Property Exchange

[TypicallyTropical]

Is property exchange legal in Thailand? I own a house in Hawaii appraised at $280,000 that is an investment property. (It's a rental.) If I sell it I'm hit with a capital gains tax, but if I exchange it for something at equal or greater value than there is no tax due. I know it's a slim chance to find somebody to exchange with in the Hua Hin area, but in case if I do, I want to make sure it's legal. (I'm looking for a condo there.)

[tonymaroni]

I believe it would have to be property in the USA. Exchange with Thai property and doing an appraisal in Thailand would be suspect to say the least.

You can check on that but I seriously doubt the IRS would accept an appraisal from Thailand. Do we even have licensed property appraisers here, I do not know.

Doc
(formerly from Hawaii)

[TypicallyTropical]

Thanks Toni about the IRS, but I already checked with them, it's OK since it wouldn't be a 1031 Starker Exchange. My concern is about the legality in Thailand, since I was told even when buying a property there the funds have to come from the same name account as the name the property is being bought under. There would be no funds coming in an exchange and that's why I asked. It's OK with the IRS in the USA and no appraisal is needed.

[tonymaroni]

Really?

I am not sure that is correct.
Did a quick search on net.
Pages and pages of url's that say NO.

Like this

"Whether the land is productive, improved or unimproved is not relevant as long as it has been held as an investment. Any mixture of office buildings, parking lots, apartment buildings, shopping centers, retail stores, hotels, motels, farms and ranches or unimproved land may be exchanged. 1031 Exchanges are limited to property in the United States since an exchange into foreign property was disallowed in 1989. A vacation home or second home that is not held as a rental usually does not qualify for a 1031 Exchange."

Actually I was surprised to find out before 1989 it was allowed.

Doc

[TypicallyTropical]

As you probably know, there are exemptios to every rule and knowing the back doors helps!
BTW, the 1031 is still applicable to foreign properties as long as the exchange property is foreign too.

[tonymaroni]

I did read that in my search.

So with all the added barriers to owning real estate in Thailand are you still keen on acquiring some?

I'm speaking of No licensed Realtors, No Escrow, No Title Search, etc. etc.

I owned property in Kona before moving over here, but all the desire has gone out of it for me, after seeing so many friends with Real Estate problems here.

Doc

[migrant]

I've seen 1031 exchanges here in the states to international properties. To do so does require a few additional steps.

BTW TT you may want to check Hawaii law. Here in Califonia one cannot exchange to international property so you could trigger a state tax.

As with many 1031 exchanges the accomodater takes the property, and giveth. I'll check about any that do international exchanges and let you know.

[TypicallyTropical]

So with all the added barriers to owning real estate in Thailand are you still keen on acquiring some? I'm speaking of No licensed Realtors, No Escrow, No Title Search, etc. etc.

I have owned properties in several countries with similar situations, I'm not worried. BTW, according to my research, there are escrow companies in Thailand.

[TypicallyTropical]

I'll check about any that do international exchanges and let you know.

Tanks Ace, I have a 1031 Exchange Facilitator I have been working with for 15 years now, but I am NOT planning to do a 1031 exchange. The purchase contract would indicate an exchange property in value instead of monetary funds.

[tonymaroni]

I have owned properties in several countries with similar situations, I'm not worried. BTW, according to my research, there are escrow companies in Thailand.

Never seen one here. Never heard of one used. Have never found an address, telephone number, for one here?? I'm surprised. I have seen mention of local lawyers who set up offshore escrows. I agree escrows are the way to go. The government has agreed to that to. But seems to have never gotten off the ground here.

I've forgotten TT are you from the Big Island or Oahu? Buddy of mine here is, was, an Exchange Facilitator in Hawaii, J. Clay from Kona. Perhaps we worked with same guy.

Aloha

Doc

[TypicallyTropical]

I've forgotten TT are you from the Big Island or Oahu? Buddy of mine here is, was, an Exchange Facilitator in Hawaii, J. Clay from Kona. Perhaps we worked with same guy. Aloha, Doc

Small world Doc, I live in Kona and I have known Jim for like 20 years! He is not my 1031 facilitator, but we have done business together and we just had lunch together like a month ago!

[Krisian Olsen]

this may be the new big thing !

[Krisian Olsen]

Or maybe not !

[TypicallyTropical]

It doesn't matter either way, the house is sold. However, I still have a nice golf course lot!