Tuesday, 15 September 2015

Living the Dream in Thailand

Despite all the uncertainty about the body politic in Thailand, much of it connected to two men – Thaksin and his Royal Highness – foreigners still continue to flock to Thailand looking to live out their dreams. Thailand is a place where the sun nearly always shines, where there are superb beaches, great dining options and the local culture encourages people to take it easy.

While those looking to escape the rat race may be enticed by the laid back attitude prevalent among Thais they should look a bit deeper into Thai culture. For every success story of a foreigner setting up a bar, resort, villa or shop in Thailand there are a hundred sad stories. The temptation for people in the UK and elsewhere in the developed world is to cash out – to sell the house or business, take out the pension and move to Thailand to spend the rest of their life in the sunshine.

When you look at prices for renting a business in Thailand or buying land it all seems very doable. There are plenty of middle men in Thailand prepared to act as go-betweens to sort out the legal requirements and the visa. There are thousands of potential customers in the form of holiday makers, ex-pats and wealthy Thais from whom a self-sustaining lifestyle can be made. What can go wrong?

 Plenty.

Firstly, the situation with visas is a moveable feast in Thailand. Every change in government or regime in Thailand comes with its own brand of nonsense to publish on the matter. The latest bunch has cracked down hard (supposedly) on English teachers and dive instructors working in the Kingdom on tourist visas. Other administrations have made noises about stopping the loophole of Thai registered businesses with foreign shareholders buying land in Thailand.

 Foreigners have to continually jump through hoops to extend their resident visas for Thailand. Only those working for big corporations don’t have these headaches. Typically you have to leave the country regularly to renew a visa; have to show evidence of funds in Thailand and have to deal with Thai bureaucrats and immigration officers as well as bank staff who all seem to have their own interpretations of the rules. Some of them seem to just hate foreigners.

Further scratching beneath the surface reveals a Thai attitude that can be best summarised as ‘wait and let them leave’. Many Thais will sign a lease for however many years with the expectation that sooner or later the foreigner will run out of money or enthusiasm and they will be left with land or business unit they can lease out again. If on the rare chance the foreigner does succeed there is always the possibility of not renewing a lease and taking over a ready-made successful enterprise.

For example the bars on Haad Rin’s Full Moon Party beach change management every few years as foreigners realise they are not living the dream. The monthly windfall is taken away by the Thai landlord. Moreover the bucket shacks between the bars seem to pick up a good percentage of the punter’s booze cash.

Another example out of millions is the Phanganer clothes shop in Thongsala (see above picture). It is up for rent. The brand is established, the location looks good; the shop is smart and new. However, if you check out the www.waybackmachine.org you will discover the place has been up for lease since August 2013. What looks like a steal has not generated much interest.

Thai Forum is littered with villas for sale for bargain prices. The second hand market for villas is bad. Real estate agents make more money selling new builds and off-plan builds. They skewer the market in their favour.

All of this is not to say that the dream of living and working in Thailand is a lie. Plenty of foreigners marry Thais and carve out their little niche. Some do very well running budget Bangkok hotels and ex-pat bars. Some seem happy in the boondocks farming rubber.

What is certain is that you should never rush in. Do due diligence and then do it again. Don’t forget you could just get a cheap villa rental for a year and not commit the bulk of your savings into a lifestyle project that could go horribly wrong.

3 comments:

  1. Thanks for the well written, informative articles.

    You're quite right to say not to rush in. I have known many clients buy land of upwards of 10m in value yet try to save 50k baht in lawyers fees...needless to say this is very often an expensive mistake. As with everything else it pays to seek advice of someone with experience...not just the guy from the party/pub/local shop lol.

    For professional and knowledgeable real estate services based in Koh Phangan for the last 12 years, www.phanganlandandhome.com can be found to be honest, pragmatic and also affordable.

    Still your articles are a great starting point and full of good info!

    Cheers!

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