Buying a House in Thailand

[wayne07836]

I do not post much on here but I do read quite a lot of the threads and have found some (not all) of the information that is posted to be very informative and I have learned so much about the trials and tribulations of living in Thailand, I would like to say thank you to all the seasoned posters that give sound and unprecedented advice to people like myself that are not so street wise, especially when it comes down to navigating through the system of obtaining not just a visa but the most appropriate visa for any individuals particular circumstances and other unrelated topics that cover everything from where can I get decent tea bags to buying a car or motorcycle. So now down to my particular circumstances and a genuine request for some advice.

My first trip to Thailand was almost 20 years ago and I immediately fell in love with the place for many different reasons that I will not bore you with, anyway I made it my primary destination for holidays and visited for 2-3 weeks at a time 3-4 times a year and not always to the same place or area, it was at that time that like so many men I decided that this would be a great place to retire and I would start to make preparations towards meeting my goals.

I think my first mistake was about 9 years ago (but only realized since reading forums such as this) in that I bought a house, it’s a nice place, a town house of just 3 houses attached that are at the end of a private drive way, they share a pool between the 3 in one of the villages on the East side of Pattaya.

My mistake? I bought the house by setting up a Thai company with shareholders that own 51% and me controlling the other 49%, I was told at the time by the property developer that this was not a problem and was a widely used practice of purchasing a house in Thailand if you were not married to a Thai.

Obviously since then, I have been reading forums such as this and done a little research and I find that this is not strictly a legal way of buying property, however I will say that up until now I have had my house for 9 years, I pay my accountant every year to submit my tax and I have had no issues at all, but I do work outside of the country and really it has only been a holiday home up until now for 3-4 weeks 3-4 times a year.

So what is my problem you might be asking yourselves, well I am getting closer to my planned retirement and hope to be living there full time next year, the guy who owns the house next door to me as asked me if I would be interested in buying it at quite a favorable price and I have said that I was interested, the reason being is that I could knock through the 2 houses (as they are attached) and make one larger one, but the main reason really is to give me more privacy, the people who own the 3^rd house only go for a month every New Year and are very nice folk that I get along with, but for the other 11 months of the year I would have the grounds and the pool to myself, so that is why I am interested.

I am and always have been a law abiding citizen and try to do the right thing, at the same time I would like to enjoy my retirement without the fear of immigration or the police turning up and taking my house away from me, especially if I buy the 2^nd house, does anyone have any advice on how this could be achieved without falling foul of the law.

Any constructive advice would be much appreciated.

[Langsuan Man]

You are of course going to open up the flood gates here at Thai Visa between those who argue that the company structure is illegal and those who don't

Foreigners are not allowed to own property in Thailand except condos in the farang 49% quota

But you don't own property in Thailand, you own a company that own's property in Thailand . If the company structure was illegal, like the naysayers are soon to start posting, then why does the Land Office allow it ? If it were illegal then they would refuse to issue a Chanote in a company name but they don't. The electric company would refuse to provide electricity to it but they don't, The water company would refuse to provide water to it but they don't. The local Amphur would not issue an address (Blue Book) if it were illegal

But most importantly it has never been reported here at Thai visa of anyone ever being forced out of their company owned house and they certainly would not be forced out by Immigration or the police. So IMHO opinion, so long as transfer taxes are paid to the Land Office for the adjoining house your company is in compliance with the law and can own two houses

The closets has been that the Land Office in Phuket that revoked the Chanote for land purchased in a company name by a motor cycle gang that was identified as a criminal enterprise and everything they owned including motorcycles were seized by the police as part of a long going investigation

[wayne07836]

Thank you for your response, and yes I fully understand that this is a very sore topic but I am wondering how many others are in a similar position to me and would be interested in knowing if they have encountered any problems.

I do pay my company tax every year, I have the blue book in my company name, I have electricity to the house and I have set up a direct debit with the bank so always gets paid on time and more importantly does not get switched off when I am at work for period's of time for the bill not being paid. I have a Thai driving license and both a truck and a motorcycle and a Thai bank account, all that was needed to complete all of these challenges was a copy of my passport, blue book for the house and up to date company accounts.

Like I said in my original post, I really have not had any issues in the 9 years I have owned the property but don't want any unpleasant surprises either, I was worried that buying next door might open up a can of worms, I am not married so unless I give the land away to a complete stranger and lease it back for 30 years, I don't see any other alternatives other than taking the risk and making sure that all my affairs are in order as much as I can, unless of course someone knows any different which was the reason for my post.

Thanks for your reply and I was on the same understanding that although close to the mark of being legal, no one had actually been prosecuted for doing it as long as all tax and accounts were filed, paid and up to date, unless of course someone knows any different.

Appreciate your time and I feel a little more secure now.

[Pinot]

I always advise that no one should buy property in LOS. It's a risky, poor financial decision. In Phuket where I live there is a property glut, yet the development continues at a furious pace. The market is dead. No one is buying yet the environmental disaster of this crazy furious development continues.

Don't buy in Thailand...rent.

[bangkoklawyer24]

For one case where you have to argue with the government about the legality of the corporate structure come 50 cases where you have to fight with the Thai shareholders to avoid the total loss of your property investment.

[jacky54]

I always advise that no one should buy property in LOS. It's a risky, poor financial decision. In Phuket where I live there is a property glut, yet the development continues at a furious pace. The market is dead. No one is buying yet the environmental disaster of this crazy furious development continues.

Don't buy in Thailand...rent.

Yes we have all heard it many, many times before on just about every thread on property. But if you buy a cheap house it's only a few years rent anyway, rent money is money down the drain.

Edited January 24, 2016 by jacky54

[slipperylobster]

I believe there was a post by a British man, who put his problem on youtube. You can research it, but if I remember correctly, he was a "shareholder" in a corporation that owned "property". Power of attorney was purchased for 500 baht...and he lost his legal status in the corporation. The Power of Attorney was obtained without his permission, and his signature was forged.

I suppose that is the worst case scenario.

My details may be inaccurate (I am not going to try to research the video I saw).... but I would be worried about somebody easily forging my name and getting power of attorney....in order to remove me from my property. Not sure if this could happen to anyone else. In any case, somebody will immediately post if this is true/untrue.

Edited January 24, 2016 by slipperylobster

[MaeJoMTB]

If its worked for 9 years already, I wouldn't worry.

Buying a second one, if you can use the same company, why not.

[bangkoklawyer24]

If its worked for 9 years already, I wouldn't worry.

Buying a second one, if you can use the same company, why not.

And if your house did not collapse for 9 years already, you should not worry building a second one on top of the old one. Why not.

[wayne07836]

OK thanks for all the responses, I think the underlying message is that if I have not any any problems in the past 9 years then do not worry to much, however except the possible risk.

I understand the comment about renting from jacky 54, but he may of missed that my real intention was to give me some privacy and have some control on who I live next door to, the guy wants to sell the house and not lease the property so if I do not buy it someone else will. But I do appreciate all of you comments and thank you for taking the time to respond.

[momtaz]

Interesting topic,,

My suggestion to you is:

If nothing happen in the past 9 years, is not an evidence to secure keep going on smooth forever, I really wish nothing will bother,

But, keep in mind that regulations, laws and relevant conditions are continuously changing and updating whether in Thailand or other counties,

Particularly in Thailand, regulations related to foreigners are time to time updated, in each time get more tightening restrictions,

to avoid any unpleasant surprises, try to pay a visit to a lawyer, other than the one probably you hired before to buy your property, explain the situation, and listen what will they say, or visit more than a lawyer.. hear from more sources and compare,

The past 9 years are counted past, but the regulations are always changing, updating and getting tight, consider this part to keep yourself updated as per the current regulations, hope everything will be fine and wishing you a very happy & peaceful retirement in Thailand!

[wayne07836]

OK got it thanks, like I said before the risk is all mine so be aware that things might change.

I have one more question if anyone could explain?

I read about people going for there 90 reports or applying for there extension of stay and needing the yellow house book, my book is blue can anyone explain the difference please.

And one other point about the owner needing to report a fallang staying with a TM 30 form, well I am the owner so does that mean I have to fill out a TM 30 or should it be a TM 28?

Thanks in advance.

[bangkoklawyer24]

Interesting topic,,

My suggestion to you is:

If nothing happen in the past 9 years, is not an evidence to secure keep going on smooth forever, I really wish nothing will bother,

But, keep in mind that regulations, laws and relevant conditions are continuously changing and updating whether in Thailand or other counties,

Particularly in Thailand, regulations related to foreigners are time to time updated, in each time get more tightening restrictions,

to avoid any unpleasant surprises, try to pay a visit to a lawyer, other than the one probably you hired before to buy your property, explain the situation, and listen what will they say, or visit more than a lawyer.. hear from more sources and compare,

The past 9 years are counted past, but the regulations are always changing, updating and getting tight, consider this part to keep yourself updated as per the current regulations, hope everything will be fine and wishing you a very happy & peaceful retirement in Thailand!

No need to visit a damned lawyer. That's what TV is for and it is free. In principle nothing has changed. Property investment is the same as a marriage. After you have survived the seventh year, it is rock solid for ever and ever. Trust me.

[wayne07836]

Ha ha, thanks for the reassurance bangkoklawer24

[Langsuan Man]

No need for a Yellow book, Immigration does not require it, they just want something to prove that you live where you say you live. Those who can get a Yellow Book easily use that, the vast majority just use a utility bill or a lease since some Amphurs make getting a Yellow Book a PITA

[robertson468]

OK got it thanks, like I said before the risk is all mine so be aware that things might change.

I have one more question if anyone could explain?

I read about people going for there 90 reports or applying for there extension of stay and needing the yellow house book, my book is blue can anyone explain the difference please.

And one other point about the owner needing to report a fallang staying with a TM 30 form, well I am the owner so does that mean I have to fill out a TM 30 or should it be a TM 28?

Thanks in advance.

But remember that things can also change for the better! Be positive, but cautious. If there is such a quantum detrimental change in house ownership, you will get plenty of notice and you will see a mass exodus of Foreigners and hundreds of thousands of houses coming on to the market, which could cause a collapse of the Thai Housing Market. I don't think that that is what the Government would like to be implicated in, as they have enough problems as it is! My advice is go for the purchase of the other half of your house and hope you have a wonderful retirement in it.

[Henryford]

Just because you have got away with an illegal act for 9 years doesn't justify committing another illegal act. If you must buy property in Thailand keep it legal.

[dotpoom]

I have a house in Thailand that I bought because I prefeered at the time to have a garden etc.around me with the freedom to surround myself with all the beautiful ornaments you can buy here (gettin a little older now, myself I mean, and am less inclined to be doing the daily necessary work a house needs to keep it up to scratch, so selling up and moving back to a condo). It is my 2nd.house to have owned. I also had a condo in a company name. I never had the slightest problem in the past 15 years. If I can afford it I would always prefer to buy rather than rent...I enjoy the freedom I have to "style" it whatever way I choose, to hang pics and decorate it to my own liking...in other words...to put my own stamp on it so that when I am out I look forward to returning to my "home"...not a rented room.

[jacksam]

A small side issue. You may need to look into the rights of the third house owner. Clearly they have shared interests. You may find you need their approval to convert the two houses you refer to into effectively one

[scorecard]

Just because you have got away with an illegal act for 9 years doesn't justify committing another illegal act. If you must buy property in Thailand keep it legal.

???

[scorecard]

I always advise that no one should buy property in LOS. It's a risky, poor financial decision. In Phuket where I live there is a property glut, yet the development continues at a furious pace. The market is dead. No one is buying yet the environmental disaster of this crazy furious development continues.

Don't buy in Thailand...rent.

Off topic.

[bazza40]

The OP's position with the house owned by the company is essentially at the whim of the 51% shareholders that are Thai. They can kick him out any time they want to, sell the house from under him, and there is nothing he can do.

While it's true nothing has happened for 9 years, it doesn't mean nothing will happen in the future. Putting extra money into property which is already on a shaky ownership foundation sounds fairly risky to me.

Personally, I prefer the security of renting. While that may sound like an odd statement, it seems to apply in Thailand more than anywhere else.

[Avrock]

Honestly speaking you should consult for professional guidance in this case..of course TV is a huge help but personal experiences of others won't help you if things go south..most of the expats living in Thailand owning properties are also married to Thai nationals..so having a citizen by your side is an added advantage which doesn't apply in your case..of course there's always a lope hole but then the rules are constantly changing & there are many other factors that come into play as well..

[blackcab]

But remember that things can also change for the better! Be positive, but cautious. If there is such a quantum detrimental change in house ownership, you will get plenty of notice and you will see a mass exodus of Foreigners and hundreds of thousands of houses coming on to the market, which could cause a collapse of the Thai Housing Market. I don't think that that is what the Government would like to be implicated in, as they have enough problems as it is! My advice is go for the purchase of the other half of your house and hope you have a wonderful retirement in it.

If the rules regarding the company ownership of property by foreigners using what are effectively nominee shareholders became strictly enforced, I think you may see some foreigners leaving, however there would be no collapse in the Thai housing market.

In fact I think quite the opposite would happen. If these companies were given 1 year to sell their property or have it sold for them then I believe there would be a queue of Thai people wanting to buy what are probably very nice houses with good maintenance at firesale prices.

[bluebluewater]

Just curious if you have any idea whom the individuals are that own the other 51% of your company?

[wayne07836]

I know 2 of the share holders and between them they hold about 30%, one is a very long time friend that I have known for about 15 years and trust as much as you can and the other is my ex-wife who I have supported and get along with very well and is now studying in the UK for a University degree.

As I am aware none of the share holders know each other, and as I understand is standard practice, I have signed letters of resignation from each of them from the board.

The share holders I am not concerned about, as much as anyone can, I trust them and do not foresee any problems coming from this direction, I was more concerned about Government intervention.

[BaldPlumber]

Honestly speaking you should consult for professional guidance in this case..of course TV is a huge help but personal experiences of others won't help you if things go south..most of the expats living in Thailand owning properties are also married to Thai nationals..so having a citizen by your side is an added advantage which doesn't apply in your case..of course there's always a lope hole but then the rules are constantly changing & there are many other factors that come into play as well..

The rules and loopholes are extremely well documented in tedious detail on this forum.

You're either prepared to take a risk or you aren't.

Edited January 25, 2016 by BaldPlumber

[mogo51]

You are of course going to open up the flood gates here at Thai Visa between those who argue that the company structure is illegal and those who don't

Foreigners are not allowed to own property in Thailand except condos in the farang 49% quota

But you don't own property in Thailand, you own a company that own's property in Thailand . If the company structure was illegal, like the naysayers are soon to start posting, then why does the Land Office allow it ? If it were illegal then they would refuse to issue a Chanote in a company name but they don't. The electric company would refuse to provide electricity to it but they don't, The water company would refuse to provide water to it but they don't. The local Amphur would not issue an address (Blue Book) if it were illegal

But most importantly it has never been reported here at Thai visa of anyone ever being forced out of their company owned house and they certainly would not be forced out by Immigration or the police. So IMHO opinion, so long as transfer taxes are paid to the Land Office for the adjoining house your company is in compliance with the law and can own two houses

The closets has been that the Land Office in Phuket that revoked the Chanote for land purchased in a company name by a motor cycle gang that was identified as a criminal enterprise and everything they owned including motorcycles were seized by the police as part of a long going investigation

I am in the same position as the OP, having bought a house in company name 8 years ago. Whilst what you say is factual, I stopped trusting Thais a long time ago and they are people who live on whims, even more so, the people running the place! Trouble is I can't sell my house as the market is crap.

I would not be sticking my head further into the oven if I was this OP.

[thedemon]

You are of course going to open up the flood gates here at Thai Visa between those who argue that the company structure is illegal and those who don't

Foreigners are not allowed to own property in Thailand except condos in the farang 49% quota

But you don't own property in Thailand, you own a company that own's property in Thailand . If the company structure was illegal, like the naysayers are soon to start posting, then why does the Land Office allow it ? If it were illegal then they would refuse to issue a Chanote in a company name but they don't. The electric company would refuse to provide electricity to it but they don't, The water company would refuse to provide water to it but they don't. The local Amphur would not issue an address (Blue Book) if it were illegal

But most importantly it has never been reported here at Thai visa of anyone ever being forced out of their company owned house and they certainly would not be forced out by Immigration or the police. So IMHO opinion, so long as transfer taxes are paid to the Land Office for the adjoining house your company is in compliance with the law and can own two houses

The closets has been that the Land Office in Phuket that revoked the Chanote for land purchased in a company name by a motor cycle gang that was identified as a criminal enterprise and everything they owned including motorcycles were seized by the police as part of a long going investigation

I am in the same position as the OP, having bought a house in company name 8 years ago. Whilst what you say is factual, I stopped trusting Thais a long time ago and they are people who live on whims, even more so, the people running the place! Trouble is I can't sell my house as the market is crap.

I would not be sticking my head further into the oven if I was this OP.

Imagine if I wrote "I don't trust Americans" or "I don't trust the British". How ridiculous would that sound?

[fxe1200]

Just ask Colin Vard! He knows.