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Dozer Buying Land

image dsc20330.jpgIt’s been an exciting week. The big accomplishment of the week is the final chapter in the purchase of a small plot of land directly behind the cool thai house prototype. The house (read about it at the coolthaihouse here) currently sits on 84 square wah of land and after getting fully moved in, the notion crossed my mind that I might be here a while. While the house is pretty much perfect, there really is a lack of space to store all of the gear. I’ve temporarily got a whole shed full of wood and other building materials, and in the house there is a little clutter involving mud sucking water pumps, hand tools and other miscellaneous junk. That led me to think about how sweet it would be if I could just get a little bit of land directly behind this parcel. I could build a nice outbuilding where I could park the truck, store stuff and possibly build a water tower.

About 4 months ago the wife and I got together with an older Thai gentleman, ‘uncle Sak’, who owns several rai in this village. He had recently (within the last 5 years) taken three rai of land and subdivided it — and given 1 rai each to his 3 children. This particular land I was interested in was at the back of a one rai chunk which was his youngest daughters. By the time we met with Sak and his wife at their business (an eatery), they had discussed the sale already with their daughter, who was interested in selling. They were stuck on a figure of 250,000 for a parcel of 1 gnan (which is 100 sq wah or 400 sq meters) and didn’t seem to want to budge off that price. I figured the land was only worth, at most 200,000, but it is a bit of a unique situation. The bargaining advantage is in their court since we approached them. After talking for a while and not really having anyone budging — I suggested this. Let’s go with the price of 200,000, but I’ll pay all expenses associated with subdividing the land and all of the transfer taxes. It is normally customary for the seller to pay the transfer taxes, but it is a good negotiating tool since I figured the sub-division and transfer costs wouldn’t run more than about 10,000 bhat. They wanted to take the deal and it gave them a face saving method to do it, since no-one really knows how much expense is involved in doing the transfer. In any event, the deal was finally struck, and we shook on it.

image dsc20369.jpgThe first step in the process is to go to the land office and pay for the parcel to be ‘split’. The surveyors will then come out in normal or ‘expedited’ mode. Since we weren’t in a particular hurry we went with the normal mode. I don’t know how much you’d need to pad someone’s wallet to go expedited, but I would figure about 2,000 baht note might do it. In any event, the official fees in this case were just over 3,000 baht. The wait time was just over a month. Then a survey team came out and surveyed the land and placed the border markers at the four corners of the parcel.

The owner, Siapim (‘uncle’ Sak’s daughter) then went to the land office to request a new deed for the split parcel. This is another slow train – it ended up taking a couple of months and a few different trips to the land office. During this wait a deposit was requested – which I paid and received a receipt. Then about two weeks prior to the actual transfer I went off to the lawyers to get everything in order.

The lawyers would need to do a couple of things to aid the sale. * Update the date on the company guarantee book (nangsuu rap rong). This is done at the court. The date needs to be within the past 6 months (verifying the company is current). * Minutes of a corporate meeting authorizing and stating the purpose for the land. This is required by the land office.
* A purchase agreement. This goes to the accountant. * One other thing worth noting here. If you are buying via the Pattaya land office and using a company, you need to check that foreign ownership is 39% or less. This percentage varies from land office to land office. In addition the lawyer will check out the deed and make sure everything is up to snuff. The main lawyer was out of town, so we ended up dealing with the staff who are basically paralegals.

image dsc20347m.jpgOn the day of the transfer (last Friday) I went over to the lawyer’s office early in the morning. They still hadn’t completed what they had promised me would be done for sure by Friday morning, but they promised (again) that if I came back in about an hour everything would be all set. So, I went off to make a bank withdrawal and then picked up the wife and the property seller. Off we all went to the lawyers, of course nothing that should have been done was done yet. Waited around, while they did the corporate meeting minutes. It stated, incorrectly, that there was a dwelling on the property along with some other mistakes. Then they corrected it, the second time around it was still wrong. I mean this is the most basic of transactions, the service was just not up to snuff on this go round.

image dsc20351.jpgFinally, we got off to the land office (the three of us) about noon. Normally we have a ‘friend’ in the land office which mitigates the need for waiting in the queue, but on this particular trip it was no good. The wife says it was because we didn’t get there first thing in the morning. In any event, we got a queue number of 51 while the current number was about 33. Even with only 18 to go it still took about 3 or more hours to get called.

The first person looks over the deed. He wanted to know why there was no road shown on the deed. It is a good thing to note; the deed normally should show road access – it is a protection that you will indeed be able to get to your land. In this case it wasn’t necessary to have road access since it was an adjoining piece of land. He then assessed taxes based on the amount shown in the corporate minutes. This amount normally isn’t normally the same as the actual amount but is some ‘believable figure’ (which is stated in the corporate minutes). In this case there was a penalty assessed since the land had been transferred within the previous 5 years (business transfer tax) which amounted to 3% of the stated amount. The regular transfer tax was just over 2% of the stated amount. Then there is a transfer fee which in this case was 1.5%.

image dsc20370m.jpgAt about 5:00 PM the deed finally came back. On the back of the deed is a transfer ledger showing the transfer (ie. the front of the deed will always show the original owner). Success. Off to the lawyer to get the purchase agreement. Still not complete, will need to go back on Monday to get it. This lawyer’s office is off my recommended list and I’m looking for a new one in the future.

Then back to the house where we met with Uncle Sak and paid the remaining amount due on the land in cash.

Things worth noting about buying and selling land in Pattaya. * The land office here isn’t the model of efficiency, but it isn’t plagued by problems of phony land deeds as in Phuket. * If you’re going to transfer at the land office you should get there a few minutes before it opens at 8:30 AM, so you don’t blow the whole day. * You can do a land transfer yourself, but lawyers are good for helping get all the paperwork right and checking things out. I would always advise using one when property is changing hands.

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