Love is not negotiable, but property is

Nobody can deny that most expats in Pattaya are serious persons who decide to settle down in this city. They have liquidated all properties in their countries to buy a new property in Pattaya.

Many people compare Pattaya to a limbo between the devil and deep blue sea. They never care about the “Gross Domestic Product” (GDP) but “Gross Domestic Happiness” (GDH). However, they still have a suspicious mind because of the experience in their countries.  As Shakespeare said “Hell hath no fury more than a woman scorn”, these expats become more prudent for their new conjugal life in Pattaya.

The expat having a Thai couple either spouse or common law wife or civil union partner is not advised to set up a Thai company to buy a real property. These expats expect for the love and happiness. The reason of investment in a real property is to live with their beloveds. Not many expats care about the uncertainty of Thai laws neither a foreign business law nor constitution.

“Love is blind and nobody can negotiate”. However, buying a property from your hard earned money should be the separate issue that you may negotiate. You should not be Romeo who died for his love at the age of seventeenth. All men should be created equal to their conjugal partners.  We use a term “partner” which is inclusive for all genders.

As it is enshrined in the American Declaration of Independence that all men are created equal, these expats should be also equal to their Thai partners for the property matter.

The most popular way to protect these expats is to register a 30-year lease agreement for the land and house they bought for their Thai partners. The leasehold right is different from the ownership or freehold right. However, if you register the 30-year lease with the Land Office, your right to stay in that land and house will not be disturbed by your partner or any third party. Nobody can kick you out of your land and house. How about the option to renew the lease for another 30-year period” This option cannot be used against a third party. You will have to calculate if the 30-year period is enough for you.

The disadvantage of using the 30-year lease is that your partner becomes the owner of the land and you are only the lessee. If your partner dies before you, the ownership of the land and house will be conveyed or transferred to his/her heirs. Even you can still live in that land and house but you will not be happy with the new owner. In the worst case scenario, your partner may sell the land and house to a third party. You can solve this problem by asking your partner to have a last will and testament (Pinaikam) to appoint you as a legatee to bequeath or transfer the land and house to you after the death of your partner. There are many controversial issues that the real heirs can come to challenge once you probate the will in court.

The Land Code of Thailand imposes restriction on a foreigner to the ownership of land. The land literally means only a geographical part not a house or building structure. However, the foreigner can inherit the land from his spouse. But spouse under the Land Code means only the marriage between male and female not the same sex marriage or civil union in other countries because Thai laws have not yet recognized the same sex marriage. This is the gender injustice that should be abolished from Thailand which means the land of freedom. If you can negotiate with your partner for the above protection, you will find the real happiness which is free from any dilemma. Everything is impermanent including love.

This advice is appropriate only for expats dealing with conjugal partner not business partner or friend. For the different scenario, there are other alternatives to protect your right by either registering a mortgage or setting up a company.

You may discuss with your lawyer to find out the most appropriate way to make you happy.

In Pattaya, you have to maintain the equilibrium between “Love” and “Property” by just saying “as good as it gets”

The Convenient Truth about Property Buyers in Pattaya

The property market in Pattaya increasingly becomes a bread and butter not only for many expatriates in Pattaya but also Thais in other parts of the country. People are more interrelated. You may have the best Thai food and football team in Manchester city.

Most expatriate property buyers in Pattaya have a nightmare that Thai laws can be changed overnight and they may lose everything they own. Nobody can comprehensively explain the plethora of laws and regulations besetting all property buyers. However, the enforcement of laws is always tolerant. If the government blindly enforces the laws without studying of the impact, it will definitely create a snow ball effect which is beyond our expectation.

The expression “The exception proves the rule” makes us to understand that we will have to see the exception of the law in order to make a judgment if that law is good. There is the good news that the interim government has already withdrawn the controversial draft amendment of the foreign business act. How about the expatriate property buyers in Pattaya” If they set up a company to buy a piece land with the area not more than one rai for the residential purpose, they can still enjoy the tolerance of the laws. No law can be retroactive and detrimental to their rights.

Low Profile but High Profit

To set up a simple company to own a piece of land with the area not more than one rai is still a preferable solution for many low profile expatriates coming to Pattaya for retirement. These expatriates will not be involved in any conspiracy theory like expatriates in other expensive resorts in the south. In Koh Samui, some expatriates set up 300 companies to buy property. What lies beneath”

If you are not involved in any illegal business, e.g., money laundering, you should set up only a simple company with a clear shareholding structure not involved with other offshore jurisdictions, e.g., British Virgin Islands or BVI.

The business activity of this company should not be involved with real estate business in order that the company will not be liable for real estate taxes. The financial statements or balance sheet must be prepared at the end of the year with the English translation in order that you can understand all tax implications.

The most important issue is about the Thai shareholders who will hold 51% of shares. You should know all of them quite well in order that you will not be implicated with any conspiracy they may commit.

For expatriate property buyers who have a reliable Thai partner or spouse not based on the casual relationship, the ownership structure of land can be alternatively by a 30-year lease agreement with a Thai partner. They can also arrange for a partnership agreement to share 50% with the Thai partner in case of separation.

The other tough measure is to arrange for a loan that the Thai partner borrows money from you to buy land. The Thai partner will register a mortgage of that land to you with the land office. The disadvantage of this measure is that your Thai partner will not be happy because you will have the absolute power on that land. Your Thai partner will not be able to do anything with the land without your consent. No transaction should be dealt through your Thai partner.

Whatever ownership structure you will use, you should deal with a developer or owner of the land by yourself by signing a contract and make direct payment to the owner. You may have your own lawyer or Tanai Kwam to assist you without any conflicts of interest. In Pattaya, there are many unlicensed persons professing themselves to be a lawyer or Tanai Kwam. They always call themselves “Legal Advisor”. You just ask a person dealing with you to confirm if he or she is a “Tanai Kwam” and show you a lawyer license issued by the Lawyers Council of Thailand.

It is advisable to weight between the pros and cons of the above measures in order that your aim of being happy in Pattaya will not be disturbed by your suspicious mind. For more knowledge about Thai property laws, you may visit our reading room

“Just keep yourself low profile with the high profit of happiness”