Today's SMH (26 Nov) - Eviction threat for Australians who put life savings into Thai dream homes

[KittenKong]

Brits wouldn't do anything like this...

Most of the biggest crooks in Thailand are not Thai at all, and many of them are involved in real estate. Also "financial advice" and/or publishing and/or legal work.

[steelepulse]

@kittenkong: if I understand this case correct than this has nothing to do that a foreigner cannot own land. It appears that the developer went bankrupt and obviously all downpayments made and any loans from the bank and others to this developer are now at risk of being lost. This can happen with a downpayment on a condo developer as well. And not only in Thailand but in any country.

Even here developers are supposed to have bank guarantees and insurance to cover this possibility. In the EU they certainly do and the solicitors/lawyers involved in such a purchase there would be responsible for assuring that everything was in order, and their own liability insurance should cover any error on their part.

Of course in Thailand it may well be that the insurance and guarantees were never obtained at all and the entire thing is just a scam. It certainly would not be the first time it has happened. All the more reason only to pay very small deposits, if any.

But I would not like to be in the position of trying to explain to a Thai court that I wanted compensation for money I had lost trying to buy a house and land that I cannot legally own. For an off-plan condo purchase I would feel much happier.

Here's a couple points to rebut:

I've never heard nor seen of a developer in Phuket having insurance available for investors in a project. What insurance company would underwrite this?

The punter in the story has a Thai wife, so no reason she can't own the land, assuming the funds were hers ( cough cough) as in most property purchases by Thai wives.

A few more glaring problems:

90 year leases are in fact, not legit.

Lawyers can be bought here, so even if he paid them to do due diligence, doesn't mean the other side paid more for said due diligence. Caveat Emptor here on all significant transactions is probably sage advice.

[surangw]

you can't own a dream.

[useronthenet]

Countless of warnings and articles on the subject of the risks and pitfalls of buying property in Thailand, especially if your a foreigner.

[NeverSure]

Tawan was a bunch of English guys from Hong Kong. Many bad stories have emerged about them. Even their boat charter business had really dubious activities.

Best stay clear of them.

Brits wouldn't do anything like this... there had to be Thais involved.

"Brits wouldn't do anything like this... there had to be Thais Burmese involved."

[NeverSure]

to be honest it's not such an uncommon event that a property developer goes bankrupt before the development is finished. I've seen this happening in Europe, in the US and even in Japan. I'm sure it happens in Australia as well. And every time this happens you have people who loose money, be it private investors, banks or others.

-snip-

Not quite. In the US it is illegal for the developer to accept the money before the project is complete and signed off by the relative government agency.

"Earnest money" can be paid by the buyer but it must go into escrow with a neutral, licensed escrow company. A title search is done to find any liens. If the project isn't completed as agreed, the buyer gets his money back from the escrow company.

When the buyer's money does go to the developer, a title insurance company does a title search and issues insurance on that title. If it turns out that the title insurance company missed finding a prior lien or other encumbrance, they have the option of paying off the lien or refunding the purchase price and taking ownership themselves. Then they have to clear the liens.

This is Kansas and every state, Dorothy.

Never buy a dimn thing in Thailand except a sammich.

[davidsuphan]

If something seem's to good to be true, it probably is!.

[KittenKong]

Here's a couple points to rebut:

I've never heard nor seen of a developer in Phuket having insurance available for investors in a project. What insurance company would underwrite this?

Developers in Pattaya advertise themselves as having bank guarantees and insurance, and as far as I know this is a legal requirement following previous scandals and losses. I see no reason why such cover should not be available in Phuket, at a price.

The punter in the story has a Thai wife, so no reason she can't own the land, assuming the funds were hers ( cough cough) as in most property purchases by Thai wives.

A few more glaring problems:

90 year leases are in fact, not legit.

Lawyers can be bought here, so even if he paid them to do due diligence, doesn't mean the other side paid more for said due diligence.

All reasons that can be assimilated into my general warning of not trying to buy something you cant legally own, I think.

The only property a farang can legally own here is a condo, and I think that's what sensible people should stick to. Even a legal 30 year lease is not what I would describe as "ownership" as there is a good chance that many buyers would outlive such a lease.

[KittenKong]

If something seem's to good to be true, it probably is!.

The prices that the leases to these places were being sold at didnt look like an impossibly good bargain to me. In fact they looked rather expensive. This is what may have duped some buyers into parting with their money in the first place.

[Valentine]

meanwhile the developer sits in his million dollar mansion saying it is not prudent to come back to Thailand. Perhaps the owners should file a class action suit although not sure if that would be grounds for extradition.

[KarenBravo]

Banging on about "not being able to own land, never buy, always rent", is throwing the baby out with the bath-water.

The error here was the route they chose to get their dream-house.

I own a dream-house, but, I went by a different route, buying the land through the missus (that I've been with for 17 years),

designing the house and having it built.

Many other house owners are very happy with their lot. Pride of ownership, no rent and capital appreciation being part of it.

The development company was the fault, not the decision to buy.

We don't ban cars because there are car-crashes where people actually get killed, rather than just lose assets.

Edited November 27, 2014 by KarenBravo

[y2k]

Tawan was a bunch of English guys from Hong Kong. Many bad stories have emerged about them. Even their boat charter business had really dubious activities.

Best stay clear of them.

Brits wouldn't do anything like this... there had to be Thais involved.

You wouldn't say that if you'd met Andy Street.

[NamKangMan]

If you want to buy property in Thailand, buy something you can legally own outright: a condo. Otherwise rent.

Anything else could easily come back and bite you in the bum one day, as indeed it may be doing to the misguided people who put money into this development.

I do feel sorry for them but they only have themselves to blame for buying something they cant legally own.

"If you want to buy property in Thailand, buy something you can legally own outright: a condo." - I've heard about these condo's that float in mid air.

[NamKangMan]

Banging on about "not being able to own land, never buy, always rent", is throwing the baby out with the bath-water.

The error here was the route they chose to get their dream-house.

I own a dream-house, but, I went by a different route, buying the land through the missus (that I've been with for 17 years),

designing the house and having it built.

Many other house owners are very happy with their lot. Pride of ownership, no rent and capital appreciation being part of it.

The development company was the fault, not the decision to buy.

We don't ban cars because there are car-crashes where people actually get killed, rather than just lose assets.

"I went by a different route, buying the land through the missus" - solid advice KB.

"Pride of ownership." - building construction is good here, isn't it?

"no rent and capital appreciation being part of it" - good luck trying to sell, to get your "capital appreciation."

[merijn]

Banging on about "not being able to own land, never buy, always rent", is throwing the baby out with the bath-water.

The error here was the route they chose to get their dream-house.

I own a dream-house, but, I went by a different route, buying the land through the missus (that I've been with for 17 years),

designing the house and having it built.

Many other house owners are very happy with their lot. Pride of ownership, no rent and capital appreciation being part of it.

The development company was the fault, not the decision to buy.

We don't ban cars because there are car-crashes where people actually get killed, rather than just lose assets.

I'm in the same position.

When we where interested in a new house we visited several projects but decided not to do as it in my opinion way to expensive for what you get and there is not much guarantee.

We bought the land our self (in my wife name) and designed and build the house according our own wishes.

Off course i can have problems as the land in my wife name but after 25 years together there is no more risk involved as i would be married in the UK for example.

[pagallim]

NKM doesn't seem to grasp that if you have a registered Thai marriage (not the Monk blessing and string around the wrist variety), in the event of subsequent divorce, it's the norm that all property/assets obtained during the period of the marriage are divided 50/50 (unless there is a pre-nuptual agreement or a private settlement is reached).

[KarenBravo]

Banging on about "not being able to own land, never buy, always rent", is throwing the baby out with the bath-water.

The error here was the route they chose to get their dream-house.

I own a dream-house, but, I went by a different route, buying the land through the missus (that I've been with for 17 years),

designing the house and having it built.

Many other house owners are very happy with their lot. Pride of ownership, no rent and capital appreciation being part of it.

The development company was the fault, not the decision to buy.

We don't ban cars because there are car-crashes where people actually get killed, rather than just lose assets.

I'm in the same position.

When we where interested in a new house we visited several projects but decided not to do as it in my opinion way to expensive for what you get and there is not much guarantee.

We bought the land our self (in my wife name) and designed and build the house according our own wishes.

Off course i can have problems as the land in my wife name but after 25 years together there is no more risk involved as i would be married in the UK for example.

I also trust my wife, but, I still have a 30 year lease under my own name.

[NamKangMan]

NKM doesn't seem to grasp that if you have a registered Thai marriage (not the Monk blessing and string around the wrist variety), in the event of subsequent divorce, it's the norm that all property/assets obtained during the period of the marriage are divided 50/50 (unless there is a pre-nuptual agreement or a private settlement is reached).

I think I have a good "grasp" of it, pags.

You put in 100%, and if you don't "suicide" before your divorce, you walk away with 50%.

Sounds like a solid investment in one's future in Thailand.

[stuarty]

I also trust my wife, but, I still have a 30 year lease under my own name.


Haaahahhahahhhahahahhhahaaaahaha!!! Good one. Priceless.

[pagallim]

NKM doesn't seem to grasp that if you have a registered Thai marriage (not the Monk blessing and string around the wrist variety), in the event of subsequent divorce, it's the norm that all property/assets obtained during the period of the marriage are divided 50/50 (unless there is a pre-nuptual agreement or a private settlement is reached).

I think I have a good "grasp" of it, pags.

You put in 100%, and if you don't "suicide" before your divorce, you walk away with 50%.

Sounds like a solid investment in one's future in Thailand.

In most of our countries of origin, it's the norm that (without being sexist) the husband financially contributes to the family home purchase to a far greater (if not wholly) degree than the wife. That's also not usually reflected in divorce proceedings, where a 50% asset recovery would be considered a 'win'.

Back to the OP, it's my understanding that in these cases, monies were parted with (in total, the full amount not only deposits or stage payments) without land registration taking place in favour of the purchasers. Whilst sorry that anyone should suffer loss in these circumstances, there's a whiff of gullability that's proved an expensive lesson.

[LivinginKata]

NKM doesn't seem to grasp that if you have a registered Thai marriage (not the Monk blessing and string around the wrist variety), in the event of subsequent divorce, it's the norm that all property/assets obtained during the period of the marriage are divided 50/50 (unless there is a pre-nuptual agreement or a private settlement is reached).

I think I have a good "grasp" of it, pags.

You put in 100%, and if you don't "suicide" before your divorce, you walk away with 50%.

Sounds like a solid investment in one's future in Thailand.

Ok NKM, I will take your bait ...

I was married for 15 years in the UK. Got divorced, wife got half the house and assets, plus a monthly allowance.

So what's the difference with my Thai wife of nearly 19 years. She holds land/houses in her own name and our company holds land/house (2 other chanotes) in the company name. I accept she should get half if we divorce. And your 'suicide' idea is not unique to Thailand. Lighten up NKM.

[Robert24]

meanwhile the developer sits in his million dollar mansion saying it is not prudent to come back to Thailand. Perhaps the owners should file a class action suit although not sure if that would be grounds for extradition.

well assuming the property developer was a private ltd company, he is only liable with all the assets and capital in the company. His personal assets are protected in case of bankruptcy of his business. I don't know this case in detail but just reading this news article, it sounds just like a company went bankrupt and creditors are now in court battling who will get how much from what is left.

Such comments make it sound like there was a scam and cheating involved (although from the news article there is no indication about this). If so that would be a criminal offense that would have to be investigated and if proved so, creditors could sue the individual as well in a civil case to recover their losses.

[Robert24]

If something seem's to good to be true, it probably is!.

The prices that the leases to these places were being sold at didnt look like an impossibly good bargain to me. In fact they looked rather expensive. This is what may have duped some buyers into parting with their money in the first place.

I agree with Kittenkong on this. 14 million baht down payment on a 90 year lease for a 3 bedroom property doesn't sound like "too good to be true". This sounds like "Way too expensive to buy".

Does anyone know how much the total price of the property was?

[stevenl]

If something seem's to good to be true, it probably is!.

The prices that the leases to these places were being sold at didnt look like an impossibly good bargain to me. In fact they looked rather expensive. This is what may have duped some buyers into parting with their money in the first place.

I agree with Kittenkong on this. 14 million baht down payment on a 90 year lease for a 3 bedroom property doesn't sound like "too good to be true". This sounds like "Way too expensive to buy".

Does anyone know how much the total price of the property was?

Judging from the article they have paid in full, so total price was 14 million.

[KittenKong]

Banging on about "not being able to own land, never buy, always rent", is throwing the baby out with the bath-water.

Not really. It may act as a warning to others that may prevent them from making the same mistake, in which case it will have been worth the effort.

I own a dream-house, but, I went by a different route, buying the land through the missus (that I've been with for 17 years),

designing the house and having it built.

If you used your money to buy the land then you probably broke the law. Your decision, of course, but I prefer not to. And you dont own the land: at best you own half of it or maybe none of it. Good luck trying to move the house you own if you have legal problems with the land it is on.

We don't ban cars because there are car-crashes where people actually get killed, rather than just lose assets.

We may not ban cars but in most sensible countries an attempt is made to make cars and their drivers as safe as possible, by insisting on periodic vehicle checks, driving tests, airbags, seat belts, speed limits, drink-driving rules etc.

Farangs buying houses here is like driving a car with no brakes: probably dangerous and probably illegal.

[cgphuket]

When you got big money to throw around in Thailand, you got big money to lose. No tears please, just go home.

[NamKangMan]

NKM doesn't seem to grasp that if you have a registered Thai marriage (not the Monk blessing and string around the wrist variety), in the event of subsequent divorce, it's the norm that all property/assets obtained during the period of the marriage are divided 50/50 (unless there is a pre-nuptual agreement or a private settlement is reached).

I think I have a good "grasp" of it, pags.

You put in 100%, and if you don't "suicide" before your divorce, you walk away with 50%.

Sounds like a solid investment in one's future in Thailand.

Ok NKM, I will take your bait ...

I was married for 15 years in the UK. Got divorced, wife got half the house and assets, plus a monthly allowance.

So what's the difference with my Thai wife of nearly 19 years. She holds land/houses in her own name and our company holds land/house (2 other chanotes) in the company name. I accept she should get half if we divorce. And your 'suicide' idea is not unique to Thailand. Lighten up NKM.

There are obviously many variables to a mrriage split, anywhere in the world. Eg. who bought what into the relationship, are there children involved, what assets were accumulated throughout the marriage etc etc etc etc.

In general, if one party in the marriage had no assets, and the other party put in everything, if divorce followed shortly after being married, and no children were involved, the party who contributed the most assets to the partnership will walk away with the most assets from the divorce.

Being married for 19 years, obviously, you have a stable marriage, and good luck to you, and others in a similar position. I wish you every happiness.

However, I was referring to a lot of marriages here where the Thai lady puts on a great "acting perfomance" until she has enough assets, or the foreigners money dries up, and then she wants out. In the west, the colloquial term used to describe such a women is, "gold digger."

So, they marry, he buys a property, and soon after they divorce. She gets 50% and they may have only been married for a short time. Another nice little earner for the her, and the Thai family.

My post was more referring to the many foreigners who come here and lose touch with reality, the ones that really do believe they are "young and handsome." It was not directed at ALL mixed marriages here.

In relation to the "suicide" comment in my previous post, I was referring to throwing someone off a balcony, or kicking them off their motorbike on a quiet road at night and then killing them - making look like a motor vehicle accident, or they stab themself to death, or hang themself with a piece of string etc etc which converts a divorce return of only 50% into receiving 100% of assets, upon the death of their spouse.

Some may think I have a vivid imagination, but I would challenge anyone to say this has never happened here.

I am "light" LIK. I have a lot less "baggage" than you here. Just the way I like it.

Edited November 28, 2014 by NamKangMan