Ask here about the pleasures and pitfalls of buying, selling or renting property and real estate in Hua Hin. Building, design and construction topics welcome. Commercial or promotional posts for real estate companies or private properties are forbidden.
On a different thread, Pete made the folowing comment:
Condo sales in Pattaya are off the charts during the last two months. Villa sales are worse than during the 1997 crash. Trust your wife, trust your girlfriend, or do a leasehold. Foreign money for landed property has come to a full stop.
So what is happening in HH? When I was there in Sept/Oct everyone was looking forward to the high season and anticipated buying frenzy; but has that happened. What effect has the government's undecipherable monetary policy, the bombings in BKK, and the increase value of the bhat had on local home prices and farang demand?
To clarify what may be yank lingo to some, "off the charts" means extremely strong.
The pattaya situation apparently is so dire concerning villas, the Bangkok Post saw fit to do a full page story on it a week or so ago entitled something like "...is the pattaya boom over....? Pete
This is a personal speculation based on my view of how the changes in accounting and banking regulations that occurred last year may impact on the property market this year – please note that this is a completely separate issue to that of the withholding tax which has its own additional impact.
Some of you may have noticed that following the application of more stringent rules by Bank of Thailand on Thai Banks that all the banks are reporting substantially lower profits.
This is largely because considerable additional provisions have been made by the banks against their “Non-Performing Loansâ€
In my opinion there is no real high season in terms of buyers. Its pretty consistent all year round. We get more people right now, but many are first time lookers and not that serious.
The market right now is steady - not booming. 10 of my last 12 customers have taken a lease agreement, all have taken there own legal advice.
Agree with JW, it is steady and the serious buyers come all year round, there are more viewings around December/January but many are just interested in being driven round for a look about on a grey day.
Also more people are going for the lease option now, that's the general advice solicitors are giving them these days.
Most buyers that come over do not even know they have to lease or set up a Limited Company, let alone what a nominee shareholder is.
I presume that they have a clause in the contract that says 'If the law changes then the lease is void and the property becomes the ownership of the buyer or the buyers nominated preference'
If that's not the case the developers will be much more wealthier in 30 years time!
I would imagine it's not that different from England.
So, for instance, I bought my property in London 17 years ago on a 120 year lease from the council, who are the freeholders.
So, I only have 8 years to run on my mortgage ( it was 25 years as normal), then the place is "mine". But there's only 95 years left on the lease. If I want to sell now, or in the future, a 95 year lease is still very attractive to a buyer. However, if the term of the lease falls below 50 years, then we're starting to talk.
That was why the law was changed donkey's years ago in England. Leaseholders have the right to purchase the freehold.
How can and does this work in Thailand?
Yes you have the option to purchase at any time during the lease term, whether the law changes or not, for a fee of 1% of the rental cost. (This option is not covered under standard Thai lease law), so make sure you have it written in. Any decent lawyer would anyway.
You also have the right to 'Succession and Assignment', ie: if you die the lease rights go to your heirs. Or you can sell on the property/lease with whatever duration is left on it.
You can also tear up the existing lease and make a new 30 year lease anytime you want, ie every year, every 5 years etc, providing land owner agrees (if it's your wife and she still loves you madly, why wouldn't she )
Burger wrote:
You can also tear up the existing lease and make a new 30 year lease anytime you want, ie every year, every 5 years etc, providing land owner agrees (if it's your wife and she still loves you madly, why wouldn't she )
Burger
Burger
I would have thought the buyer was the land owner realistically and has to go the lease route because of the law. Is it not the case that you buy the land using the third party who then leases it to you at a nil fee or you arrange a nil fee somehow and then your contract allows you to play around with the lease to your hearts content. Therfore''providing the land owner agrees' does not come into.
Sorry Jimmy, I don't quite understand what you mean.
The property buyer is not the land owner in a lease situation.
If you mean by 'third party' your wife etc, then they still have to agree to you having a new lease (but should be easy if marriage is well).
Re: Fees (so Im told, but don't quote me on it) you have to pay certain fees at the land office each year otherwise the lease is void.
Sorry, amonst the above, is it right to say that some people are paying to have a house built on land leased for 30 years from a company, maybe the developer?
So that, cutting through all the why's and wherefores, at the end of 30 years, you can get kicked off with no comeback?
Did I read that right?
In such cases, what could you expect to pay as the lease?
Why would anyone do that, unless with suficient funds, so its not an issue?
In such cases, what could you expect to pay as the lease?
Say you buy a 5M Baht house from a developer, the house costs 4m and the land 1M.
The 30 year lease fee is therefore 1M and is paid upfront (when you register the lease at the land office).
So in effect the lease does not cost you anything extra, apart from some taxes at the land office each year.
So that, cutting through all the why's and wherefores, at the end of 30 years, you can get kicked off with no comeback?
You have a legally binding contract with the land owner/developer that they will extend your lease for a further 30 years.
Or you can exercise your right to purchase at any time.
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