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Buying off plan? A few things to consider.

Legacy Phuket Gazette

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Buying off plan? A few things to consider. | The Thaiger

Many developers offer units and condo “off-plan” for sale at an early stage of the project development, even before the first brick has been laid. The lure is usually a lower price and getting the pick of the best location in the development.

Some of us may not be familiar with the term “off-plan”. Generally speaking, buying off-plan means buying units which exist only on the drawing table, construction of the project may not even have started. Off-plan sales are offered by developers as they often need to sell their product fast by pricing units extremely low in order to achieve fast and valuable finance to proceed with constructing their development.

Purchasing an off-plan unit may have considerable advantages compared to an investment in a completed project. Early birds may benefit from a significantly reduced price, which makes such off-plan purchases extremely interesting from an investment perspective as such units may rise in value during construction, even prior to completion.

Smart payment plans, typically a minor deposit payment, followed by a 30% first installment and a high final payment upon title transfer, allow buyers to effectively secure a high-value asset for a relatively low initial capital outlay. Furthermore, purchase at an early stage of a project ensures that a buyer can choose the best located units in order to satisfy his individual requirements as well as a future buyer in regard to a resale.

Buying off-plan also offers the chance to “flip” a unit prior to title transfer by way of assignment of the buyer’s rights under his/her sale and purchase agreement, which allows investors to save on transfer fees and taxes that occur from title transfer.

Summarised, such off-plan investment may create a “win-win” situation for both buyer and seller: buyers obtain a low price for a quality product with high resale value and sellers are able to receive fast project finance.

However, in order to secure your investment, due diligence should be ALWAYS be carried out to minimise risks and to prevent you from a worst-case scenario – a total loss of your invested funds. Basically, such due diligence should be conducted by a reliable and reputable law firm, whereby appointment of additional experts, such as a surveyor, might be recommended depending on individual requirements.

The importance of such due diligence, particularly when buying off-plan, in part arises from the fact that extremely important points – such as secured access, lawful title to the project’s land, as well as an
accurate application for the required construction permit or licenses – may not have been accomplished, completed or sufficiently verified by a developer.

Additionally, the financial stability of a developer offering such off-plan sales should always be of concern. In this context, the fullest attention should be paid to the reliability and track record of the developer. A professional real estate agent, representing only well reputed developers and ideally having the financial backing of big investors, can be the first credentials to look for to separate the wheat from the chaff.

Simply put, off-plan buying can be an interesting and promising investment, but extensive market research, awareness for potential risks, comprehensive due diligence as well as consideration of generally accepted risk management is mandatory to find the right product, which seems not only to be a bargain, but also fits with your personal requirements on a safe investment.

Select from over 7,000 properties in Phuket at property.thethaiger.com

This article was written by International Law Office Patong Beach. For any questions you can contact ([email protected]) or call ILO’s office 07 6222 1915.

International Law Office


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Bangkok

Calls to restrict foreign property purchases in Bangkok

The Thaiger

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Calls to restrict foreign property purchases in Bangkok | The Thaiger

Dr. Sopon Pornchockchai, the President of the Thailand Agency for Real Estate Affairs, is calling for controls to restrict foreign property buyers.

Thailandproperty.news is reporting than he is justifying his comments saying the growth in income of Thais is slower than the property price rises being pushed up by high foreign demand.

“Some measures should be adopted, such as higher stamp duty for foreigners,” he said.

The article says that this is the first time an industry figure has spoken out about the need to restrict or reduce the amount of foreign investment in the Bangkok property market. Dr. Sopom says he believes that foreign buyers account for around 20 percent of all Bangkok property purchases.

He noted that Chinese purchases account for about 80 percent of foreign buyers.

Read the original story HERE.

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Property

Goodbye – Evicting a tenant in Thailand

Robert Virasin

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Goodbye – Evicting a tenant in Thailand | The Thaiger

It’s a goal for many people to become a landlord. They purchase property for the purpose of renting it out for passive income. The property owner interviews prospective tenants and ensures that they sign a lease agreement and put down a deposit. However, all of this doesn’t prevent bad tenants from revealing themselves after they have moved into the property – all the smiles can disappear once they get the keys.

There are several possibilities. The tenant may stop paying the rent, the tenant may not maintain the property or theymay violate the terms of the lease, such as allowing multiple families to move in or allowing pets to live in the home.

So what does the landlord do and what are your rights?

The first thing the landlord needs to do is to review the lease agreement. The lease agreement generally contains the terms by which the tenant agreed to abide. A properly prepared lease should contain the grounds for termination of the lease and the notice requirements for eviction, if the tenant does not respond to the notice.

It is also important to review the length of the lease agreement. If the end of the lease term is near, it might be easier to just send a notice to the tenant that the lease is not going to be renewed and the tenant will be required to leave the premises at the end of the contract.

There are many foreign nationals who lease property on a 30 year lease. One of the important elements of a 30 year lease is that it must be filed with the local land office. Under Section 528 of the Thai Civil and Commercial Code, if the lease agreement is not in writing, signed and registered with a ‘competent official’, then it is not valid for more than three years or the life of the parties.

After the end of the lease period, the lease agreement is generally extended for an indefinite period. This allows any of the parties to provide notice of termination of the lease with a minimum of one rent term or maximum of two months notice. If the tenant refuses to leave the property, the landlord can file a lawsuit against him.

If the landlord is able to establish in court that the tenant violated the terms of the lease agreement and that the landlord abided by the legal requirements for eviction, the court will rule in favor of the landlord, unless there are extenuating circumstances. If the tenant refuses to abide by the order of the court, the landlord can request an enforcement of the judgment.

The landlord can then request that police remove the tenant from the premises. They can also terminate electrical and water services to the property. It is important to note that the landlord cannot enter the property, remove the tenant’s belongings or change the locks on the door, unless it is allowed within the lease agreement, or with a court order.

During the entire legal process, the landlord can file a claim for the rental costs and opportunity costs as a result of the tenant refusing to leave the premises.

Leasing property is a popular way to obtain passive income or to pay for mortgaged property. However, as with any type of income-generating business, there are risks, especially in a foreign country. For landlords, there is the possibility of renting to tenants who do not maintain the property, violate the rules of the lease agreement or stop paying the rent.

The legal process for evicting tenants is painstaking and can take many months. It is important to scrutinise potential tenants and check their rental history and current financial status prior to entering into a long-term lease agreement.

Additional reporting by Yutthachai Sangsirisap.

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Koh Samui

Stunning new Lux Neo project at Chaweng, Koh Samui

The Thaiger

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Stunning new Lux Neo project at Chaweng, Koh Samui | The Thaiger

Sun, sea, new, views, pool villa, Samui. All the words you want to hear.

Lux Neo is now available, combining stunning sea views and outstanding modern design. Lux Neo is the newest award winning project by the “Neo” team with critiqued unique villa design and award winning styling. Click HERE to read more about the Neo design team and some of their other award-winning projects.

Stunning new Lux Neo project at Chaweng, Koh Samui | News by The Thaiger

This magnificent site offers a unique combination for in Thailand – inspired design, value, astonishing views and quality. Designer two or three bedroom villas are now available with sea views to Chaweng Noi and just minutes to the main attractions, beaches, shops, airport and the main Chaweng shopping and beach areas.

The “Lux” location is 18 Rai of premium Chaweng Noi sea view land with “Neo” being a private 12 plot residential development featuring the uniquely inspired villa style. The highly desirable location of Chaweng Noi is just 1 kilometre away from some of Koh Samui’s best beaches and restaurants.

Stunning new Lux Neo project at Chaweng, Koh Samui | News by The Thaiger

These luxuriously designed spaces include vaulted double height ceilings, mezzanine floors, large open airy spaces, modern terrazzo bathrooms and mezzanine bedrooms – all with breathtaking views of Koh Samui offering unparalleled design with nothing else like it in South East Asia.

Prices start from 8.8 million baht for the 2 bedroom villas ranging up to 12.5 million baht for the 3 bedroom villas.

Read more about the details of this stunning Samui development or make enquiries HERE. You will be able to find out a lot more information as well as compare the new Lux Neo to other projects in the area.

Find out more about Samui HERE.

Stunning new Lux Neo project at Chaweng, Koh Samui | News by The Thaiger

Go to property.thethaiger.com when you want to search for Thailand’s largest selection of properties.

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