Lease v Own

[Manassas]

Our residence is in the wife's farm/village up north. As much as we love it, even my wife appreciates getting away. So we are looking for a house (pool villa as they are called) in the Hua Hin area to take advantage of the beaches restaurants etc. It will also allow us to entertain friends and family from BKK on weekends.

There seems to be ample properties on the market and I am reviewing our budget for this purpose. Of course, we will want to rent initially to be sure we like the specific area and neighborhood.

But after doing some research I am hearing about people leasing a house on a long-term basis, rather than purchasing. The idea has some appeal to me. There are the obvious advantages to leasing of not having your money tied up, along with the obvious disadvantage of having limited control over the property.

I'm wondering if anyone out there has tried long-term leasing and how satisfied they might be with the experience. What issues should be considered outside the obvious ones? And specifically, are long-term (multi-year) leases reasonably available? And importantly, how do you find an owner interested in long term leasing? (My experience with agents in LOS has not been that good)

Any wisdom from experience would be greatly appreciated!

[Noi657]

How many years would you want to lease a property? If it's many years, why not just get the house on finance? You'll probably be paying similar payments.

[splitlid]

leasehold or freehold the price will be the same.(usually)

[TenDreams]

Property owners here that rent out their villas will be delighted with the prospect of a long term (multi-year) tenant. It should be easy to find a property to rent for 12 months +.

[fabphil]

lease lease lease....

[KamalaRider]

Leasehold is the same as Chanote (freehold) but with a "minor" distinction, you don't own the land on leasehold but you own the house. Lease is normally 30+30+30 years. Who knows what happens after the first 30 years.

Tear it down after the lease runs out or burn it, your choice.

You can't own land as a person here in LOS with the Chanote title, you have to form a company to be able to do it and then you can only own 49% of the shares in a company, unless you are an american citizen, than 100%.

Price doesn't differ much between the two.

Edited February 5, 2015 by KamalaRider

[angiolo]

do not buy in a Thai name....????? Lose Thai girl and house .You have been warned

[wowfactor10]

Let u Thai wife buy it and let your wife pay for it...

If not buy a condo in your name..

[mike324]

I think it all comes down to how many days / months do you plan on living there, and if you plan on staying 2-3 days vs weeks at a time. I think short-term leasing is better than committing to a long-term lease or buying if you do not plan on going monthly. Leasehold villas are somewhat hard to sell unless you sell at a huge lost if you want to move.

Most of these types of properties are situated in a gated community / development, don't forget to take into consideration yearly maintenance/communal costs if you are looking into long-term leases.

Edited February 5, 2015 by mike324

[stgrhe]

 

Leasehold is the same as Chanote (freehold) but with a "minor" distinction, you don't own the land on leasehold but you own the house. Lease is normally 30+30+30 years. Who knows what happens after the first 30 years.

Tear it down after the lease runs out or burn it, your choice.

You can't own land as a person here in LOS with the Chanote title, you have to form a company to be able to do it and then you can only own 49% of the shares in a company, unless you are an american citizen, than 100%.

Price doesn't differ much between the two.

 

KamalaRider, there are a number of false statements in the post: First, most people who lease land do also lease their house. However, the ownership of the dwelling(s) can be separated from the land, but only if certain procedures are taken. Thus, one doesn't automatically own the house even if the lease contract say so; Secondly, the maximum legal lease period is 30 years, not 30+30+30 as stated. Furthermore, the 30 years lease is only valid if the lease has duly been registered at the land office, else the maximum lease period will be reduced to 3 years irrespectively of what the lease contract says; Thirdly, the 'company route' mentioned is illegal period! Although this is common i Thailand but that does not mean it is legal.

OP, if your wife is Thai, buy the property or settle for a condominium in your name if you are hesitant to buy in your wife's name. If 'she buys' you have better alternative to secure posessory rithts than leasing. A usufruct or a superficies are both much better alternatives than leasing.

I forgot to mention, American citizens may own a company in Thailand 100%, BUT SUCH A COMPANY IS NOT ALLOWED TO PURCHACE LAND!

Edited February 5, 2015 by stgrhe

[Eli1]

 

Leasehold is the same as Chanote (freehold) but with a "minor" distinction, you don't own the land on leasehold but you own the house. Lease is normally 30+30+30 years. Who knows what happens after the first 30 years.

Tear it down after the lease runs out or burn it, your choice.

You can't own land as a person here in LOS with the Chanote title, you have to form a company to be able to do it and then you can only own 49% of the shares in a company, unless you are an american citizen, than 100%.

Price doesn't differ much between the two.

 

KamalaRider, there are a number of false statements in the post: First, most people who lease land do also lease their house. However, the ownership of the dwelling(s) can be separated from the land, but only if certain procedures are taken. Thus, one doesn't automatically own the house even if the lease contract say so; Secondly, the maximum legal lease period is 30 years, not 30+30+30 as stated. Furthermore, the 30 years lease is only valid if the lease has duly been registered at the land office, else the maximum lease period will be reduced to 3 years irrespectively of what the lease contract says; Thirdly, the 'company route' mentioned is illegal period! Although this is common i Thailand but that does not mean it is legal.

OP, if your wife is Thai, buy the property or settle for a condominium in your name if you are hesitant to buy in your wife's name. If 'she buys' you have better alternative to secure posessory rithts than leasing. A usufruct or a superficies are both much better alternatives than leasing.

I forgot to mention, American citizens may own a company in Thailand 100%, BUT SUCH A COMPANY IS NOT ALLOWED TO PURCHACE LAND!

[I say]

Leasehold is the same as Chanote (freehold) but with a "minor" distinction, you don't own the land on leasehold but you own the house. Lease is normally 30+30+30 years. Who knows what happens after the first 30 years.

Tear it down after the lease runs out or burn it, your choice.

You can't own land as a person here in LOS with the Chanote title, you have to form a company to be able to do it and then you can only own 49% of the shares in a company, unless you are an american citizen, than 100%.

Price doesn't differ much between the two.

really? I've been under the impression that NO farang can own the land the house is on. Are you saying that US citizens Thanks can buy the land and the house on their name? can you please confirm. Thanks

[I say]

@KamalaRider, thanks for answering my question. I understand the difference now. Americans can own 100% of a company but Can't purchase land. Thanks

[I say]

Freehold / Lease land purchase. I would never advise anyone to go the Lease route. I don't know the ins/out of Thai Real Estate but in the USA the Leasehold can get ugly at the ending years with too many complications. The lease on the land can escalate enormous to be affordable unless you get a lease with a fix amount for the life of the contract after which maybe you have to kiss the house and improvements a sad goodbye. I did Real Estate in Hawaii and it was bloody hell there with the Leasehold.

[KamalaRider]

 

Leasehold is the same as Chanote (freehold) but with a "minor" distinction, you don't own the land on leasehold but you own the house. Lease is normally 30+30+30 years. Who knows what happens after the first 30 years.

Tear it down after the lease runs out or burn it, your choice.

You can't own land as a person here in LOS with the Chanote title, you have to form a company to be able to do it and then you can only own 49% of the shares in a company, unless you are an american citizen, than 100%.

Price doesn't differ much between the two.

 

KamalaRider, there are a number of false statements in the post: First, most people who lease land do also lease their house. However, the ownership of the dwelling(s) can be separated from the land, but only if certain procedures are taken. Thus, one doesn't automatically own the house even if the lease contract say so; Secondly, the maximum legal lease period is 30 years, not 30+30+30 as stated. Furthermore, the 30 years lease is only valid if the lease has duly been registered at the land office, else the maximum lease period will be reduced to 3 years irrespectively of what the lease contract says; Thirdly, the 'company route' mentioned is illegal period! Although this is common i Thailand but that does not mean it is legal.

OP, if your wife is Thai, buy the property or settle for a condominium in your name if you are hesitant to buy in your wife's name. If 'she buys' you have better alternative to secure posessory rithts than leasing. A usufruct or a superficies are both much better alternatives than leasing.

I forgot to mention, American citizens may own a company in Thailand 100%, BUT SUCH A COMPANY IS NOT ALLOWED TO PURCHACE LAND!

First of all, there aren't a NUMBER of false statements, there are actually none, you have chosen to interpret me by the letter, and you missed my comment. "Who knows what happens after the first 30 years."

The extra 2 X 30 years is based on a separate contract and as far as I know, none has tested it legally yet. That's why I wrote that first 30 years part.

I assume before anyone would buy or lease a property. they would actually check out what's required for the different types of "purchase"

I don't know ANYONE who don't own their house when bought on lease, if they don't, I would assume it was a rental contract with land lease.

It's perfectly legal to buy a house in a company name, but I agree on one thing, there has to be an active business in the company, making profit every year, or at least not go minus. Whatever the distinction is for that, THAT is perfectly legal.

I have a few american friends who's got houses in their company name, I will ask next time I meet any of them how they managed to do that.

[KamalaRider]

@KamalaRider, thanks for answering my question. I understand the difference now. Americans can own 100% of a company but Can't purchase land. Thanks

I'm meeting up with an american friend later today or tomorrow morning, I will ask him how he did when he bought his house in his company.

[KamalaRider]

@KamalaRider, thanks for answering my question. I understand the difference now. Americans can own 100% of a company but Can't purchase land. Thanks

I'm meeting up with an american friend later today or tomorrow morning, I will ask him how he did when he bought his house in his company.

Will meet an american on Monday.

Report back then, nano nano, signing off.

[Maestro]

...

I don't know ANYONE who don't own their house when bought on lease, if they don't, I would assume it was a rental contract with land lease.

...

Lease = NOT own.

Buy = Own

What exactly do you mean with "bought on lease"?

[KamalaRider]

...

I don't know ANYONE who don't own their house when bought on lease, if they don't, I would assume it was a rental contract with land lease.

...

Lease = NOT own.

Buy = Own

What exactly do you mean with "bought on lease"?

Lease land = Land lease

Buy house = buy house

bought house on land lease, ok now?

[Maestro]

Got it.

Got a lease on a piece of land and bought the house on the leased land. Two separate contracts.

[KamalaRider]

Met this morning with an american friend, it turned out that Americans can't buy land on the type on company they can own 100% of the shares, so I was wrong in my assumptions, sorry about that.

There are other ways, BOI is one, but it requires a larger investment and an active company.