The situation with The Baht, and the USA will change from what it is. There is going to be glut in properties for sale in Thailand as the AIG sting comes to bear so for those who have money to spend youre on a winner. .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 with right to renewal to a freehold purchase, or a Thai company (7 PARTNERS) can be established with Thai majority shareholders. Foreigners only own 49% shares in a company with individual ownership of the foreigner holding land based on 39% ownership. We can assist you to make sure your company is safeguarded. Remember if you need advice ask us.
THAILAND PROPERTY SPECULATION, REALTORS & THE SUB PRIME CRISES how it started in USA
Most home-buyers would be lost without a well-qualified realtor, estate agent, property agent who sell houses although in Thailand with no regulations the Thai girlfriend is normally the key. Many if not most realtors are so zealous to get potential home-buyers into homes and earn their commission that they are more concerned about closing the deal than making sure their customers can afford the payments down the line or that theres no zoning so watch out. In today's current mortgage foreclosure crisis, there's a sobering lesson for anyone involved in the home ownership business.
It isn't just about getting a buyer into a home - it's also about making sure that that buyer has access to credit lines that isn't going to result in a foreclosure, should the buyer hit one rough bump in the road as well as the regulations. Banks have predicted that roughly 6.5 million homes will go into foreclosure in the next five years. Hey but that’s not even in Thailand so as a foreigner youre safe as you have paid cash --- now you can thank the Thai Govt for keeping a hold of their land and allowing you freedom from creditors because you never borrowed to buy---lucky you.
In Thailand fortunately one must lease for 30 years and cannot buy outright (unless via a Thai Company )and for many this is OK. This no own land rule is excellent as it prevents foreign speculation which has bitten into the western world and caused chaos. Thailand has zero zoning so whose to say Nok the neighbor doesn’t start up a 24 hour factory or a plastic bag disposal business?? next door. Does the Sales rep tell the would be buyer this? Of course not as it will never happen!
In Thailand it’s the foreign realty companies who hit the main seaboard centres of Pattaya and Phuket, Samui who jack these prices up. But they are not alone as everywhere Thai companies and partnerships swamp seaboard resorts and build guesthouses and condos some of which are a complete eyesore. But, what we have seen in the west could have well been here also long ago if the Thai Govt never maintained their hold on property ownership. In the USA greed took hold of property owners who over borrowed thanks to finance companies having no basic ethics & sending the owners into receiverships although a lot was greed and keeping up with the Jonses which is a US norm.
But have a look and then see the amount of foreign owned realtors as against the number of 7/11s in Pattaya. It normally starts like this. A foreigner decides to start a business and sees real estate as an ideal potential business and away he goes. He knows about buying bars, massage parlours, beauty & travel shops as that’s work & no dolleros & besides theres too many. The idea is sell a few properties, get funds together then start building or buying your own condos or properties. Of course the properties are geared towards would be other foreign buyers so they dress these properties up to Euro specs at a nice profit margin of course. The next step is to now buy land and build an estate of homes under the Thai Company guise & again for those retirees coming to Thailand or even condo buildings. But this time they are more lavish again geared to Euro standards. Pre sell them is the norm to cover your low building costs & lock the buyers in on lavish sales pitches and advertising. Some companies even guarantee rental incomes??? amazing--- guarantee?? The profits are now even better but what they are doing is inflating the housing industry as well. With house property values increasing 10 fold it sets the wheels into motion & of course the average Thai is now not in the ball game unless he has Euros or US$ to spare. Remember these houses are geared at the incoming European buyers, not the locals and the areas they are built on are turned into hopefully trendy suburbs or that’s what they try to do. This increases the values even more and the Thai developers are also in amongst the throng but many of their developments are substandard unless they are recognized building companies. Fortunately the Thai Govt has not allowed foreigners to buy land and houses in ones name and good thinking but theres loopholes where individual companies can start a business then use the properties incorporated into the company. If they did allow complete ownership then Thailand would not be the nice place it is as foreigners would speculate even more and the Thai people would suffer.
Now see the subprime situation in the USA & perhaps you could relate it back to Thailand somehow. Its easy to see. Your house is worth $80,000 today. Within 1 year it is now worth $160,000 or so you think wow!!. But within 2 years it is worth an amazing $240,000. So its boom time and you are rock and rolling with zeal. You then feel its time to buy another house or maybe why not 2 houses. The banks will lend you 80- 100% mortgage with super easy credit lines no worries so you get your second or 3rd property as you now know you are on a roll. Your properties are your ATM card to print you money so to celebrate your new acquisitions you buy mum a new car as well & redo the house up. Of course in your mind you are thinking the house properties will keep going up and on paper you are worth triple what you were 2 years ago so whose to worry. How can you lose? All your neighbours follow suit cause you have to spread the word. The Banks, finance companies want to lend you even more as they have no central bank to tell them otherwise & because you’ve got the collateral in your own properties and youre an instant millionaire. Your friends see the angle and away they go too. Who cares its so easy, its crazy and its money for grabs.
But then sadly the credit crunch hits with a bang. You cannot meet payments, your tenants leave as the rents are too high & the creditors come knocking on your door as they can't service their paybacks. Banks change their lending rules overnight & you portfolio now looks a mess. Your cars get repossessed & you realize you have over worked your ATM card on overtime. Your wife must now go back to work or she leaves you & you need to sell quickly to meet the next payment. Within 2 months your properties have slid backwards and youre faced with foreclosure. This is reality & this is what has happened. Some say its greed not waking up to reality but only those who are affected will say otherwise.
In 2008 in USA more than 600,000 jobs have already been lost this year, according to the government. And there are currently over 9.4 million people looking for work in the U.S.Since May, General Motors (GM, Fortune 500) laid off 19,000 hourly workers, Starbucks (SBUX, Fortune 500) cut 12,000 jobs and American Airlines (AMR, Fortune 500) announced it was cutting 7,000 jobs, according to Challenger, Gray & Christmas. Banks continue to hoard cash in the wake of last Monday's collapse of Lehman Brothers and last Tuesday's near implosion of AIG (AIG, Fortune 500).
Oct 1st 2008: US President George W Bush has warned the US economy is at a "critical moment", and vowed to get his Wall Street rescue plan through Congress??? but its been rejected & if you listen to Bush when he first made speeches using the word um in every line---- would you have faith in this uneducated leader or better still have his sidekick one man Henry Paulson, the U.S. treasury secretary running all this money. Bush said the consequences would be "painful and lasting" if the $700bn (£380bn) deal rejected by the US House of Representatives was not passed. He offered reassurances to citizens of the US and wider world that the current political deadlock would be resolved.
Ordinary voters writing or emailing their own members of Congress angrily demanding that they reject a scheme which is universally perceived here as a bail-out of Wall Street bankers. They are perceived as greedy, incompetent fat cats who have created this crisis themselves and who are now being allowed to pick the pockets of American voters to fix it.
Source BBC news
collapse of Washington Mutual (WM, Fortune 500) and Wachovia Bank (WB, Fortune 500) in the past week.