Am I allowed to buy land?
Under current Thai law, foreigners cannot purchase land freehold in their personal name, but they can own either through a thai company or leasehold. A number of projects also now provide a more sophisticated hybrid model which combines the best aspects of both ownership methods. This provides an equity share of the land owning freehold company (share of freehold) TOGETHER WITH a guaranteed extendable leasehold contract which provides the option to convert to freehold at any time, either should the law change, or should you wish to set up a company to buy the freehold title for some reason.
A registered lease is easy to setup and there is no restriction on foreign participation. Foreigners are permitted to lease land in Thailand for a maximum of 30 years with an option to renew for a further two periods of 30 years each. A 30 year lease with two renewal options each of 30 years is therefore written.
What happens at lease renewal stage?
After 30 years a new lease is prepared and filed at the Land Office. As part of the sale and purchase agreement the land owning company is contracted to do this. Alternatively, you may convert the title to freehold. When you renew the lease there are no further payments to be made aside from a minimal local tax. The tax equates to approximately 1.5% of the value of the lease.
Can I sell my lease?
You are free to sell your lease or sublet your land to another party. If you build a house you will also be able to rent it out without it being considered a commercial venture. The freehold shares (and house) can of course also be transferred when selling.
What property title am I receiving?
The title of the land must be Chanote or Nor Sor Sam 3 only. Chanote title deed has been issued by the Government using GPS to set the area and boundaries of the land, and is a more accurate accurate method. The word Chanote literally translates as 'land title'. Although there are many types of land title certificates in Thailand, the Chanote title is the best. This title equates to ownership with specific land demarcations, where boundary and size is confirmed and recorded by the Government. Only for Chanote or Nor Sor Sam 3 can be developed and leases can be registered.
My plot is around half a rai, what does that equate to?
Land area in Thailand is commonly referred to by number of rai, in the way that we use number of acres.
A half rai is 800 m2 or 1/5th of an acre. A full rai is 2/5th or 40% of an acre. A half rai site is a good size for a residential building with a pool.
Could someone build and block my view?
Not on any professional project that we sell, where the entire site layout has been designed by surveyors and architects to prevent this. Plots are staggered to ensure that unobstructed views are available, also depending on the shape and gradient of the land there are restrictive covenants in place on building height. This ensures that you will always have plenty of space to build your dream home without compromise. For land sales only, it depends on the particular plot.
Tell me about the infrastructure?
We only sell land with concrete road access, a system for providing water and 3 phase electricity. For the projects that we sell, there is also a professional management company in place to ensure that the infrastructure is maintained and repaired if necessary. A small annual fee will be payable for this valuable service.
What can I do if I buy only land?
The simplest option is to buy and hold a plot of land solely for the capital appreciation. This will provide a strong return on investment (ROI), although will generate no income or 'personal use value'.
How do I Build on my land?
This is easier than you might imagine when you have access to the right designers/contractors and advise.
There are 3 choices.
a) The "Turn-key system", where you choose one of the in-house development designs.
b) We work with our designers and contractors to create your own "bespoke design".
c) You "Self-build" working with your designated designers and contractors. (this option, we can also work as project manager and advise on behalf of you, the client).
Choices in more detaila) Turn-key system
b) Bespoke design
This option allows the client to still have that "turn-key" service, but tailored to allow the client to have a greater say in the overall design and create that bespoke dream villa. As in the "turn-key" method all aspects of the specification and design are determined at pre-contract, but the client will have a much more hands on say in the overall design. We will work with the best Architects that we feel will fulfil your design, specification requirements to create a cost effective, value for money villa.
However, this can be done and has been done as long as you employ the right professionals along the way. There is a trade-off, using the "self-build" method. A cost saving could initially be made, but to get the same level of finish as both the "turn-key" and "bespoke" options, you would employ the best project managers and Architects, who will work solely for you the client. The Net cost saving will be minimal, but you will spending more of your valuable time to get that dream villa.
Can I rent my villa out?
This is a very good way to quickly get back your initial investment and the most common and economical method owning villa in holiday destination. The expected yield is around 9-10% net for short term holiday lets.
We offer a full letting and management service to our clients, which will include marketing and letting the villa, pickup, cleaning and check in and out services. We charge 25% of the rental cost for the full management and letting service. We can also arrange car and/or bike hire and chief service if requested.
What about the property market on Koh Phangan?
Koh Samui's property market has boomed in recent years with developers, ex-pats and investors providing a strong and diverse demand base. The desire to re-focus on real island living has ignited development opportunities on neighbouring Koh Phangan, which has retained its original island charm and natural attractions - a key factor in the early stages of what is becoming a boutique development boom, drawing a more well-heeled crowd. Significantly, there is a strong commitment amongst realtors, local Thais, tourists and investors alike that Koh Phangan will follow a greener path than its neighbour, which is further reinforcing its natural appeal.
Koh Phangan is right at the beginning of the cycle, so from an investment perspective it is a great time to enter the market. It is the micro situation driving this, and fortunately the macro global issues remain a somewhat distant factor on the island. One can clearly see that this is very much the beginning, and we recommend that clients hold for a number of years if they want to realize the ultimate potential. The finite supply of land will combine with the increasing demand as the island steadily grows a name for itself, as factors to drive the market steadily upwards.
However, if prices increase to comparative levels of its neighbour, this will not be because of development, but because it offers something genuinely unique and natural.
Koh Samui international airport is to become the 2nd regional hub for Bangkok air. New international flight routes are to be introduced direct from Shanghai, Bali, Dubai, Kuala Lumpur in addition to the existing direct flight Hong Kong & Singapore. Work has recently begun on an airport in Koh Phangan itself, expected to open in 2014.
We are also seeing a vast improvements to the transport services between Koh Phangan and Koh Samui airport, with the introduction of a new hourly taxi speed boat service that runs between Baan Rak Pier (Koh Samui) and Baan Tai pier (Koh Phangan), which whisks you to the island in under 15 minutes. It is now possible to get from Koh Samui airport to Koh Phangan in under 25 minutes, which less time than it takes to get to many parts of Koh Samui.