Buying a House in Thailand

[MaeJoMTB]

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?

Not ridiculous but, entirely sensible.

Trust No One!

[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..

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.

My take on this matter is that a house is meant to serve as a security...it shouldn't have the word risk associated to it & in TL it in fact does have potential risks..one may try to dodge the system but it can't be altered or avoided..the op is not the only case there are many expats going through the same situation..I myself fancy the thought of having my own garden,drilling holes in the wall to hang pictures & having a pack of dogs running around with no one to interfere but sadly this luxury comes with risks..I hope op finds the best possible way but being 100% secured is not an option in housing sector in Thailand

[MyFriend You]

I say good luck and disregard a the nay sayers, I know several people that have two houses - but I must caution you - when buying the second house with plans to attach it to the current one, ensure you have the appropriate approvals, and use a reputable well established contractor - I knew a German man that added a couple bedrooms and a garage to his house, Inspector came and condemned the whole building as the construction was not to standard, and the house didn't match the original Chanote any longer. Basically he did all the work 'on the cheap' hired off-duty carpenters, cement men, bought cheap "excess supplies, wiring, piping etc (from another construction site I assume) and the work was haphazard - he was evicted from his own house and the Company he had formed was found to be fraudulent.........he was fined, and lost the whole enchilada and moved to Cambodia - I, of course won't divulge his name, but his restaurant on the river is quite successful.

[cabanlit]

Whatever you do, just understand that you'll probably never, ever be able to sell it and get your money back. What you spend is gone.

[bazza40]

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?

Not at all ridiculous. As several major Australian companies have found to the tune of quite a few billion dollars, when you shake hands with the Americans on a deal, you count the fingers on your hand afterwards. Don't get me started on Quantitative Easing.

[crazykopite]

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.

I own two properties by way of Ltd companies however as they are in two separate areas of the kingdom I have two companies one for each property and in ten years I have never had any issues I pay my dues every year and have all my audited accounts. I would imagine the guy next door to you also purchased his property in the same way via Ltd company with this in mind you would have a predicament either buy it by way of his company or get him to pay all the sales /property taxes and then transfer the property into your existing company I would only suggest this method if you were knocking both house into one , speak with your accountant . I don't understand why you think it was a big mistake by owning a Thai Ltd company there are 1,000s who have gone down this route !

[wayne07836]

Thanks for response crazykopite,

My initial intention was to go the easy route and just buy his company for now, I do not intend doing the construction work until I have retired so that I can be there to oversee the work, this would give me the option to either rent it out until then or sell it on at a further date in my circumstances change.

If and when I do retire and decide to carry out the construction, how easy or difficult is it then to put both properties into one company and dissolve the the other one? I know there will be some costs associated with this but do you know roughly how much this would cost? I understand it costs around bht 50,000 to wind up a limited company but what about the property tax and other costs?

Once again I want to thank everyone for some input and advice.

[MaeJoMTB]

Forget buying the other guys company, too easy to hide loans and debts on the company.

Not to mention his company may have shareholders that can't be trusted.

Use your company to buy the property from his company.

It would be financial madness to buy his company.

Edited January 26, 2016 by MaeJoMTB

[Arkady]

I suggest you contact a firm like Sunbelt, if they still operate in Pattaya (I have no connection with them), to see what the attitude to the Land Office there is to foreign controlled companies buying land. There was an instruction from the Interior Ministry to Land Offices in 2006 to investigate any applications for land transfers by companies with any foreign shareholders or directors to ensure that these were genuine business operations and that the majority Thai shareholders had really invested their own money in the companies. Prior to that the Land Offices were supposed to send any applications where the foreign shareholders owned 40% or more to the D-G's office for investigation. It used to be fine to reduce the foreign shareholding to less than 40% just before the transaction and bump it up again immediately afterwards, even signing all the docs to do so in plain sight right there in Land Office and nobody cared because they were following the letter of the regs, so couldn't get into trouble. I have heard of land transfers to companies in Bkk being refused in recent years because the Thai shareholders couldn't answer simple questions like what type of business does this company do and why does it plan to invest its entire capital in a residential property. The officers just assumed the company must be a front for a foreigner and refused to permit the transfer.

So you need to talk to someone who is up to speed on current practice in the Pattaya Land Office. If they don't know, they can take a sounding from a Land Officer without disclosing your name. In fact, you should be able to get a Thai friend to contact the Land Office and ask the questions. I have always found the staff very helpful and straight forward in answering questions and they know exactly what type of structures foreigners have used to buy land.

Probably your existing structure will be OK, although it represents a breach of the Land Code and the Foreign Business Act. The Land Dept and the Commerce Ministry don't talk to each other and neither has the staff to investigate all of these cases. That seems to be the status quo today but there is no guarantee that what has worked in the past will always work in the future, particularly if it falls in a grey area of the law.