My Bangkok lawyer has constantly been in contact with me, advising me to wait. My developer now needs a decision as he has another foreigner interested in my plot who will lease. Are people still actually buying in Hua Hin, what is the state of the developments does anyone know? Is construction still going ahead.
Yesterday I received this from my lawyer.
You will see that the regulation will be applicable since 15 August 2006. If your company is setup in this period, the regulation will be applicable to your company as well.
The point is if a limited company is set up by using you (a foreigner) as a a director, the company and other shareholders will be examined and requested for their financial statements no matter how percent of shares held by you. Or if you will not be a director in the company, you are able to hold only not over 40% of shares. If you still would like to be a director of your own company, the best solution for you is to hold 35% of shares and provide other Thai shareholders by yourself.
However, if it is possible, I would like to recommend that you wait for a while to see how much the officer will strictly take action with this regulation. Because, after having given some questions to the officers so many times, we never received any cleared answers from them. Also this is just an initial period of issuance of the regulation, we would like to see some study cases regarding this new regulation first.
Anyway, I remember that you used to refuse leasing option in accordance with my recommendation for 2 times but after having discussed with my senior lawyer regarding your case, we're pleased to recommend that you reconsider the leasing option for your decision. If you choose the leasing option, we will describe in Lease Agreement that whenever it has some changes issued by the Department of Business Development leading to your right of purchase, the developer agrees that you will be able to purchase the land immediately. Or we may specify in the Lease Agreement that if you have someone you are ready and intend to transfer the ownership to, the developer will complete the transfer to the transferee for you with your own expenses.
ADVICE FROM LAWYER ON COMPANY SET UP
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karenjuice
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Karen,
Maye the government are trying to steer everyone to the leasing option, another thread mentioned about pre paid renewals saying that this was legal, take a look at this option, maybe also look at a lease which offers a renewalto 30 years every 5 years.
Hope it works out ok for you.
By the way - yes peopel are buying and yes construction is goinf on as normal.
Maye the government are trying to steer everyone to the leasing option, another thread mentioned about pre paid renewals saying that this was legal, take a look at this option, maybe also look at a lease which offers a renewalto 30 years every 5 years.
Hope it works out ok for you.
By the way - yes peopel are buying and yes construction is goinf on as normal.
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silverbird
- Member
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- Joined: Tue Jun 06, 2006 10:06 am
Have seen your name on other posts so I take for granted you have all information posted here about various types of ownerships. It is a chilly market for sure. There are projects without any real work going on and it is "slowing down". But it is no way a dead market and can in now way be compared to the crash here almost ten years ago.
Spoke to one developer this morning. He has one contractor who can not pay his labour their wages at the moment due to lack of cash. The reason is he is not getting paid by other customers (developers). So my friend has to pay the labour directly as they otherwise go back to where they live – far away from here. The market is now feeling the negative effects of what started May 25th (the date information came out regarding a letter written May 15th). I expect it to recover but not in the near future.
Lack of new customers means lack of cash flow to the developers. The real loosers might very well be those who bought houses the last few years and still have got not even a Title of Deed. Many of those have paid a lot in advance and the houses are still under construction!
Leasing is very good for the first 30 years. It has been used by some developers for some years now. If it would be possible to get more than 30 years registered at the Land Office this would be great – but it is just impossible!
You wrote your developer has another foreigner interested in “your plotâ€
Spoke to one developer this morning. He has one contractor who can not pay his labour their wages at the moment due to lack of cash. The reason is he is not getting paid by other customers (developers). So my friend has to pay the labour directly as they otherwise go back to where they live – far away from here. The market is now feeling the negative effects of what started May 25th (the date information came out regarding a letter written May 15th). I expect it to recover but not in the near future.
Lack of new customers means lack of cash flow to the developers. The real loosers might very well be those who bought houses the last few years and still have got not even a Title of Deed. Many of those have paid a lot in advance and the houses are still under construction!
Leasing is very good for the first 30 years. It has been used by some developers for some years now. If it would be possible to get more than 30 years registered at the Land Office this would be great – but it is just impossible!
You wrote your developer has another foreigner interested in “your plotâ€
Last edited by silverbird on Thu Aug 10, 2006 4:45 pm, edited 1 time in total.
karenjuice,
Whether you decide to go for lease or purchase through a company is a decision for you and what you are confortable with.
IF you decide the company option, you should know the way it works is if you have a 1M Baht company, the Thai shareholders must hold 51% of the shares, that is 510,000 Baht's worth, at 85,000 Baht per 6 shareholders.
Your solicitor should be using shareholders such as proffesional people, other solicitors etc, and should be making copies of their bank books to show they have at least 85,000 Baht. If he can not do this he is not using the right shareholders.
Personally I would be concerned when he says:
I would like to recommend that you wait for a while to see how much the officer will strictly take action with this regulation
as he appears to infer that if they do not enforce it then he can use shareholders who can not prove the 85,000 Baht. This may get checked at a later date and be a problem to you. If your company is already set up using shareholders who can not prove their funds, then ask him to change them for one's who can, it's his job to set you up correctly.
IF he had the correct Thai shareholders from day one, he would not have to wait to see if they 'enforce' this regulation or not. You should be complying with it, not waiting for it to be relaxed.
Burger
Whether you decide to go for lease or purchase through a company is a decision for you and what you are confortable with.
IF you decide the company option, you should know the way it works is if you have a 1M Baht company, the Thai shareholders must hold 51% of the shares, that is 510,000 Baht's worth, at 85,000 Baht per 6 shareholders.
Your solicitor should be using shareholders such as proffesional people, other solicitors etc, and should be making copies of their bank books to show they have at least 85,000 Baht. If he can not do this he is not using the right shareholders.
Personally I would be concerned when he says:
I would like to recommend that you wait for a while to see how much the officer will strictly take action with this regulation
as he appears to infer that if they do not enforce it then he can use shareholders who can not prove the 85,000 Baht. This may get checked at a later date and be a problem to you. If your company is already set up using shareholders who can not prove their funds, then ask him to change them for one's who can, it's his job to set you up correctly.
IF he had the correct Thai shareholders from day one, he would not have to wait to see if they 'enforce' this regulation or not. You should be complying with it, not waiting for it to be relaxed.
Burger
Last edited by Burger on Thu Aug 10, 2006 4:47 pm, edited 3 times in total.
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karenjuice
- Rookie
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- Joined: Mon Mar 20, 2006 4:09 pm
- Location: spain
Thanks for your comments JW and Silverbird. Its just so difficult to make the decision one way or the other. We have bought from a developer we are very happy with, they have built many other developments in Bangkok so we know they are not short of money. They have given us all this time and have provided us with many options without trying to push us but obviously a decision has to be made soon. They even told us they would put into the contract a clause whereby they would reimburse our money if we were not able to transfer successfully at completion. They have sent us photos a few weeks ago of our property being built and they have built many other houses in this short time so obviously they are not just after our money. I´m not worried about the development being completed, just this leasing option. Somebody sent me a PM and she is over there at the moment and is going to check on our development so I will get an update after the 21st. Do you think that agents, developers and lawyers are maybe omitting to tell the new buyers about the company option and just telling them about the lease options and this is why people are still buying?
My developer now needs a decision as he has another foreigner interested in my plot who will lease.
This sales technique is very high pressure and heavy handed. Take them up on their threat. This is your chance to bow out gracefully, have your deposit returned and allow some one else to purchase this property.
There will be lots of other chances to be involved in the property market in the future and possibly at a lower price.
This sales technique is very high pressure and heavy handed. Take them up on their threat. This is your chance to bow out gracefully, have your deposit returned and allow some one else to purchase this property.
There will be lots of other chances to be involved in the property market in the future and possibly at a lower price.