buy or lease house

[Super Joe]

I am being asked if I would prefer to OWN the house that is on the leased land or LEASE the house that is on the leased land

I can't really understand why someone would not choose ownership!? Buildings like houses, villas etc can be entirely separate entities to the land they sit on. And foreigners have the legal right to register or transfer ownership of them via the land office. They have no title documents, but you get a certificate of registration document from the land office.

I am about to complete the purchase of a villa. I am not Thai so I will have a 30 year lease on the land with provision for 2x more 30 year periods.

There are various legal structures open to foreigners for securing rights over the land, our individual circumstances will generally dictate which option best suits. Your situation may be set by your current agreement, but personally I would look to include 'Superficies' or 'Usufruct' rights together with the land ease, as they include certain rights not included in a lease.

Superficies and Usufructs are centuries old Civil Law property rights that are used in France, Germany, Holland, Switzerland etc, and included in Thai Civil Law, making them 'real rights' as opposed to 'contractual rights', so get registered against the land and not the landowner, and follow the title to new owners, heirs etc. They can both be registered for the lifetime of the foreigner, so a handy alternative if you outlive the 30 year mark!!


Extract's from Thai Civil law on superficies:
Section 1410. The owner of a piece of land may create a right of superficies in favour of another person by giving him the right to own, upon or under the land, buildings, structures or plantations.
Section 1411. Unless otherwise provided in the act creating it, the right of superficies is transferable and transmissible by way of inheritance.
Section 1412. A right of superficies may be created either for a period of time or for life of the owner of the land or the superficiary.
Section 1416. When the right of superficies is extinguished, the superficiary may take away his buildings, structures or plantations, provided he restores the land to its former condition.
If instead of permitting the removal of the buildings, structures or plantations, the owner of the land notifies his intention to buy the at a market value, the superficiary may not refuse the offer except on reasonable ground.

SJ

[margaretcarnes]

OK ... let me try again. I am about to complete the purchase of a villa. I am not Thai so I will have a 30 year lease on the land with provision for 2x more 30 year periods. I am being asked if I would prefer to OWN the house that is on the leased land or LEASE the house that is on the leased land

First I'd be questioning why the owner is now presenting you with an option. Has he realised that he might make more money on a leased villa over the 30 years? Or has he decided that he doesn't want to commit to 30 years for a one off purchase price for some reason?
The cynical side of me is saying that his family have had some influence and might have plans for the future tenure of the property. Perhaps second thoughts even. Is the land in an area which could be ripe for other development before long?

Second I'd be asking whether you are likely to want to live in the villa for 30 years - and in the event that you die before that do you plan to leave the property to next of kin? Do you have children to a Thai who could benefit from it? If so that puts a different perspective on which deal you choose.

[pinsharp]

Again ...thanks for the input. The villa is on a development and I only have UK children and wife. The developer told me that I might save money if I chose to lease and sold the property at a later date .. does this mean there are better tax deals if you are leasing a house ??