Flipping Houses

[elgordo38]

18 minutes ago, digibum said:

 

This one concerns me as well.  I'm thinking about setting up some financial structures whereby money would get released over time so that she's not in a position where she has some lump sum distribution of money and she suddenly has all of the hyenas coming out of every bush.  

 

That said, over the years my wife has become increasingly savvy to just how manipulative her friends and family can be.  She used to think I was some sort of fortune teller when I would predict with scary accuracy when they were trying to set her up and exactly how they would go about it.  She's since figured out that I can't see the future, but I can see the hearts of manipulators.  

 

She's getting where she shuts that stuff down a lot faster now.  And because any loans or giving of money is from her money she's felt that sting enough that the lessons are taking hold.  

 

Really though, her family are not bad people.  They're just incredibly stupid when it comes to supporting themselves.  They have poor-people thinking when it comes to handling money.  It's so obvious and you can see what's going to happen a mile away.  

 

Her friends are a different bunch.  Several of them are straight up con-artists.  Like my wife said to me, "Now I know why farangs think all Thais are after their money.  They are!"  She's lost probably 50% of her friends that she had when she moved to the US.  Most because once they found out she was making enough money on her own to buy cars and other nice stuff they came around trying to get their share.  

 

Business ideas, lending money, one even asked if my wife would finance the house she wanted to buy because, get this, her and her husband don't have jobs and the bank wouldn't give them any money.  So, you have no way to pay me back and you want me to lend you the money to buy a house?   

 

I think she really saw her friends for what they really are the first time we travelled back to Thailand to visit after moving to the US.  They all asked her, "buy me this" and "buy me that" and they all promised to give her the money once she got to Thailand.  Perfume, clothes, shoes, makeup, blah, blah, blah.  My wife spent something like $2,500 buying all this stuff for them.  Oh, and they all came to greet her the first few nights we were in town so they could collect their orders.  But when she asked for the money, well, they didn't have it today but they would have it tomorrow.  And then they would disappear and not answer the phones for the rest of our stay.  I think my wife collected lime $300 of the $2500 she was owed.  

 

Scumbags.  

 

But like I said, she's learning.  It takes awhile sometimes.  I've had to deal with many nights of her breaking down in tears when she finally realized that her friends had taken her for a mark but she's finally seeing them for what they are and she's getting smarter about not allowing them to prey on her.  

 

 

You got me in stitches on this one but I am going to copy and paste and send to my g/f as part of life's lesson. You really cracked me up made my day. 

[digibum]

4 hours ago, Lannathaijohn said:

I would agree with Saladin's comments.

 

My experience in property ownership and renting in Chiang Mai, whilst not answering your question directly , may give you some insight.

 

1. Some 20 years ago, my wife and I started to buy properties in Chiang Mai and then let them out furnished. We eventually owned 5 town houses, 1 shop and 5 detached houses.

2. The rental market was good, showing net annual rental income of around 6% until around 8 years ago when rents dropped due to the ever increasing supply of new houses coming onto the market.

3. Around five years ago we decided to sell the properties and expected to complete this in 1 - 2 years and also make a capital return on the investment.

4. Well , it has taken 5 years to sell all the properties ( the last one is being transferred this month) - it has taken this length of time to find interested buyers 

5. All buyers were Thai and there  was a mixture of those buying for their own residence and a few for renting out.

6. Most of them arranged for a bank loan in the region of 50- 70% of the price 

7. All properties were refurbished to a good standard prior to advertising through estate agents

8. The sales prices were on average  only 20% higher than the original purchase price -    This is an insignificant capital gain over a period of 10-20 years

9. The reason for not achieving higher resale prices was due to the extremely limited market for resale properties. 

 

I would point out that this is my actual experience in Chiang Mai only and also only with houses - although It is just as bad, if not worse, with condominiums where there are hundreds of vacant properties. Why the over supply? Cheap loans for developers in the last few years with numerous new construction companies entering the housing market.

To the OP - I realise my business  is not exactly what you have in mind but the underlying issues may still be relevant to you. 

 

 

 

Thanks.  A lot of valuable information.  

 

Mind if I ask some questions?  

 

First, 6% cash on cash return on rentals seems a tad low to me.  Any reason why you wouldn't have purchased homes back in your home country and put them under property management (passive) and collected 6% or more?  I understand that there are good reasons to own something that produces income in a local currency as a hedge.  Just trying to figure out what your motivation was.  

 

Would you say that the lack of price appreciation was due more to a glut of new homes or some other factor?  You often see the same thing here in the US.  In fact, that's sort of how a real estate cycle works.  An area becomes desirable, people bid up the existing homes, developers flood the market, prices stagnate or the market drops depending on the level of new developers saturating the market.  Just wondering what you attribute the lack of appreciation to.  

 

 

[cyberfarang]

22 minutes ago, digibum said:

 

Why would you assume any of that.  Do we know each other?  Do you have some insight into my soul?  

 

My thinking was to set up a Thai company, 49% owned by me, 51% owned by my wife.  We would pay taxes like anybody is supposed to.  Either that or put the entire company in her name and have a US company loan the Thai company money which had to be paid back after the disposition of the asset.  Not sure yet.  Would need to discuss with my lawyer in the US and a lawyer in Thailand to figure out what's the best structure.  

 

Haha, if there's anybody who is likely to try to not pay taxes or to do something under the table, look at my wife.  You should hear her cursing when she gets her paycheck (F'ing government's taking all my money) or she finds out how much I have to set aside after closing a deal for taxes.  :-)  

 

 

You said in your OP;  My wife being Thai should have no problem holding the land in her name. Or is this all a big misunderstanding.

 

Please let me give you some tips on how you could avoid all the bureaucracy and red tape as a foreigner trying to run a business in Thailand.

 

You are in a good situation considering your Thai wife lives with you in America. If you own property in the States and it`s now in your name, amend it and put it in joint names with your wife. The same applies to any bank accounts you hold in America, that is if not already done so.

 

If you decide to buy land and property in Thailand, say it`s all being financed with your Thai wife`s money and she has assets and bank accounts in the States to prove it. Do everything in your Thai wife`s name and on paper, you stay in the background as a non working partner. The beauty of all this that it`s completely legal. Of course a lot depends on how much trust you place in your wife.

 

Be interested to know what you think about this method?

[bazza73]

40 minutes ago, cyberfarang said:

You said in your OP;  My wife being Thai should have no problem holding the land in her name. Or is this all a big misunderstanding.

 

Please let me give you some tips on how you could avoid all the bureaucracy and red tape as a foreigner trying to run a business in Thailand.

 

You are in a good situation considering your Thai wife lives with you in America. If you own property in the States and it`s now in your name, amend it and put it in joint names with your wife. The same applies to any bank accounts you hold in America, that is if not already done so.

 

If you decide to buy land and property in Thailand, say it`s all being financed with your Thai wife`s money and she has assets and bank accounts in the States to prove it. Do everything in your Thai wife`s name and on paper, you stay in the background as a non working partner. The beauty of all this that it`s completely legal. Of course a lot depends on how much trust you place in your wife.

 

Be interested to know what you think about this method?

Funniest post I've read in years 55555555

[Destiny1990]

3 hours ago, bazza73 said:

4 feet 11 inches and 40 kg. Good things come in small packages. Alas, I'm 6 feet and 95 Kg. I must be baaad.

More overweight than bad.

[bazza73]

Just now, Destiny1990 said:

More overweight than bad.

Going by the BMI tables, are we? They don't necessarily apply to outliers. I'm never going to have to worry about osteoporosis.

Now back on topic, naughty boy.

[Destiny1990]

6 minutes ago, bazza73 said:

Going by the BMI tables, are we? They don't necessarily apply to outliers. I'm never going to have to worry about osteoporosis.

Now back on topic, naughty boy.

I think there is no money in it because the flip can take years as finding a buyer is a time consuming proces.labor is cheap so u not can save lots of money by renovating  it yourself so its a big risk to even break even.To built an apartment block for thais 20/40 units and rent them out for 3-4 k monthly maybe can work but again the ownership for u complicated.

Edited April 25, 2017 by Destiny1990

[digibum]

4 hours ago, NiwPix said:

First, I have no first hand experience in house flipping, but it did cross my mind and this thread caught my attention.

My very first reason I dont flip houses yet or looked into it in more detail is because I don't have the cash saved up yet. Lets say I did have the cash and am interested in it, these are the things that I know and / or worry me ( btw, I am just going through financing my first house with my thai wife in a new development ).

1. There is a business tax. I am not sure if they have this in the US as well: 3.3% of the appraised valuation of the property if selling within a 5 year period. This applies to both individuals and companies.

2. Banks tend to finance 80-90% of THEIR appraisal value....not how much you will buy it for.

3. I am not to sure flipping in developing/growing areas is a good idea, but this can be due to me not having experience with flipping homes. I live in Ubon Ratchathani which is growing very fast in my opinion. There are new developments EVERYWHERE. New ones about to get started. Yet I see so many old AND new houses completely empty as well as several housing blocks...even in good condition. I wonder why they don't sell and what it takes to sell them.

4. If I would have the time and especially patience, I would buy a piece of land somewhere in a decent location and build a house. It will definitely come cheaper ( probably about a third cheaper ) than buying a newly built house and I could get better quality and customization at the same time.

 

Suggestion: Sounds like you come to Thailand from time to time. Before you make the final move, why not give it a try on one property next time you're here and see how it goes. If you make money, great. If you loose money, it most likely will not be much or you have a house to live in if you do end up in thailand :)

 

Thanks for the insights.  From a US perspective . . . 

 

1.  We have various taxes.  Oh, we have taxes :-)  

 

2.  Appraised value is always the value loans are based off of here.  There would be rampant fraud if I could get my buddy to pay $1,000,000 USD for a house that was worth $250,000 and then have him default on the loan.  The banks aren't that stupid :-)  

 

3.  Could be over development.  Happens everywhere.  When the price of existing homes rises, developers go crazy.  Especially in Thailand where I would assume city planners might not throttle new inventory like they sometimes do in the US by withholding building permits.  

 

4.  Depends on how much of the work you're in for, I'm assuming.  I can build new in the US for about 20% - 30% cheaper . . . if I act as the general contractor and do all of the sub-contractor hiring.  Twenty percent is roughly going to be the GC's margin so if you eliminate them plus run the project efficiently, you can nudge 30%.  

 

Generally though, using a GC, you're going to end up maybe 5% cheaper (maybe).  I've seen some people come in 10% under existing on a few occasions and depending on the market dynamics but then you have to factor in getting construction loans (if you're financing the deal) and flipping that to a conventional loan upon completion (more fees, again if you are financing and holding as a primary residence).  Plus 6 - 9 months of a lot of money going out while you still need a place to live.  

 

I mean, if you have a very specific thing in mind, go for it.  It's a great way to get exactly what you want.  

 

Visit often and lived in Thailand for several years :-)  These days I usually don't make it over for long enough to complete a flip.  Maybe 2 or 3 weeks at a time.  Not enough time to acquire a property, get working on it, and sell it.  But good point.  

 

 

 

[digibum]

1 hour ago, cyberfarang said:

You said in your OP;  My wife being Thai should have no problem holding the land in her name. Or is this all a big misunderstanding.

 

Please let me give you some tips on how you could avoid all the bureaucracy and red tape as a foreigner trying to run a business in Thailand.

 

You are in a good situation considering your Thai wife lives with you in America. If you own property in the States and it`s now in your name, amend it and put it in joint names with your wife. The same applies to any bank accounts you hold in America, that is if not already done so.

 

If you decide to buy land and property in Thailand, say it`s all being financed with your Thai wife`s money and she has assets and bank accounts in the States to prove it. Do everything in your Thai wife`s name and on paper, you stay in the background as a non working partner. The beauty of all this that it`s completely legal. Of course a lot depends on how much trust you place in your wife.

 

Be interested to know what you think about this method?

 

I don't necessarily hate that idea but I do have plenty of questions I would like both my US and a Thai lawyer to weigh in on.  

 

Most states in the US are community property states so whether her name is on the title or not, she's entitled to half (or more - f'ing lawyers) so some level of trust is implied :-)  

 

I really don't care how it's structured.  I only mentioned that she could hold the land in her name as many people assume that once you say anything about owning land they flip out and tell you that you can't own land in Thailand.  I get that.  I didn't just get off the plane yesterday.  

 

Worst case scenario is she buys it as an individual in her name, pays Thai taxes on the proceeds, investment capital goes into and out of Thailand as needed, but profits stay in Thailand.  All of that, AFAIK, would be perfectly legal.  If we can set it up with less red tape via a corporate entity, great.  But none of what was suggested was in order to avoid taxation.  

 

[newnative]

We don't do houses but if you know what you're doing you can make some money flipping condos. My partner and I have bought and sold 15 condos since we moved here in 2010.  We also did some condo flipping in the US so we had some experience.  The 3 most recent sales, all in Pattaya, were in October 2016, February 2017, and this past weekend.  Despite all the 'sky is falling' TV posts, the market hasn't tanked in our experience and we are still finding buyers--the latest buyer is from China.  The February buyer was Thai and the October buyer was from Singapore. Thais may or may not like to buy second-hand houses but they don't seem to have a problem buying second-hand condos; we have sold 3 condos to Thais. 

[Destiny1990]

2 minutes ago, newnative said:

We don't do houses but if you know what you're doing you can make some money flipping condos. My partner and I have bought and sold 15 condos since we moved here in 2010.  We also did some condo flipping in the US so we had some experience.  The 3 most recent sales, all in Pattaya, were in October 2016, February 2017, and this past weekend.  Despite all the 'sky is falling' TV posts, the market hasn't tanked in our experience and we are still finding buyers--the latest buyer is from China.  The February buyer was Thai and the October buyer was from Singapore. Thais may or may not like to buy second-hand houses but they don't seem to have a problem buying second-hand condos; we have sold 3 condos to Thais. 

Interesting but it can only work if u can buy such a unit at a bargain price and in a deplorable condition.U buy them from the auctions and or from banks?

[bazza73]

2 minutes ago, newnative said:

Thais may or may not like to buy second-hand houses but they don't seem to have a problem buying second-hand condos; we have sold 3 condos to Thais. 

That's because in many cases they will tear the apartment down to floor level and do a complete refurbishment.

Possibly one can make money in Pattaya and Phuket flipping condos. In Chiang Mai, you're probably going to do better at the racetrack.

[digibum]

10 minutes ago, Destiny1990 said:

Interesting but it can only work if u can buy such a unit at a bargain price and in a deplorable condition.U buy them from the auctions and or from banks?

 

The number one rule of real estate:  You make money when you buy, not when you sell.  

 

Real estate that any agent can sell is retail real estate.  You're going to pay retail.  The reason you can make a profit on flips is because you're willing to do the following:

 

1.  Find a deal.  Not always easy.  Unless you set this up as a professional business and you have active marketing campaigns going on trying to find sellers before they list their property on the retail market, it might be a month to several months between even seeing a deal you're interested in.  Then, you have to get the property under contract and you won't always do that so many of the deals fall through.  

 

2.  Risk your capital by investing it in the renovation.  If you've miscalculated the ARV (after-repair value) you'll lose money.  If you miscalculated the amount of repairs, you'll lose money.  If you get in there and find out the plumbing is rotting and the place has to be completely gutted, you're going to lose money.  

 

That's where the money is.  The hard work you put into finding deals and the financial risk you take with your capital.  

 

You can't make money overpaying for assets.  You're not looking to take a decent condo or house and slap some new paint on the walls and hope for a 30% return on your money.  Transaction fees would kill you.  

 

You have to buy the ugly stuff that nobody would touch in the retail market and the owner either doesn't want to or can't afford to bring up to retail quality.  Your profits are a function of your willingness to do that work and risk your capital.  

 

[Destiny1990]

16 minutes ago, digibum said:

 

The number one rule of real estate:  You make money when you buy, not when you sell.  

 

Real estate that any agent can sell is retail real estate.  You're going to pay retail.  The reason you can make a profit on flips is because you're willing to do the following:

 

1.  Find a deal.  Not always easy.  Unless you set this up as a professional business and you have active marketing campaigns going on trying to find sellers before they list their property on the retail market, it might be a month to several months between even seeing a deal you're interested in.  Then, you have to get the property under contract and you won't always do that so many of the deals fall through.  

 

2.  Risk your capital by investing it in the renovation.  If you've miscalculated the ARV (after-repair value) you'll lose money.  If you miscalculated the amount of repairs, you'll lose money.  If you get in there and find out the plumbing is rotting and the place has to be completely gutted, you're going to lose money.  

 

That's where the money is.  The hard work you put into finding deals and the financial risk you take with your capital.  

 

You can't make money overpaying for assets.  You're not looking to take a decent condo or house and slap some new paint on the walls and hope for a 30% return on your money.  Transaction fees would kill you.  

 

You have to buy the ugly stuff that nobody would touch in the retail market and the owner either doesn't want to or can't afford to bring up to retail quality.  Your profits are a function of your willingness to do that work and risk your capital.  

 

Agree and u find such bargains where??And as i said its the land office that never looses.

[bazza73]

32 minutes ago, digibum said:

 

The number one rule of real estate:  You make money when you buy, not when you sell.  

 

 

An interesting rule. I thought the rule for exchange traded options was you make money when you  sell, not when you buy.

Somehow, I think your time frame for refurbishment and selling is somewhat optimistic. 2-3 months for a flip? This is Thailand.

Maybe possible in Pattaya or Phuket. Chiang Mai? There are probably glaciers that move faster.

 

[digibum]

1 hour ago, Destiny1990 said:

Agree and u find such bargains where??And as i said its the land office that never looses.

 

Well, finding out how to go about that in Thailand was one of the goals of meeting some flippers on here.  

 

In the US, I have wholesalers who market like crazy to find these properties and then get the house under contract.  Then they sell the contract to purchase the home at the specified price agreed to with the seller to people like me. 

 

They do "we buy houses" signs, direct mail, google ads, whatever it takes.  

 

I also find deals myself.  If I'm driving down the street and I see a place that looks in horrible condition, I'll jot down the address, do a county records search for the owner (very often they're rentals) and shoot them a letter asking if they'd be interested in selling.  

 

Even then, not an easy job as few people are in the mood to see the exact instant you happen to contact them.  I'll put them into a marketing schedule and mail them every month or two unless they request that I stop.  

[digibum]

1 hour ago, bazza73 said:

An interesting rule. I thought the rule for exchange traded options was you make money when you  sell, not when you buy.

Somehow, I think your time frame for refurbishment and selling is somewhat optimistic. 2-3 months for a flip? This is Thailand.

Maybe possible in Pattaya or Phuket. Chiang Mai? There are probably glaciers that move faster.

 

 

Dpeends on what you're hoping the underlying security will do.  If you own the stock and you're selling calls, sure.  Nice little income stream unless you get the stock called away.  

 

But in many ways, real estate is like the underlying asset behind an option.  I don't want to buy a stock that is fully valued.  That's the retail price.  I want to buy a stock that is undervalued and has potential to realize its actual value.  

 

There's a reason why the real money is made pre-IPO.  But since most people don't have the kind of capital that a VC or hedge fund have they buy at retail prices post-IPO.  

 

Ultimately in real estate there's a maximum price the market will pay for a house.   You're making your money by buying the house such that your cost plus renovation costs are less than the retail price of similar homes.  And if you can do that with 25% or better Cash on cash ROI then you can probably make some money doing it.  Anything thinner than that and one or two missteps will wipe you out.  

 

Im in the middle of a flip right now.  Gutted the place.  Total repair time will be about 4 weeks.  

 

Granted, in Thailand that might be hard to come by but you can structure their compensation to incentivize timely completion.  

[Destiny1990]

20 minutes ago, digibum said:

 

Well, finding out how to go about that in Thailand was one of the goals of meeting some flippers on here.  

 

In the US, I have wholesalers who market like crazy to find these properties and then get the house under contract.  Then they sell the contract to purchase the home at the specified price agreed to with the seller to people like me. 

 

They do "we buy houses" signs, direct mail, google ads, whatever it takes.  

 

I also find deals myself.  If I'm driving down the street and I see a place that looks in horrible condition, I'll jot down the address, do a county records search for the owner (very often they're rentals) and shoot them a letter asking if they'd be interested in selling.  

 

Even then, not an easy job as few people are in the mood to see the exact instant you happen to contact them.  I'll put them into a marketing schedule and mail them every month or two unless they request that I stop.  

Most Owners here will not sell their property with a loss i think they rather die or wait 25 years?.most chance is with forced sales by banks and auctions once a while u might bumb into a bargain then.

[williamgeorgeallen]

5 hours ago, digibum said:

 

Thanks.  Sounds like the market is topping out a bit.  

 

selling is very difficult. thais would rather knock down a good building and put up a new one. i have seen them do it. often the building is not an asset so improving it is throwing money away. i am not going to go into the problems of renovating. selling my houses i only had westerners come to look at it and i doubt most of them had the money to buy it. compounded now is all the new apartments being built. market is flooded and they are driving down property prices. quite frankly after 10 years in thailand i would not own anything there again. i would rather rent everything.  i mean everything. scooter, apartment, girl, everything. thailand is an excellent place to live but keeping mobile is the key to being stress free.

[cyberfarang]

2 hours ago, digibum said:

 

I don't necessarily hate that idea but I do have plenty of questions I would like both my US and a Thai lawyer to weigh in on.  

 

Most states in the US are community property states so whether her name is on the title or not, she's entitled to half (or more - f'ing lawyers) so some level of trust is implied :-)  

 

I really don't care how it's structured.  I only mentioned that she could hold the land in her name as many people assume that once you say anything about owning land they flip out and tell you that you can't own land in Thailand.  I get that.  I didn't just get off the plane yesterday.  

 

Worst case scenario is she buys it as an individual in her name, pays Thai taxes on the proceeds, investment capital goes into and out of Thailand as needed, but profits stay in Thailand.  All of that, AFAIK, would be perfectly legal.  If we can set it up with less red tape via a corporate entity, great.  But none of what was suggested was in order to avoid taxation.  

 

Glad you might consider the idea, that I think is the most viable method. Some years ago I knew an Australian guy who`s Thai wife lived with him in Ozzie land and they had 2 children together. His Thai wife and children had both Australian and Thai nationality. when he first married his Thai wife, the couple settled in Melbourne. He already had a house there and later changed the land title deeds into joint names with his wife. Several years later he and his wife began a real estate business in Bangkok. The company was all placed into his Thai wife`s name and already having an Australian property in her name claiming it as an asset plus joint bank accounts in Australia with her husband, she could claim that all the business interests in Thailand were bought with her money. Hubby stayed in the background on paper. The couple turned their Bangkok project into a huge thriving business, dealing in properties both in Thailand and Australia. Profits were going here, there and everywhere with no problems. Definitely an option well worth considering.

[digibum]

32 minutes ago, Destiny1990 said:

Most Owners here will not sell their property with a loss i think they rather die or wait 25 years?.most chance is with forced sales by banks and auctions once a while u might bumb into a bargain then.

 

Yet again, words being put into my mouth.  Most of the people I buy from are not upside down in the property.  In fact, most own the place outright which is why they can afford to take a hit selling it.  

 

Typical scenario is an out of state landlord with tenants from hell who have destroyed the property and he probably had to evict.  They haven't received rent in 6 months and now they're looking at thousands just so they can rent it out to another deadbeat or tens of thousands to get quality renters.  

 

Then someone one like me says, "Hey, how about I take this problem off your hands?"   

 

Or, you find out a property is in probate (owner died) or tied up vacant in a divorce.  You come in and offer to pay cash and close in 7 days vs having to do renovations to get it into retail shape, list it, wait for offers, wait 30 - 45 days for escrow to close.  my offer might not sound too bad to people who just want the cash without the hassles.  

[Don Mega]

13 minutes ago, digibum said:

 

Yet again, words being put into my mouth.  Most of the people I buy from are not upside down in the property.  In fact, most own the place outright which is why they can afford to take a hit selling it.  

 

Typical scenario is an out of state landlord with tenants from hell who have destroyed the property and he probably had to evict.  They haven't received rent in 6 months and now they're looking at thousands just so they can rent it out to another deadbeat or tens of thousands to get quality renters.  

 

Then someone one like me says, "Hey, how about I take this problem off your hands?"   

 

Or, you find out a property is in probate (owner died) or tied up vacant in a divorce.  You come in and offer to pay cash and close in 7 days vs having to do renovations to get it into retail shape, list it, wait for offers, wait 30 - 45 days for escrow to close.  my offer might not sound too bad to people who just want the cash without the hassles.  

 

My previous landlord needed money and asked if I would be interested in buying the house for 4 million (others in the village for sale for 4.75m) which I thought was a great price but the whole "foreigners cannot own a house" deal forced me to say no so he asked if I would break lease and move out so he could do some renovation work and put it on the market.

 

3 years later it is still sitting empty with a for sale sign hung on the gate.

 

 

[cyberfarang]

1 hour ago, Don Mega said:

 

My previous landlord needed money and asked if I would be interested in buying the house for 4 million (others in the village for sale for 4.75m) which I thought was a great price but the whole "foreigners cannot own a house" deal forced me to say no so he asked if I would break lease and move out so he could do some renovation work and put it on the market.

 

3 years later it is still sitting empty with a for sale sign hung on the gate.

 

 

Good post and agreed.

 

My Australian friend and his Thai wife, as I mention in my previous post, went into the real estate markets or as us English say; they became estate agents. Customers buying new developments and they earned big time from commissions.  I can remember my friend saying to me; going into the property buying and selling business, he wouldn`t touch with a bargepole. I read that the Thai property resale market is one of the worse in the world.

[trogers]

Flipping - buy low sell high, in the shortest possible time.

 

Would work near the bottom of a property cycle, like 2009 to 2011 in the US. Why not continue flipping now in the US during the present upswing?

 

And is Thailand now near the bottom of a downswing?

[mjnaus]

14 hours ago, Kabula said:

 Do you even know what a derivative is? 

Excellent point. But do you know what a Acromantula is?

[newnative]

7 hours ago, bazza73 said:

That's because in many cases they will tear the apartment down to floor level and do a complete refurbishment.

Possibly one can make money in Pattaya and Phuket flipping condos. In Chiang Mai, you're probably going to do better at the racetrack.

In our case, the 3 sales to Thais were condos the Thais planned to rent out and not live in themselves so maybe they didn't care about them being second-hand.

[newnative]

7 hours ago, Destiny1990 said:

Interesting but it can only work if u can buy such a unit at a bargain price and in a deplorable condition.U buy them from the auctions and or from banks?

Only 1 from a bank, none from auctions.  Most of the rest from developers, a couple from private owners.

[Peterw42]

I think people are missing the fundamental aspect of Thai's and second hand property.

 

NEWS FLASH: THAI PEOPLE BELIEVE IN GHOSTS

 

Not sure if anyone has noticed the "spirit houses" in the front yard of every house in Thailand. This is not only acknowledgment that they believe in ghosts, they build special houses for them to live in. 

 

A spirit house is for the spirits to live in, there are usually two houses, the bigger higher up one is for bad or lost spirits to live in, the smaller lower down house is for the former occupants to live in. 

 

A spirit house is a permanent structure and stays with the property. I have seen a house demolished in the middle of Bangkok and replaced with a 10 story building "BUT" the spirit house remains.

 

This belief system has a huge impact on the 2nd hand house market, its a bit like buying a house in the west and it comes with a granny flat and a granny living in it, and you have to take care of her and sell her with the house in the future.

 

How can you flip houses when, so far as Thais are concerned, uncle somchai still lives there. Not to mention a couple of bad ones that may have moved in.

 

[Destiny1990]

5 hours ago, digibum said:

 

Yet again, words being put into my mouth.  Most of the people I buy from are not upside down in the property.  In fact, most own the place outright which is why they can afford to take a hit selling it.  

 

Typical scenario is an out of state landlord with tenants from hell who have destroyed the property and he probably had to evict.  They haven't received rent in 6 months and now they're looking at thousands just so they can rent it out to another deadbeat or tens of thousands to get quality renters.  

 

Then someone one like me says, "Hey, how about I take this problem off your hands?"   

 

Or, you find out a property is in probate (owner died) or tied up vacant in a divorce.  You come in and offer to pay cash and close in 7 days vs having to do renovations to get it into retail shape, list it, wait for offers, wait 30 - 45 days for escrow to close.  my offer might not sound too bad to people who just want the cash without the hassles.  

U need to stop talk about your USA property buying scheme as it not relates to Thailand!By the way u can not even own house with land here just so u know!

[Destiny1990]

38 minutes ago, newnative said:

Only 1 from a bank, none from auctions.  Most of the rest from developers, a couple from private owners.

Okay so than these (new)units that u buy of the developers they barely need any renovation i guess just some curtains and a tv at the most.How is it you can find a buyer who pays u significant more and the develop can't find them?