House in a company name with Thai nominees

[dimok]

when a company and its assets are sold the land office does not get involved. that also applies if and when the company is dissolved. only after closing down the company the land office joins the party when the new owner transfers the chanote in his name.

The company can't get closed before the land has been transferred to a new owner. You can't close down a company that has assets.

Hello! Can anybody answer on more difficult question - wha will be solution in the case if company made leasehold on person and holding chanot with leasehold. company is abandoned by any reason - for example all shareholders died in one day). So it need to be closed by goverment, because nobody doesn;t support accountant etc, from another side it is holding chanot, and as i know it is impossible to transfer chanot with active leasehold - Land office refuse such transfers.

What will be in this situation. Holder of leasehold is safe?

[AnotherOneAmerican]

Off topic

It would be interesting to get some ideas about the foreigners who own a house (under whatever umbrella) in Thailand Vs the foreigners who paid for a house and suffered total loss in Thailand.

I know of about 12 'losses' Vs 3 'still haves' (plus two half losses).

Most of the cases involved nominee purchases with Thai partners, two involved foreigners with a lease.

Edited April 25, 2014 by AnotherOneAmerican

[Naam]

Off topic

It would be interesting to get some ideas about the foreigners who own a house (under whatever umbrella) in Thailand Vs the foreigners who paid for a house and suffered total loss in Thailand.

I know of about 12 'losses' Vs 3 'still haves' (plus two half losses).

Most of the cases involved nominee purchases with Thai partners, two involved foreigners with a lease.

please define "how you know" about these losses.

[AnotherOneAmerican]

Friends and acquaintances who told me of their loss and how it happened. Losses include an

American couple (lease), English lady (lease), nominee wife/gf several Germans, Norweigan, Frenchman, three Brits, Canadian.

Some of them lost more than one property.

I also know of at least 6 business total losses in CM, purchased by foreigner, run by wife/gf.

Edited April 25, 2014 by AnotherOneAmerican

[Naam]

Friends and acquaintances who told me of their loss and how it happened. Losses include an

American couple (lease), English lady (lease), nominee wife/gf several Germans, Norweigan, Frenchman, three Brits, Canadian.

Some of them lost more than one property.

I also know of at least 6 business total losses in CM, purchased by foreigner, run by wife/gf.

in what way are "leases" connected to "houses in a company name"? land leased by a "lease contract, usufruct or superficies" in order to build a property in your name on it these are mentioned as a liability (similiar to mortgage) in the chanote of which you get a certified copy plus you have the lease contract. then nobody can take/steal that property.

a different ball game is when the land is in the name of a Thai wife, girl/boyfriend et al, the chanote is blank and you have no legal document to protect your rights.

[manarak]

It's an easy math:

Keep the property for about 14 years and the saved rents will exceed the initial value of the property plus interest. Anything longer is pure profit.

[JesseFrank]

Friends and acquaintances who told me of their loss and how it happened. Losses include an

American couple (lease), English lady (lease), nominee wife/gf several Germans, Norweigan, Frenchman, three Brits, Canadian.

Some of them lost more than one property.

I also know of at least 6 business total losses in CM, purchased by foreigner, run by wife/gf.

in what way are "leases" connected to "houses in a company name"? land leased by a "lease contract, usufruct or superficies" in order to build a property in your name on it these are mentioned as a liability (similiar to mortgage) in the chanote of which you get a certified copy plus you have the lease contract. then nobody can take/steal that property.

a different ball game is when the land is in the name of a Thai wife, girl/boyfriend et al, the chanote is blank and you have no legal document to protect your rights.

Unless you lease the land from a company ltd which is clearly set up to own the land, which is illegal. They can close down the company and void any contracts made by that illegal company.

[JesseFrank]

It's an easy math:

Keep the property for about 14 years and the saved rents will exceed the initial value of the property plus interest. Anything longer is pure profit.

So lets say I pay cash for a 10 million Baht property. That 10 million Baht invested would deliver me interest, of course it is debatable how much interest, with which I could pay the rent of a house.

After 14 years I would still have the 10 Million.................maybe a lot more

[SheungWan]

It's an easy math:

Keep the property for about 14 years and the saved rents will exceed the initial value of the property plus interest. Anything longer is pure profit.

So lets say I pay cash for a 10 million Baht property. That 10 million Baht invested would deliver me interest, of course it is debatable how much interest, with which I could pay the rent of a house.

After 14 years I would still have the 10 Million.................maybe a lot more

At an interest rate of 5% reinvested over a period of 14 years your 10 million will have almost doubled.

[Naam]

It's an easy math:

Keep the property for about 14 years and the saved rents will exceed the initial value of the property plus interest. Anything longer is pure profit.

So lets say I pay cash for a 10 million Baht property. That 10 million Baht invested would deliver me interest, of course it is debatable how much interest, with which I could pay the rent of a house.

After 14 years I would still have the 10 Million.................maybe a lot more

At an interest rate of 5% reinvested over a period of 14 years your 10 million will have almost doubled.

and during these 14 years he saves on paying rent by living under a bridge

[Naam]

It's an easy math:

Keep the property for about 14 years and the saved rents will exceed the initial value of the property plus interest. Anything longer is pure profit.

So lets say I pay cash for a 10 million Baht property. That 10 million Baht invested would deliver me interest, of course it is debatable how much interest, with which I could pay the rent of a house.

After 14 years I would still have the 10 Million.................maybe a lot more

long term THB interest yields ~4.25%

THB 10,000,000 @ 4.25% = 450,000 p.a

minus 15% flat tax..............= 67,500

net yield.............................= 382,500 p.a.

..........................................= 31,875 month

for THB 32k/month you can't rent a 10 million Baht home.

i humbly apologise for spoiling wet dreams with facts

[AnotherOneAmerican]

It's an easy math:

Keep the property for about 14 years and the saved rents will exceed the initial value of the property plus interest. Anything longer is pure profit.

So lets say I pay cash for a 10 million Baht property. That 10 million Baht invested would deliver me interest, of course it is debatable how much interest, with which I could pay the rent of a house.

After 14 years I would still have the 10 Million.................maybe a lot more

long term THB interest yields ~4.25%

THB 10,000,000 @ 4.25% = 450,000 p.a

minus 15% flat tax..............= 67,500

net yield.............................= 382,500 p.a.

..........................................= 31,875 month

for THB 32k/month you can't rent a 10 million Baht home.

i humbly apologise for spoiling wet dreams with facts

I rented a 1.4M home for 5k a month in CM for a while last year, so by a simple process of multiplication, 32K should get me a 9M house (6.5 x 1.4 = 9). Assuming more expensive houses don't bring bigger rental returns.

Loads of 2.5M houses with an asking rental price of 10k a month around at the moment, so 32k should easily get you an 8M house.

Edited April 27, 2014 by AnotherOneAmerican

[manarak]

The rent for a 10 million THB house is about 75k a month.

Interest on safe investments is around 4%.

Scenario 1: you rent the house and invest 10m @ 4%... after 15 years you have 0 and your landlord kicks you out (this is supposing the rent doesn't increase over the period!)

Scenario 2: you buy the house.

[manarak]

It's an easy math:

Keep the property for about 14 years and the saved rents will exceed the initial value of the property plus interest. Anything longer is pure profit.

So lets say I pay cash for a 10 million Baht property. That 10 million Baht invested would deliver me interest, of course it is debatable how much interest, with which I could pay the rent of a house.

After 14 years I would still have the 10 Million.................maybe a lot more

long term THB interest yields ~4.25%

THB 10,000,000 @ 4.25% = 450,000 p.a

minus 15% flat tax..............= 67,500

net yield.............................= 382,500 p.a.

..........................................= 31,875 month

for THB 32k/month you can't rent a 10 million Baht home.

i humbly apologise for spoiling wet dreams with facts

I rented a 1.4M home for 5k a month in CM for a while last year, so by a simple process of multiplication, 32K should get me a 9M house (6.5 x 1.4 = 9). Assuming more expensive houses don't bring bigger rental returns.

Loads of 2.5M houses with an asking rental price of 10k a month around at the moment, so 32k should easily get you an 8M house.

Nicer houses sure do bring higher rent returns.

The maths isn't obviously the same in areas that are overbuilt with cheap houses.

10m house for about 75k a month here in Patts, I even previously rented out a house I had bought for 8.6 million for 80k a month long term.

In general, 10m houses which don't earn that rent are not that nice, and since tenants cannot improve houses, like extend the pool, I wouldn't like to rent a house which doesn't earn its 8 to 9% rent return.

Edited April 27, 2014 by manarak

[JesseFrank]

It's an easy math:

Keep the property for about 14 years and the saved rents will exceed the initial value of the property plus interest. Anything longer is pure profit.

So lets say I pay cash for a 10 million Baht property. That 10 million Baht invested would deliver me interest, of course it is debatable how much interest, with which I could pay the rent of a house.

After 14 years I would still have the 10 Million.................maybe a lot more

long term THB interest yields ~4.25%

THB 10,000,000 @ 4.25% = 450,000 p.a

minus 15% flat tax..............= 67,500

net yield.............................= 382,500 p.a.

..........................................= 31,875 month

for THB 32k/month you can't rent a 10 million Baht home.

i humbly apologise for spoiling wet dreams with facts

So your money is all in a Thai bank account yielding net 3.62% a year ?

Good to know for next time you come here claiming you made 14.75% YTD, even in these bad times

http://www.thaivisa.com/forum/topic/238057-financial-crisis/?p=7678637

[SheungWan]

The rent for a 10 million THB house is about 75k a month.

Interest on safe investments is around 4%.

Scenario 1: you rent the house and invest 10m @ 4%... after 15 years you have 0 and your landlord kicks you out (this is supposing the rent doesn't increase over the period!)

Scenario 2: you buy the house.

Re Scenario 1: If your rental comes from a separate source other than the $10m, then the $10m will have increased by more than 50% after 15 years.

[Naam]

It's an easy math:

Keep the property for about 14 years and the saved rents will exceed the initial value of the property plus interest. Anything longer is pure profit.

So lets say I pay cash for a 10 million Baht property. That 10 million Baht invested would deliver me interest, of course it is debatable how much interest, with which I could pay the rent of a house.

After 14 years I would still have the 10 Million.................maybe a lot more

long term THB interest yields ~4.25%

THB 10,000,000 @ 4.25% = 450,000 p.a

minus 15% flat tax..............= 67,500

net yield.............................= 382,500 p.a.

..........................................= 31,875 month

for THB 32k/month you can't rent a 10 million Baht home.

i humbly apologise for spoiling wet dreams with facts

So your money is all in a Thai bank account yielding net 3.62% a year ?

Good to know for next time you come here claiming you made 14.75% YTD, even in these bad times

http://www.thaivisa.com/forum/topic/238057-financial-crisis/?p=7678637

my money in my Thai accounts doesn't yield more than peanuts. posting an example to point out your absolute ignorance in financial matters (your posting rent/cash) does not mean i invest in Thailand or in Thai Baht.

update of my YTD:

calculated basis USD 13.72%

calculated basis €UR 12.48%

[Naam]

sorry! double posting.

Edited April 27, 2014 by Naam

[SheungWan]

the decision to invest or not to invest in Thailand must be judged based on individual circumstances and perspectives which differ from person to person.

I think this is often forgotten. One size doesn't always fit all. My own personal opinion is that one should at least separate out property purchase for a home to that of purchase for investment purposes and 'er pay attention to location, location, location if one dives in.

Edited April 27, 2014 by SheungWan

[manarak]

The rent for a 10 million THB house is about 75k a month.

Interest on safe investments is around 4%.

Scenario 1: you rent the house and invest 10m @ 4%... after 15 years you have 0 and your landlord kicks you out (this is supposing the rent doesn't increase over the period!)

Scenario 2: you buy the house.

Re Scenario 1: If your rental comes from a separate source other than the $10m, then the $10m will have increased by more than 50% after 15 years.

You still lose the equivalent of all your financial investment due to the rental after 15 years, and even with compounded intesrest, you still have to make up for likely rent increases.

[Arkady]

"And my 2nd question: in case the government "finds out (I am not sure if one can find out something that is a generally well known fact)" about these "illegal" nominees, what can they do about it? My guess is a small fine? Thanks for any insight into this issue."

Re penalties. You and the Thai nominees can be prosecuted under the 1954 Land Code (max penalty B20,00 fine and/or 2 years in prison) and under the 1999 Foreign Business Act (max penalty B1 million fine and/or 3 years in prison). You all could also be prosecuted under the Penal Code for several counts of providing false information to government officials but I am not sure of the penalties for that. If you were caught, you would be given 6 months to dispose of the land. Failing that the director-general of the Land Dept could seize the property and give it to the Legal Execution Dept to sell at public auction.

Most shell companies set up to own land are also vulnerable to tax inspections where the Revenue Dept might refuse to believe the company really had no business operations and arbitrarily assess back tax plus interest and penalties.

I haven't heard of prosecutions under the Land Code and the FBA for this but some one has got to be the first. I have personally been the victim of a Revenue Dept squeeze for improperly assessed back tax for a small company that cost me B200,000 after negotiation. This latter type of case is fairly common, particularly since the RD has been under great pressure to make up for the shortfall in tax revenue. If your company is a front for illegal foreign land ownership, you obviously don't have the option to appeal.

[JesseFrank]

So your money is all in a Thai bank account yielding net 3.62% a year ?

Good to know for next time you come here claiming you made 14.75% YTD, even in these bad times

http://www.thaivisa.com/forum/topic/238057-financial-crisis/?p=7678637

my money in my Thai accounts doesn't yield more than peanuts. posting an example to point out your absolute ignorance in financial matters (your posting rent/cash) does not mean i invest in Thailand or in Thai Baht.

update of my YTD:

calculated basis USD 13.72%

calculated basis €UR 12.48%

My ignorance ?

I would think it is rather your ignorance, because nobody other than you claimed that somone who invested his 10 million baht instead of putting it in a house would be restricted to a Thai bank account.

[SheungWan]

The rent for a 10 million THB house is about 75k a month.

Interest on safe investments is around 4%.

Scenario 1: you rent the house and invest 10m @ 4%... after 15 years you have 0 and your landlord kicks you out (this is supposing the rent doesn't increase over the period!)

Scenario 2: you buy the house.

Re Scenario 1: If your rental comes from a separate source other than the $10m, then the $10m will have increased by more than 50% after 15 years.

You still lose the equivalent of all your financial investment due to the rental after 15 years, and even with compounded intesrest, you still have to make up for likely rent increases.

The investment gains will be offset by rental payments which I have said comes in from another source, but that $10million is still sitting there at over $15million It is a choice, as would be the choice of buying a property, gaining on not paying rental but not receiving investment income on that $10 million. I made a choice, years ago, neither to buy a property in Thailand for personal use or investment. I guess I could liquidate certain investments and buy a Thai property either now or in the future. I am still inclined not to do so. One of the problems is that there is an of market liquidity when one wants to sell IMHO.

Edited April 27, 2014 by SheungWan

[crazykopite]

Koh Tao is Tor Por Bor land the whole island belongs to the Government yet over the last 10/12 years there has been resorts , hotels , private homes being built all over the island . If the Government were to ever decide to pull the plug on the 1000s of companies set up purely for foreign house ownership they would have to employ vast amounts of individuals to clear all the paperwork involved as well as this the Kingdom would go into recession overnight due to all the foreign owners moving to neighbouring countries that would welcome them with open arms I don’t think that they would be crazy enough to pull such a stunt but as the advert goes “ Amazing Thailand “ so you can never say never.