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It is a good time to buy property in Thailand. Banks are lending and houses are and land are now realistically priced in 2006.A good time to buy.
LAND AREAS: 1 rai = 4 ngarn = 400 wah2 = 1600 m2; 1 talang wah = wah2 = 4 m2; 1 acre = 2.53 rai & 1 ha = 6.25 rai
A 30-year lease can be a good idea to a freehold purchase or usufract, or a Thai company (7 PARTNERS) can be established with Thai majority shareholders. Foreigners only own 49% shares in a company with foreigner ownership. We can assist you to make sure your company is safeguarded. Remember if you need advice ask us.
NEW LEASE LAWS IN THAILAND:
The government is looking into changing the leasing laws to increase foreign investment. This may mean leasing land held in Trust by the Land Dept guaranteeing the foreigner right to tenancy. Leases would be 99 year. The occupant would be able to sell the lease to another foreigner before it expired but if sold to a Thai then they would get the title as the Land Dept would give the title back to the original owners before the transaction proceeded. Whether this is a good idea is yet to be seen. Current requirements allow foreigners who bring in 40m baht to buy 1 Rai of land for residential purposes. They can lease 100 Rai for approx 50 years. Longer lease requires permission from the Land Dept.
On March 3rd 2000 the Thai Foreign Business Act of 1999 took effect. (FBA). This replaced the old Act of 1972.In a company you need 7 partners but you can according to the investment control 100% via B.O.I. (Board of Investment). However a normal 2m baht Thai Company foreigners can have 6 foreign shareholders & 1 Thai but the Thai holds 51% shares & now have access to the company account. What one does not know until they decide to form one is that certain businesses are closed to foreigners BUT THIS IS OF NO CONCERN IF ONE JUST WANTS A COMPANY FOR THE PURPOSES OF BUYING A HOUSE AND LAND but remember buying a house via a company your Thai workers will be interviewed and you must carry out business. We can help you form the company and take care of all steps for you plus search the Title Deeds & any other request like making sure their is no lien on the property. We also check the Courts for you in case the seller has a not so good record.
THAIS MARRIED TO FOREIGNERS - the answer to your land buying problems?
BOI allows foreign companies to own land, usually factories. Don't forget the Treaty of Amity, which virtually gives Americans the right to own 100% of a company doing business in Thailand. The Japanese use nominees a lot. There are people that buy in someone elses name and put a mortgage on the property for the purchase price to protect their interest. There are also concurrent land leases that can be set up, as there is no restriction on foreigners owning buildings (40% of a condo complex) and lastly theres those who trust their wife or friend & use their name. Laws are worthless without enforcement, & Thailand practices "selective" enforcement. Foreigners can buy property in Thailand & please use a lawyer as sometimes Title Deeds are false, or the building you buy is not on the deed or the land has encroached on other land.
Most farangs use their Thai wife and give property rights to them. But if not married to a Thai lady then you can have a 30 year rental. Rental total fee equals the purchasing price. At expiry date, a second 30 year rental period is granted at zero-cost to the rentee that being you. The rental-contract is written in English and acknowledged by a lawyer. This deal is a person-to-person basis. Problems may arise at expiry date between heirs of both parties.
1/. Be careful. Check utilities as sometimes theres no phone lines & never believe it until you have written proof of phone lines are going in.
2/. Learn which areas flood and which don't. A developer will not tell you. Don’t listen to pub talk. Rent before buying if you have time or ask the neighbours.3/. A land lease NOT filed with the land department (and 1% fee paid) is only valid for 3 years regardless of the term of the lease. All lease for a period over 3 years MUST be registered at the Land Office and written in Thai. You have also to pay fees calculated on the TOTAL amount of rent agreed upon and for the full period (eg.: rent 1000 baht x 12 months x 30years = 360.000 baht)Those who want to sign a lease-contract and don't want to register it, should know that such a contract is automatically void at the death of one of the signatory (this means that such a contract is NOT transmissible without prior agreement of the other party.)While a contract registered at the land office is transmissible & if one signatory dies, & the contract is not cancelled, the heirs of the estate have to respect it. This is Ok if the lease is transferable and every time a transfer is made, the Land Office must be notified.
If no record of your lease with the developer, then any private agreement between the 2 parties will not be legally binding. If the developer wants to play you out, he can. The Land Office uses only one language - Thai. Even your name in the contract has to be in Thai. The "fee" is actually government tax & you pay the Land Office equivalent to a little under 5% purchase price. A developer may want a "deposit" equivalent to 1 year's maintenance fees. They say you recover this amount from the person who buys the property from me. But ask your Thai neighbours if they pay it as you will find they don’t- its rubbish. Confusing-------- thats why you need our law office.
Foreign businesses can feel relaxed now as the Act Governing the Lease of Immovable Property for Commercial & Industrial Purposes has increased from 30-50 years & allowed lease rights to be mortgaged as security. For investors this means: a longer lease can accommodate long term business planning & the right to mortgage the lease as security in order to receive finance. Financial institutions can benefit because they can take a lease right as security.Regulations: 50 yrs now. Only applies to immovable property for commercial & industrial reasons. Only the owner can lease it. Lease must be in writing & registered.The Government Gazette Aug 2000: says the business must have one of the following.1/. Commercial business with at least 20m baht in investment2/. Industrial businesses qualify for promotion under the Investment Promotion Act.
3/.Other commercial or industrial businesses beneficial to the economy. property leased must be located in industrial are as set out in the City Planning Act or the Industrial Estate Authority of Thailand. Land Dept must approve leases over 100 rai. Foreign leases must comply as well with the Foreign Business Act. Leases can be renewed after 50 years for another 50 years. If the lessee dies the inheritor can take over. The lessee can sub lease or transfer lease rights, either wholly or in part, to a third party.
MORTGAGE OF LEASE RIGHT:
Since a lease right can be mortgaged, if the debtor defaults on payments the lease may be seized & sold at a public auction. Mortgagee may claim: 1/. The debtor has failed to pay interest for 5 years; 2/. Mortgagor hasn't satisfied the court that the value of the property is greater than the amount due & 3/. There's no other registered mortgages or preferential rights on the same property.
TO LEASE A HOUSE & TO LEASE LAND
We firstly check the title Deed & check any liens on the said property. Then we take the lease to the Amphur together with the nor sor sam or Kanut and have it registered. It is then stamped & the land cannot then be sold unless the lease is cancelled. A lease without doing this is useless. The first lease should be done properly by a reliable lawyer. (We charge 10,000 baht ). Our lawyer takes the title deed to the Amphur and gets it legalized. The wife or owner should then sign another 30 year lease dated from the end of the first one. Most wives would agree to these procedures by explaining to them that if they died, they would not want their husbands thrown out! At the end of the thirty year lease, all you have to do is get a lawyer to take it to the Amphur again. It is really simple. A virtual 60 year lease should cover most peoples lifetime and the wife can leave the property in her will to the children and if you die the lease could be terminated and the property go to your children. You can also sell a lease.
DOING IT YOURSELF: You can register a 30 years lease at the land department yourself and amend it but most times you may be better to use a lawyer as the lease will be in Thai. If you cannot read Thai then you do not know what you are signing. Your name will appear in the title and no one can cancel your lease.
LEASING AS AGAINST USING A COMPANY:
It depends on ones circumstances whether you should lease rather than form a Thai company to secure ownership. In some cases when married to a Thai, leasing is the better option or for pensioners or when in a relationship but if one decides they may start a business later or during, then a Company may be the way to go. Remember you can only own 49% land in Thailand regardless. A US Amity Treaty company gives no more clout---its 49% foreign ownership. But also remember if you start a company you must use the company for business not just as a convenience to own the property. Taxes will be levied and you will need audited yearly accounts. Condos are the only allowance for 100% ownership. If you are using someone's company then that is fine as normally you will have contracts to assist both parties. Charges would be: pay all taxes per year; maintenance payment; pay tax on profits if sold; yearly audit contribution so expect to pay the company for this service; in & out fees and payments.
LEASING VIA A LOAN TO YOUR COMPANY:
This is an excellent way to lease if you have a company. An owner takes a lease out on a particular piece of land he wants to own with his own money? he loans his company money to buy the land and the lease in effect is owned by the company via the buyer. This then becomes an asset of the company and can be depreciated from his or her share registration & paid back at the buyer's pleasure. You must have audited books to access a loan from a Bank.
25 YEARS IN THE REAL ESTATE BUSINESS IN CHIANGMAI WITH FOREIGN
& THAI STAFF WE SPECIALIZE IN ASSISTING FOREIGNERS AND THAI
IN EVERY FACET OF BUYING PROPERTY IN THAILAND TO PROTECTION & INSURANCE
MAKING YOU FEEL AT HOME. OUR NEW APPROACH IS A SAFEGUARD
LEASE, SELL TOP END PROPERTIES, FACTORIES, SPECIALIZING IN COMMERCIAL PROPERTIES TO RESORTS; HIGH END HOMES & LAND PLUS FACTORIES & CAN SOLVE YOUR PROBLEMS IF YOU BUY YOURSELF USING OUR LAW SERVICES.
NO HIDDEN COSTS TOTAL DISCRETION WITH OUR FOREIGN PARTNERS. IN BUSINESS OVER 25 YEARS.
WHY USE OUR SERVICES:
COMPANY INDEMNITY: Our Company does not conduct conveyancy of property sales, title searches and lease agreements as we use our Law Office to do these. If you do not have a lawyer then we can advise you & recommend one. All conveyancy procedures in Thailand should be conducted by a qualified Law Office and we do not advise you to use any of our Company staff nor others to assist you even though you feel they may cut corners for you or save you money. Our Company is not responsible other than assisting clients to purchase, sell, rent or lease & we will not be held responsible or accountable. Feel free to ring us if you have a problem & require advise about our services or you are not sure what you are signing: Ask to speak to our Manager:
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