Buying A House But...

[Guderian]

I am interested in buying a house in Pattaya. I had spent 9 months looking before I found this place, and I really do like it. I agreed the price with the owner with minimal haggling, and she sent the paperwork to my lawyer to check. The owner is a Thai lady and the house is in her name.

Unfortunately, what is described on the construction permit is not what has been built on the land. I have been advised by the lawyer (and an estate agent friend has confirmed to me) that this is not especially unusual, or difficult to fix, the owner just has to get a set of blueprints of the actual property drawn up and then apply for a new building permit. Once that is granted (and I am told that it pretty much always is here) then everything is legal and the property transfer into my company can go ahead.

However, if it all works out then I will end up with a lovely house that the construction permit will say was built in 2011, when it was actually built some 22 years earlier. I can imagine if I ever wanted to sell the place at a later date this might cause some problems.

Has anyone had any experience of this? Are there any other drawbacks or problems that I am missing?

Grateful for any help.

Edited November 7, 2011 by Guderian

[InterestedObserver]

The building permit is only used to get the house owner registered the first time and get a housebook issued. Thereafter you are buying from the registered owner "as is where is" so to speak and only need a valid Thai language sale of structure agreement registered at the land office. If this was unregistered new construction, then the building permit would be of more importance.The land is a separate issue.

Edited November 7, 2011 by InterestedObserver

[thaiwanderer]

Technically its an illegal build and demolition could be ordered without guarantee of the ability to rebuild anything.

If the BP issue isn't sorted by her before sale you are buying the potential problem.

If its so easy she can (and for your purposes, should) get it done before sale.

She's apparently not had any issues in 22 years but you aren't her and its up to you to assess the risk.

[TommyDee]

The building permit is only used to get the house owner registered the first time and get a housebook issued. Thereafter you are buying from the registered owner "as is where is" so to speak and only need a valid sales agreement registered at the land office. If this was unregistered new construction, then the building permit would be of more importance.The land is a separate issue.

not always. currently many constructions are due for demolition because they were different to the approved p-lans and have ( for example) been foound to be blocking water courses needed in flooding.

VERY important to have a paper trail. property deed plus planning approval equals peace of mind. yes house book is of course vital but only refers to a "building and number" not the design

[Guderian]

Technically its an illegal build and demolition could be ordered without guarantee of the ability to rebuild anything.

If the BP issue isn't sorted by her before sale you are buying the potential problem.

If its so easy she can (and for your purposes, should) get it done before sale.

She's apparently not had any issues in 22 years but you aren't her and its up to you to assess the risk.

Yes, that's the way my lawyer explained it. The owner has to get the matter sorted out before I pay her anything. If Pattaya City Hall decides to demolish it when she shows them that it has been built illegally, then that is not my problem. I'm just wondering if the end-result of all this, although apparently legal, will potentially have any other problems?

[LennyW]

If the house is 22 years old i am quite surprised there is a building permit at all. I think you are making an unnecessary mouintain out of a molehill, InterestedObserver is spot on....

The building permit is only used to get the house owner registered the first time and get a housebook issued. Thereafter you are buying from the registered owner "as is where is" so to speak and only need a valid sales agreement registered at the land office. If this was unregistered new construction, then the building permit would be of more importance.

The more you talk to the lawyer and Land office etc about your "concerns" the more opportunity they have to extract baht!!

[InterestedObserver]

An amended building permit for a 22 year old structure????

[Guderian]

An amended building permit for a 22 year old structure????

Yes, that does make me wonder.

[thaiwanderer]

Technically its an illegal build and demolition could be ordered without guarantee of the ability to rebuild anything.

If the BP issue isn't sorted by her before sale you are buying the potential problem.

If its so easy she can (and for your purposes, should) get it done before sale.

She's apparently not had any issues in 22 years but you aren't her and its up to you to assess the risk.

Yes, that's the way my lawyer explained it. The owner has to get the matter sorted out before I pay her anything. If Pattaya City Hall decides to demolish it when she shows them that it has been built illegally, then that is not my problem. I'm just wondering if the end-result of all this, although apparently legal, will potentially have any other problems?

Not sure what you mean by potentially having any other problems - does it need anymore?

If you buy without it being sorted and the problem arises you may have to pay for the demolition, may not be able to rebuild anything and will have land worth very little compared to what you've paid.

The other potential problem might depend on whether you will be holding the land via an illegal structure?

Edited November 7, 2011 by thaiwanderer

[Guderian]

If the house is 22 years old i am quite surprised there is a building permit at all. I think you are making an unnecessary mouintain out of a molehill, InterestedObserver is spot on....

The building permit is only used to get the house owner registered the first time and get a housebook issued. Thereafter you are buying from the registered owner "as is where is" so to speak and only need a valid sales agreement registered at the land office. If this was unregistered new construction, then the building permit would be of more importance.

The more you talk to the lawyer and Land office etc about your "concerns" the more opportunity they have to extract baht!!

That may be true, but I would be silly to pay a lawyer and then disregard his advice, unless I had some cast-iron reassurance that it was unnecessary. As it's his cock-up, the owner will have to pay for all the paperwork to be put right. So I don;t see any reason not to do it 'properly'.

[thaiwanderer]

If the house is 22 years old i am quite surprised there is a building permit at all. I think you are making an unnecessary mouintain out of a molehill, InterestedObserver is spot on....

There is a building permit as per the OP, its just that its wrong.

Even with an older building - current zoning might affect it.

Anyone here successfully got a correct BP retrospectively?

[Guderian]

If the house is 22 years old i am quite surprised there is a building permit at all. I think you are making an unnecessary mouintain out of a molehill, InterestedObserver is spot on....

There is a building permit as per the OP, its just that its wrong.

Even with an older building - current zoning might affect it.

Anyone here successfully got a correct BP retrospectively?

The zoning isn't a problem as it's in a long-established village.

I'm not concerned about getting the BP retrospectively, that's the current owner's problem AFAIAC. Several people have told me that it's fairly routine in Pattaya.

I'm just concerned that, if and when it is all done and dusted, am I missing something that might come back and bite me? If I wanted to sell on in the future, say 10 years from now, and it was clear that the building was 32 years old rather than 10, I'd be perfectly open about why there was a discrepancy, but would it be a show stopper? Who knows how rules may change here in the future?

The lawyers know their stuff on the legal structure issue, and it will all be done according to the current letter of the law.

[LennyW]

I'm just concerned that, if and when it is all done and dusted, am I missing something that might come back and bite me? If I wanted to sell on in the future, say 10 years from now, and it was clear that the building was 32 years old rather than 10, I'd be perfectly open about why there was a discrepancy, but would it be a show stopper? Who knows how rules may change here in the future?

How would you react if you were going to buy a 10 year old house on paper and you found out it was 32 years old?

Some people may listen to an explanation of the discrepancy on paper but i suspect most would run away!!

Tricky one....

[Guderian]

I'm just concerned that, if and when it is all done and dusted, am I missing something that might come back and bite me? If I wanted to sell on in the future, say 10 years from now, and it was clear that the building was 32 years old rather than 10, I'd be perfectly open about why there was a discrepancy, but would it be a show stopper? Who knows how rules may change here in the future?

How would you react if you were going to buy a 10 year old house on paper and you found out it was 32 years old?

Some people may listen to an explanation of the discrepancy on paper but i suspect most would run away!!

Tricky one....

Indeed, that's what worries me.

[janverbeem]

If the house is 22 years old i am quite surprised there is a building permit at all. I think you are making an unnecessary mouintain out of a molehill, InterestedObserver is spot on....

There is a building permit as per the OP, its just that its wrong.

Even with an older building - current zoning might affect it.

Anyone here successfully got a correct BP retrospectively?

The zoning isn't a problem as it's in a long-established village.

I'm not concerned about getting the BP retrospectively, that's the current owner's problem AFAIAC. Several people have told me that it's fairly routine in Pattaya.

I'm just concerned that, if and when it is all done and dusted, am I missing something that might come back and bite me? If I wanted to sell on in the future, say 10 years from now, and it was clear that the building was 32 years old rather than 10, I'd be perfectly open about why there was a discrepancy, but would it be a show stopper? Who knows how rules may change here in the future?

The lawyers know their stuff on the legal structure issue, and it will all be done according to the current letter of the law.

Whenever you sell your house in the future I assume you will tell the buyer when it was built.Would also be logical as most people will see the difference between a 32 year old house versus a 10 year old.

Very little buyers however will take notice,and be concerned, at which date the building license was handed.

[thaiwanderer]

AFAIK the building permit cannot be legitimately issued retrospectively.

It is a permission to build, not a declaration that although the existent building didn't have permission 22 years ago now the official finds that it is legal and sanctions its continuing existence.

That's not to say in reality a building permit cannot necessarily be obtained now (with essentially false details) but no liability attaches to the mistake of an official (here, in issuing it) and future officials may have different attitudes to current incumbents.

Sure, if it can be obtained then its better than not (and should be done before the purchase) but IMHO it provides no real protection should a problem arise.

There may never be a problem and a future purchaser on re-sale may be unconcerned but a new permit for an old building doesn't cleanse it.

Physically the property may be ideal but its legal status cannot be ignored when comparing it to other properties with no such problems - evaluating the scale of that disadvantage is obviously a matter for the OP - if still wishing to proceed I'd be looking at negotiating a healthy discount.

Also I would not rely on the existence and appearance of neighbouring properties as proof of compliance with zoning.

OT - how is the property holding up after 22 years?

[InterestedObserver]

Whose to say the structure was not built 22 years ago according to the original building permit. To try and get a new building permit dated 2011, or even postdated 22years, and reflecting the current design could, in my opinion, lead to fraud. The house is 22 years old, end of story.

[Guderian]

AFAIK the building permit cannot be legitimately issued retrospectively.

It is a permission to build, not a declaration that although the existent building didn't have permission 22 years ago now the official finds that it is legal and sanctions its continuing existence.

That's not to say in reality a building permit cannot necessarily be obtained now (with essentially false details) but no liability attaches to the mistake of an official (here, in issuing it) and future officials may have different attitudes to current incumbents.

Sure, if it can be obtained then its better than not (and should be done before the purchase) but IMHO it provides no real protection should a problem arise.

There may never be a problem and a future purchaser on re-sale may be unconcerned but a new permit for an old building doesn't cleanse it.

Physically the property may be ideal but its legal status cannot be ignored when comparing it to other properties with no such problems - evaluating the scale of that disadvantage is obviously a matter for the OP - if still wishing to proceed I'd be looking at negotiating a healthy discount.

Also I would not rely on the existence and appearance of neighbouring properties as proof of compliance with zoning.

OT - how is the property holding up after 22 years?

It's in excellent shape. When I first looked at it I didn't realise how old it was, but the owner said that he'd been living there for over 20 years and that matches the dates on the permit. Of course, I was going to have a structural survey carried out before committing myself.

I have thought about trying to negotiate a discount, but have a few reservations there. So far, discussions have been very friendly, and we have already agreed a 20% discount compared to the asking price. Given the size of the place and its location (300 sqm in central Pattaya) it already looks to me to be very cheap. Trying to push the owner down further may simply antagonise the owner, so that the house may not be left in quite such a nice condition. Then of course there's the question of what will happen in future? If I wanted to sell it in 10 years time and the rules had changed, would it make much difference that I couldn't sell (say) a 5 million Baht house instead of not being able to sell a 6 million Baht house?

[Guderian]

Whose to say the structure was not built 22 years ago according to the original building permit. To try and get a new building permit dated 2011, or even postdated 22years, and reflecting the current design could, in my opinion, lead to fraud. The house is 22 years old, end of story.

The house is 22 years old and, according to the structure that is described on the building permit, it was built illegally. Presumably that was an honest mistake, as I am told that Pattaya 22 years ago was a much less organised town with far less bureaucracy, so people didn't worry too much about all the details. I don't know if that's true or not?

[thaiwanderer]

Whose to say the structure was not built 22 years ago according to the original building permit. To try and get a new building permit dated 2011, or even postdated 22years, and reflecting the current design could, in my opinion, lead to fraud. The house is 22 years old, end of story.

The house is 22 years old and, according to the structure that is described on the building permit, it was built illegally. Presumably that was an honest mistake, as I am told that Pattaya 22 years ago was a much less organised town with far less bureaucracy, so people didn't worry too much about all the details. I don't know if that's true or not?

Everything's relative!

Getting a building permit and then not building in accordance with it may have been an oversight / a bit tardy .......or the actual build might never have been able to get approved.

As I said earlier compliance with zoning shouldn't be assumed.

[InterestedObserver]

Whose to say the structure was not built 22 years ago according to the original building permit. To try and get a new building permit dated 2011, or even postdated 22years, and reflecting the current design could, in my opinion, lead to fraud. The house is 22 years old, end of story.

The house is 22 years old and, according to the structure that is described on the building permit, it was built illegally. Presumably that was an honest mistake, as I am told that Pattaya 22 years ago was a much less organised town with far less bureaucracy, so people didn't worry too much about all the details. I don't know if that's true or not?

Everything's relative!

Getting a building permit and then not building in accordance with it may have been an oversight / a bit tardy .......or the actual build might never have been able to get approved.

As I said earlier compliance with zoning shouldn't be assumed.

What zoning in Pattaya 22 years ago. Any current zoning laws would not have been applied retroactively.

[PattayaParent]

Whose to say the structure was not built 22 years ago according to the original building permit. To try and get a new building permit dated 2011, or even postdated 22years, and reflecting the current design could, in my opinion, lead to fraud. The house is 22 years old, end of story.

The house is 22 years old and, according to the structure that is described on the building permit, it was built illegally. Presumably that was an honest mistake, as I am told that Pattaya 22 years ago was a much less organised town with far less bureaucracy, so people didn't worry too much about all the details. I don't know if that's true or not?

If it gets resolved to your satisfaction and you go ahead with the purchase then I would suggest if you are looking to sell in the future you provide the purchaser the original Building Permit along with the new BP and an explanation of the reasons why there are 2 documents to prevent any possibility of a claim of fraud.

[thaiwanderer]

Whose to say the structure was not built 22 years ago according to the original building permit. To try and get a new building permit dated 2011, or even postdated 22years, and reflecting the current design could, in my opinion, lead to fraud. The house is 22 years old, end of story.

The house is 22 years old and, according to the structure that is described on the building permit, it was built illegally. Presumably that was an honest mistake, as I am told that Pattaya 22 years ago was a much less organised town with far less bureaucracy, so people didn't worry too much about all the details. I don't know if that's true or not?

Everything's relative!

Getting a building permit and then not building in accordance with it may have been an oversight / a bit tardy .......or the actual build might never have been able to get approved.

As I said earlier compliance with zoning shouldn't be assumed.

What zoning in Pattaya 22 years ago. Any current zoning laws would not have been applied retroactively.

There was zoning / restrictions then. Later development of the regulations may also apply retrospectively (especially for illegal builds such as this).

[Guderian]

There was zoning / restrictions then. Later development of the regulations may also apply retrospectively (especially for illegal builds such as this).

I'm not concerned about zoning, it's in a residential area of the town. There are literally thousands of houses around it.

[Guderian]

Whose to say the structure was not built 22 years ago according to the original building permit. To try and get a new building permit dated 2011, or even postdated 22years, and reflecting the current design could, in my opinion, lead to fraud. The house is 22 years old, end of story.

The house is 22 years old and, according to the structure that is described on the building permit, it was built illegally. Presumably that was an honest mistake, as I am told that Pattaya 22 years ago was a much less organised town with far less bureaucracy, so people didn't worry too much about all the details. I don't know if that's true or not?

If it gets resolved to your satisfaction and you go ahead with the purchase then I would suggest if you are looking to sell in the future you provide the purchaser the original Building Permit along with the new BP and an explanation of the reasons why there are 2 documents to prevent any possibility of a claim of fraud.

Fair point.

I've spoken to another lawyer who tells me that this sort of problem with the BP is quite common in Pattaya. He said that he deals on average with around 4 cases a year, and he has never had a problem getting a new BP issued. Apparently City Hall has no problem with this, it's routine here. He said that there is no under-the-table payment to officials necessary.

[katabeachbum]

Whose to say the structure was not built 22 years ago according to the original building permit. To try and get a new building permit dated 2011, or even postdated 22years, and reflecting the current design could, in my opinion, lead to fraud. The house is 22 years old, end of story.

The house is 22 years old and, according to the structure that is described on the building permit, it was built illegally. Presumably that was an honest mistake, as I am told that Pattaya 22 years ago was a much less organised town with far less bureaucracy, so people didn't worry too much about all the details. I don't know if that's true or not?

If it gets resolved to your satisfaction and you go ahead with the purchase then I would suggest if you are looking to sell in the future you provide the purchaser the original Building Permit along with the new BP and an explanation of the reasons why there are 2 documents to prevent any possibility of a claim of fraud.

Fair point.

I've spoken to another lawyer who tells me that this sort of problem with the BP is quite common in Pattaya. He said that he deals on average with around 4 cases a year, and he has never had a problem getting a new BP issued. Apparently City Hall has no problem with this, it's routine here. He said that there is no under-the-table payment to officials necessary.

if a new buildingpermit is issued according to what is actually build on the property, a new Tabien Baan (new house number) should also be issued as proof of completion of this structure. Issuing a new Tabien Baan automaticly records number of approved sqm and floors

I would assume in this case a buildingpermit is issued for the extensions (presently illegal parts) of old house, and then old Tabien Baan should be used, but sqm and floors info updated

any part of a building, or the whole building, can be demanded demolished if it is higher than approved or larger than approved, or to close to any setback

the number of sqm registered in buildingpermit/Tabien Baan determines minimum accepted transfer value at land office

Pattay as most build up areas had setback and height rules 22 years ago

[InterestedObserver]

There was zoning / restrictions then. Later development of the regulations may also apply retrospectively (especially for illegal builds such as this).

Are you suggesting that at some point in time a "long-established village" was not zoned for residential construction. A building permit was issued for a house and a think everybody can agree that a house was built. Building permit details aside, a house is a house and there is nothing said by the OP to suggest otherwise.

[thaiwanderer]

There was zoning / restrictions then. Later development of the regulations may also apply retrospectively (especially for illegal builds such as this).

Are you suggesting that at some point in time a "long-established village" was not zoned for residential construction. A building permit was issued for a house and a think everybody can agree that a house was built. Building permit details aside, a house is a house and there is nothing said by the OP to suggest otherwise.

Long established now or 22 years ago? Its not clear.

Who says the entire village falls within the same zone / restrictions?

I'm not suggesting its not a house (if it wasn't that might be another problem!) but residential zoning need not allow any house.

Even with a building permit that matches the actual house, compliance with zoning should not be assumed.

[PattayaParent]

If it gets resolved to your satisfaction and you go ahead with the purchase then I would suggest if you are looking to sell in the future you provide the purchaser the original Building Permit along with the new BP and an explanation of the reasons why there are 2 documents to prevent any possibility of a claim of fraud.

Fair point.

I've spoken to another lawyer who tells me that this sort of problem with the BP is quite common in Pattaya. He said that he deals on average with around 4 cases a year, and he has never had a problem getting a new BP issued. Apparently City Hall has no problem with this, it's routine here. He said that there is no under-the-table payment to officials necessary.

Then if you have all the documentation as I suggest it should be no problem for the lawyer of any future purchaser to assure him that everything is in order.

Edit: it's only fraud if you deliberately misrepresent the facts, if you declare the true age of the property you would be OK.

Edited November 8, 2011 by PattayaParent

[Guderian]

One other thing I forgot to mention, and I'm not sure if it has a bearing, is that according to the paperwork the house was built with a mortgage from a bank here. Isn't it a bit strange that a bank would lend money to build an illegal structure? Or was that common practice pre-1997?