pre-buying a condo and decide not to buy it

[schietkop]

Hi guys, does anyone know the following. If you pre-buy a condo and paid the reservation fee and all down payments up to transfer date, but the unit was not yet transferred. Then the contract states interest will be calculated if you fail to pay the rest of the amount every day you fail to do the transfer of ownership. How does it look like legally? I hear a lot of different stories. I can imagine the developer will take all down payments and other fees paid cause they lost the time to re-market the unit. But I don't see how they can force anyone to sign a transfer of ownership when that person made up his mind not to buy it for whatever reason. Any advise is appreciated. (PS the whatever reason in my case is I have other investment opportunity that is MUCH more interesting even if I loose my down payments at 350K THB)

[steven100]

not sure anyone will be able to advise exactly what is likely.......... I think your lawyer is the only way you'll get a precise answer. He will know where you stand based on what the contact stipulates.

Some contracts are defined differently from others.

[trogers]

Buying a condo off plan is basically a contract based on a promise for a promise.

The developer delivered his promise. So, it is now your turn.

[wooloomooloo]

Any advise is appreciated. (PS the whatever reason in my case is I have other investment opportunity that is MUCH more interesting even if I loose my down payments at 350K THB)

Time will tell on your much more interesting investment opportunity. Come back in six months and let us know how it panned out.

[Swiss1960]

• does your contract not have an opt-out option? That should clarify things, not only the interest to be paid on the oustanding final transfer-amount

Option 1 is to talk with the seller - just tell him you don't have them money anymore and he can keep the down-payments but waive the future interest and I am really sure that he will be more than happy to sign a waiver stating the above and put the unit out for resell at a higher price than you agreed previously

Option 2 is to finalize the buy of the unit and then put it on the market for 10-20% mark-up, depending on the prize asked for other units in the development.

[KittenKong]

Many people would try to sell on the contract before the unit is completed. This may be quite easy if the selling price from the developer has increased compared to the price you contracted to buy at. It also has the advantage of avoiding transfer tax, though the developed may make a charge for the paperwork.

At worst you should be able to claw back some of the 350K you have already spent. At best you might even make a profit.

[alantan88]

I am having the same problem now.

[FRIDAYMe]

Many people would try to sell on the contract before the unit is completed. This may be quite easy if the selling price from the developer has increased compared to the price you contracted to buy at. It also has the advantage of avoiding transfer tax, though the developed may make a charge for the paperwork.

At worst you should be able to claw back some of the 350K you have already spent. At best you might even make a profit.

Lots of my friends told me to do like what you have mentioned too. now I also looking for a condo that could be sold out easily

Cheers

[vukovar77]

It is very risky to make such contracts in Thailand now ,when real-estate business in Thailand is in big danger to collapse!

Prices are too high and banks are in danger too,so they are very cautious for giving new mortgages!

There is huge amount of new units unsold in Bkk,Pattaya and Chiang Mai as I can notice from news in internet and media!

Unfortunately,it is not much we can do if these things happened !

Thais does not want(and they have no cash)to buy second hand units.Banks will not finance such units as well.

I think prices will go down sharply very soon ,mostly from foreigner owners very soon!

[chicowoodduck]

My best advice is to place your head squarely between your legs and kiss your arse and your money good bye,,,,?

[chilli42]

Well you did sign a contract agreeing to these terms .... correct? If I were you I would sell the property - if there is no specific clause prohibiting 3rd party sale in your purchase contract. Market it, find a buyer. Then work out the transfer ... transfer the contract or transfer the property. I have done this a few times in Bangkok on premium condos and actually made a respectable profit. Even if you take a small loss it may be better financially than losing 100% of the payments you have made and having an irate developer chasing after you for interest payments.

[thailand49]

You make all the payments and now final do not want the property personally I think that is on you? I suggest you make the final payment get the transfer and resell the property at what you got it for in the pre-reservation price which should bring you back even?

[Paul944]

Legally it sounds very solid. You signed the contract. It seems you are even a lucky guy which condo got finished because a lot of people on TV complain they are waiting on their pre-buy condo forever to be finished.

The fast way: Ask the company if the contract can be canceled and at which cost. Maybe you can even get some money back. If you tell them you had some bad luck and you do not have the money for the final payment, maybe they will be cooperative.

The slow way: find a buyer for the condo. If the prices did not drop and you want to take a 350k baht loss you should be able to get a quick sale.

[pipeflaw]

What about the situation where you give the developer a "reservation deposit", say 20,000THB, and before you sign the purchase contract you decide you don't want the unit. If there is nothing in writing between the developer and buyer on what happens is the buyer entitled to get his deposit back?

[trogers]

What about the situation where you give the developer a "reservation deposit", say 20,000THB, and before you sign the purchase contract you decide you don't want the unit. If there is nothing in writing between the developer and buyer on what happens is the buyer entitled to get his deposit back?

This is just an option contract to prevent the developer revoking his offer to sell the unit to you at an agreed price. The Bt20k is the consideration for this contract.

Such a contract has a specific time validity to allow for due diligence and such, after which the main contract would be agreed and signed.

Should the option be not exercised within the specified time frame, the consideration is forfeited by the developer.

The option contract is different from the sales and purchase agreement, which the OP is asking questions...

[mrfaroukh]

usually the contract is built in such a way that if you miss any payment you must pay a huge penalties but if they do not transfer on time or do not even transfer it all they get away with it somehow. There are many small script in all the documents you must read very carefully before buying these types of condo or house.

[schietkop]

Thanks all for the replies some good tips here!

[HampiK]

What about the situation where you give the developer a "reservation deposit", say 20,000THB, and before you sign the purchase contract you decide you don't want the unit. If there is nothing in writing between the developer and buyer on what happens is the buyer entitled to get his deposit back?

About 5-6 years ago i paid the booking fee, but also told that day, that i am not sure yet 100%. They promised me to give back the amount.

I actually not was expecting to become the money back.. but if they give back even better... At the end the give the money back without any problems... But i guess at the end it depends on the people.