Buying Off Plan Property in Thailand - the Advantages and the Disadvantages

Advantages

1) The main advantage of buying an off plan property in Thailand is the price. Off plan properties are nearly always cheaper than a comparative built property. Off plan in Spain and other countries around the world are investment opportunities. The same is true in Thailand. The earlier you invest in a development the bigger the potential profit is. As the development progresses so the prices for remaining off plan properties also increase.

2) If you invest with a developer with a proven track record your investment is usually safe.

3) It is sometimes possible to sell on your off plan before construction has finished. Thus making a quick profit.

4) Once the property is built you have a brand new house or villa. This villa because it is new will usually come with a structural warranty. Second hand houses and villas rarely come with a structural warranty.

5) Your new villa has had no previous owners so you won’t have to pay for alterations. Furthermore, most developers allow customers who purchase off plan property to customize their villa in terms of interior design, tile colors etc. This means you can really get the villa of your dreams with off plan.

Disadvantages

1) The main worry for the purchaser of an off plan property is that the constructor and/or developer will go bankrupt before your off plan property is completed. In which case you will have to apply to the Thai courts for compensation.

2) Time can be a negative factor. Often things take longer to build than expected in Thailand. It can be frustrating making plans to stay in your new villa only to discover that it isn’t ready for occupancy yet.

3) In the current economic climate the housing market has seen a considerable slow down. This means that off plan investment is unlikely to result in a quick purchase and re-sale to make a tidy short term profit. In the longer term property prices will increase and so will demand in Thailand. This means off plan property is more suitable for those able to wait a few years to make a profit on their investment.

4) You cannot see the property before you commit to buying. You have to make your decision based on computer renditions of the off plan property or from viewing a show house. It is the technical competency of the constructor, the reputation of the developer and the real estate agent that you have to place faith in. This is faith that the villa will be completed to set out specifications. It is important to get an independent building inspector to visit the property as it is being built to make sure the building plans are being followed.

These are the major issues of buying off plan in Thailand. It is always advisable to do your homework before committing to an off plan project. Remember that in Thailand real estate agents and developers are often one and the same thing, so don’t expect independent advice from the real estate agent. If you are keen to buy off plan property in Thailand always check around and compare the prices with finished houses on the market. If there is no considerable saving in buying an off plan property then it is not a good investment. And finally, it can never be stressed enough, get a good lawyer to advise you about the issue of foreign ownership in Thailand; and get a lawyer to check with the land registry office who actually owns the land you are intending on purchasing or leasing.