shareholders are 'nominees' it will be scrutinized and undone - you lose.

Afer 30 years and many discussions with lawyers, land department officials, and thru experience, the safest answer IMO seems to be to buy the land in your wifes (partners ) name, register a long term lease (or usufruct), build the house and have the house and other buildings owned by you. (in thailand the owner of the land and the owner of the buildings can be different).

The lease (30 + 30) or ususfruct gives you right of tenure.

An enuring power of attorney from the owner gives some security toyou over the land but not 100%.

Also if you wish to finance the property some banks will not allow 30 yearleases or usufructs...????

Hope this helps..

[chickencurry]

Hi BKMBKK, FWIW we bought our villa in Phuket 30+30+30 lease. We are now selling it and have been told by our lawyer that it's easier to "assign the lease" rather than someone converting to company owned freehold. I know there's opposing views on here about this, but just telling you what we have been told. Apparently our contract has it covered for easy assignation of lease.

By the way, you mentioned about landplots and know exactly what you mean about the crammed in ones on Phuket. Why do they do it? Our property is on an established secure estate in Nai Harn and the plots on this estate are bigger than most. We're on a land plot of 1,215 sq metres. The inbuilt area of the villa is 407 sq metres. Other bigger plots on this estate too, though of course I'd love you to buy our villa

[clinique]

Interesting that so many people have 30+30 or 30+30+30 year leases.

Under Thai law the Maximum is 30 years - regardless of any contracts or promises to renew. Even if you sign a 30 year lease AND a 30 year renewal now, it is not valid under the law and will be reduced to a maximum term of 30 years..

see link30 year link

[ESB7]

Thanks for your input so far !

Sounds like the company way is a bit of a mess - it is a suprise to me that so many forigners are owning property through company ,and apparently have so litle control over their investment if their company is checked by the government !

I would love to give my daughter a house - I just don't like her mother to deside if I can or cannot sell the property (or anybody else for that matter).- but that may be the only way to do it legal ? I can include a rental contract or a usufruct so at least I won't be forced off the property if things turn bad.

I daught her mother will let me get sole custody so I will always have her in the background.

Easiiest way is put it in your wifes name, unless of course it is not a legal marriage and just one of those money grabbing sin sod cermony things

Edited April 1, 2011 by ESB7

[bkmbkk]

Since I'm not married and have no plans to get married that option is pretty much gone.

My daughter is the only one I would consider to give a property, but if it in reality is becomming her mother and juveinile court that will have the last say, I don't feel I wanna go that way and become a bitter man (maybe). - what will the chance be that the court issue a usufruct or a 30 year lease in case I give my daughter the land ?

Buying a house that has a 30 year lease contract don't sound appiling to me as well - as I understand 30 year is max you can get on a lease contract (+ and + 30 don't count)..

Now I'm back to company owner ship - I just have to convince myself that it won't be scrutinized and I loose the lot.

Itt's time for the government to allow forigners to own a plot for their private house (say 1000 sqm) - but that will properly never happen !

[MikeyIdea]

"what will the chance be that the court issue a usufruct or a 30 year lease in case I give my daughter the land ?" - Zero, difficult to motivate how that can be good for the child