Eviction threat for Australians puts life savings at risk

[lonelywombat]

Eviction threat for Australians who put life savings into Thai dream homes
Date November 26, 2014 - 2:44PM

http://www.smh.com.au/world/eviction-th ... 1u7a1.html (http://www.smh.com.au/world/eviction-threat-for-australians-who-put-life-savings-into-thai-dream-homes-20141126-11u7a1.html)

Melbourne retiree Daryl Davies outside the Chom Tawan residential development on Phuket's west coast. He and other buyers face eviction.
Daryl Davies knew when he saw the luxurious homes set amid eight tropical acres with stunning sea views that this is where he wanted to spend his retirement years.

"They are absolutely delightful," says 70-year-old Mr Davies from Melbourne, referring to a $30 million development on the pristine west coast of the Thai resort island of Phuket.

Mr Davies, a retired commercial pilot, paid the equivalent of about $500,000 in Thai baht for his dream three-bedroom home in Chom Tawan, one of the most prestigious residential developments on Phuket.


But a Thai court has authorised an auction of the homes of Mr Davies and more than 40 other buyers to the highest bidder if millions of dollars owed to the Industrial and Commercial Bank of China (ICBC) by the project developer are not repaid by a December 17 deadline.

The plight of the buyers, many of whom have been living in the homes since they were completed seven years ago, illustrates the risks foreigners face buying real estate in Thailand, one of the most popular destinations for retiring Australians.

Mr Davies and other buyers, including five Australian families, believed they were covering all bases before paying for what were promised to be effectively 90-year leasehold titles for the homes, including hiring lawyers to do due diligence on the property.

Napawan Asia Limited, the developer of the Chom Tawan residential estate, owes millions to the Industrial Commercial Bank of China.

"We never for one moment thought there would be a problem," says Mr Davies, who is married to a Thai.

Two years ago buyers awoke to find notices pinned to their doors declaring that a Thai manufacturer had not been paid for supplying appliances to the development.

"We were shocked. We started investigating what had happened but it only got worse, much worse," Mr Davies told Fairfax Media.

The developer, Napawan Asia Limited, had promised that buyers who paid upfront for their houses would receive titles reflecting their freehold/leasehold ownership once the development was registered with Phuket's land department.

"The company kept telling us everything is going nicely. It's happening, don't worry. But it went on and on," Mr Davies said.

Catherine Gathani, a buyer from Hong Kong, said she was aware when finalising the contract for her home there was a mortgage on the land but Napawan Asia told her "this would be paid down as the buyers' stage payments were made, so that by the time the project was complete the mortgage would be fully paid".

She said buyers only discovered several years later the company had not repaid the original mortgage and that it had given the titles of the buildings to the bank as part of a debt restructuring or remortgaging arrangement.

Andrew Street, the British developer behind Napawan Asia, admits the company was "over-extended commercially at the commencement of the global financial crisis", which he says had a significant impact on Phuket.

Mr Street, who has returned to live in Britain, told Fairfax Media "I have remained and still intend to deliver all that the buyers require".

"Within weeks of this date there will be firm plans to bring this debt restructuring to a conclusion," he said. "All parties are involved in producing an agreement to achieve the buyers' requirements relating to ownership . . . we are at the final negotiations of all matters with the bank, buyers and suppliers to conclude this matter."

But Mr Davies said attempts over recent months for a settlement between ICBC, the buyers and Napawan Asia have collapsed in acrimony.

Under one proposal discussed by ICBC in October, the buyers would be forced to pay almost $200,000 more than their original purchase price in exchange for the bank releasing the mortgage.

The development builder is also owed several million dollars, complicating any settlement.

Mr Davies described the proposal as a "bridge too far" for the buyers.

"Many of the investors are retirees who face losing most or all of their life's savings. It is an appalling situation to be in," he said. "We fear that one day soon we will all gets knocks our doors and be told to leave our homes."

Mr Street, who bought a $1 million house in the English Midlands in August 2013 after leaving Phuket, said "certain people" have tried to personalise the issue and derail any settlement amid a myriad of legal claims and counter-claims.

"It is not in the interest of all parties concerned for me to return to Thailand whilst in the final steps of the debt workout," he said.

As the auction deadline nears, buyers desperate to keep their houses have asked Thailand's military rulers to intervene in the case and have taken urgent legal action to try to head off the sale of their houses.

Mr Davies said the buyers he is speaking for have not given up hope of keeping their homes "but our position looks dire".

He said the buyers decided to speak publicly about their plight to warn others who may be considering investing in Thai real estate.

[Smiles]

Shades of the Ocean 1 project in Jomtien. Still just a vacant lot ... hardly changed in years. I assume the naive 'investors' who plunked down loads of dough before a shovel-full of dirt was lifted have lost what they paid.
Meanwhile the charming Mr Street ~ a Brit, not a Thai ~ luxuriates somewhere in the Lake Country. Did you invest Mr Lonely?

This scam scenario plays out often in Thailand, Florida and Basingstoke.

[lego]

Fools and their money... Here and there, same same.

[goji]

Fools and their money.

Presumably just that.
You would think that by the time most people acquire enough money to be thinking about a retirement home, they might just have acquired sufficient worldly wisdom to employ a reputable lawyer, ensure they have title to the properties and ask the question "what happens if the developer goes bust or runs off?"

You would think that by the time most people acquire enough money to be thinking about a retirement home, they might just have acquired sufficient worldly wisdom to employ a reputable lawyer, ensure they have title to the properties and ask the question "what happens if the developer goes bust or runs off?"Where's the evidence that that is indeed the case? I'd have thought there is no evidence to support this bizarre assertion. I'd be basing my decisions on "Thais are a bunch of rogues and con-men, and the rule of law doesn't, in practice, exist" concepts - but then I am not now nor ever have been "most people".

[lonelywombat]

Melbourne retiree Daryl Davies outside the Chom Tawan residential development on Phuket's west coast. He and other buyers face eviction.


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[latintopxxx]

dumb asses...sinking all their cash into a develolment in a country with a known weak judicial system...a system that is based in favour of the entrenched powerful.

[witchhunt]

Eviction threat for Australians who put life savings into Thai dream homes

"They are absolutely delightful," says 70-year-old Mr Davies from Melbourne, referring to a $30 million development on the pristine west coast of the Thai resort island of Phuket.
Mr Davies, a retired commercial pilot, paid the equivalent of about $500,000 in Thai baht for his dream three-bedroom home in Chom Tawan, one of the most prestigious residential developments on Phuket.
.
Sometimes when I read certain peoples responses I wonder if they read the original link or just type to get their names up again in lights.
The photos which quote $500,000 but paid in Thai baht, did not give the local cost At the current exchange very loosely of 30 baht, then the purchase cost would have been 7,500,000 Thai Baht
Smiles comment about the Ocean 1 project which was never started, has nothing to do with this completed house many years after it was completed.
Those who have bought houses or condos in Thailand, would have a shiver go down their backs as they wonder could this happen to us.I have never been keen on Phuket but the places look wonderful.

[Dalewood]

1. How much does it cost to rent a deluxe two-bedroom waterfront condo in Phuket? Why buy?

2. The flip side of the above: $500K seems to be enough to buy a nice waterfront place in a warm part of Australia---unless you must have a view of the Sydney Opera House. Why take the risk? (These people strike me as married couples).

[goji]

1. How much does it cost to rent a deluxe two-bedroom waterfront condo in Phuket? Why buy?

Many westerners look very favourably upon property as an investment. Partially as a lot of people have made a lot of money on it in the past.
As a result, they tend to overlook the downside risk from buying property.

I see big problems with buying property in Thailand. We're not allowed to own the land & the judiciary doesn't exactly have a reputation for being fair.
So renting looks like by far the better option.

1. How much does it cost to rent a deluxe two-bedroom waterfront condo in Phuket? Why buy?Many westerners look very favourably upon property as an investment. Partially as a lot of people have made a lot of money on it in the past. As a result, they tend to overlook the downside risk from buying property.

I see big problems with buying property in Thailand. We're not allowed to own the land & the judiciary doesn't exactly have a reputation for being fair. So renting looks like by far the better option.
You fail to mention (1) the lack of enforceable building standards; (2) the lack of enforceable building maintenance levies in condo buildings where non-Thais can have freehold title and (3) if there's a fire you will have to pay the emergency services to attend and then look on helplessly as they loot and pillage your property before declaring the building safe so you can re-enter (although that's also true for renters). Welcome to Thailand.

Still waiting for you to provide the evidence for your previous assertion:
You would think that by the time most people acquire enough money to be thinking about a retirement home, they might just have acquired sufficient worldly wisdom to employ a reputable lawyer, ensure they have title to the properties and ask the question "what happens if the developer goes bust or runs off?"

[Impulse]

This should not be blamed on tit. The buyers trusted the Brit developer, that was their mistake. They knew the land was still owned by the bank but they believed that it would be paid off as more property was sold by the developer. The land was never paid off so the bank can reposes unless they come to an agreement, which looks like they cannot.

The only thing you can own in Thailand is a condo if you fall into the 49% half. Only buy from developers with a track record and have a lawyer who knows what he's doing. They have almost finished topping off the off plan unit I bought a couple years ago, I'm not worried at all, but I haven't plunked down 500 k( which is about 15 million baht btw).

I feel sorry for these people for wanting their dream home so badly that they let an unscrupulous developer who owns a million dollar house himself, talk themselves into this mess.

This should not be blamed on tit. The buyers trusted the Brit developer, that was their mistake. They knew the land was still owned by the bank but they believed that it would be paid off as more property was sold by the developer. The land was never paid off so the bank can reposes unless they come to an agreement, which looks like they cannot.Absolutely rocket, not a TIT situation at all. The British scammer didn't know that he could get away with his trickery because of Thailand's lack of a decent legal framework; he just got lucky.

[Nirish guy]

Mr Davies and other buyers, including five Australian families, believed they were covering all bases before paying for what were promised to be effectively 90-year leasehold titles for the homes, including hiring lawyers to do due diligence on the property.

Is there not such thing as the Law Society in Thailand where if a lawyer has been negligent in their duties ( i.e. finding the outstanding mortgage on the land, which lets face it should have been a day one search) that they then are liable to a counter claim about that and or are also then covered by their own neglience insurance to cover such instances ?

[goji]

Still waiting for you to provide the evidence for your previous assertion:
You would think that by the time most people acquire enough money to be thinking about a retirement home, they might just have acquired sufficient worldly wisdom to employ a reputable lawyer, ensure they have title to the properties and ask the question "what happens if the developer goes bust or runs off?"

Try reading & comprehending what I wrote first.

Try reading & comprehending what I wrote first.What I was expecting you to say was something like "I am an incredibly naive and stupid person with no understanding of human nature nor any knowledge of financial scams, so that's the sort of comment I make". I understood perfectly what you wrote.

[a447]

Dalewood wrote:
$500K seems to be enough to buy a nice waterfront place in a warm part of Australia

For that amount of money you might just be able to snare a place with a water view - that is, if you don't mind looking out over a sewerage plant!

Australia is a very expensive place to live.


Kommentariat wrote:
The British scammer didn't know that he could get away with his trickery because of Thailand's lack of a decent legal framework; .....

Really?? What a naive old scammer he must be...lol

Kommentariat wrote:
The British scammer didn't know that he could get away with his trickery because of Thailand's lack of a decent legal framework; .....Really?? What a naive old scammer he must be...lolFor a moment there I thought you had finally developed a sense of irony a447 or at least the ability to detect it in others ... and then you make this post.

[Gaybutton]

ensure they have title to the properties
Two questions come to my mind:

1. How did these people manage to buy these properties in the first place? Unless Thai law changed and I missed it, I thought foreigners could buy a condo, but cannot buy a house or property in Thailand. If that law is still in effect, the only ways I can see for them to have bought these properties would be either to have bought in the name of a Thai or if they somehow were able to have these properties legally declared to be a condo.

2. Is there such a thing as title insurance in Thailand? If there is, I'm not aware of it. If there is and if they had title insurance, then they certainly have grounds to sue the title insurance company.

[goji]

Try reading & comprehending what I wrote first.What I was expecting you to say was something like "I am an incredibly naive and stupid person with no understanding of human nature nor any knowledge of financial scams, so that's the sort of comment I make". I understood perfectly what you wrote.

The difference is I expect the people who get to this position (mature & have been smart enough to accumulate funds) to mostly make the obvious checks & understand what they are buying.
It's not rocket science, although of course there will be exceptions, which is why I had the word "most" in the original post.

Perhaps you expect everyone to be the kind of fool who is easily parted from his money? Maybe I should be making an equally inappropriate request for you to justify what you write?

Anyway, as I'm wasting my time on this particular two way discussion, it's time to look for the IGNORE function.

[thaiguest]

This should not be blamed on tit. The buyers trusted the Brit developer, that was their mistake. They knew the land was still owned by the bank but they believed that it would be paid off as more property was sold by the developer. The land was never paid off so the bank can reposes unless they come to an agreement, which looks like they cannot.Absolutely rocket, not a TIT situation at all. The British scammer didn't know that he could get away with his trickery because of Thailand's lack of a decent legal framework; he just got lucky.

Hold on there Sir.
How could you know that the British scammer DIDN'T know and got lucky?
I can think of 2 answers: either you're privy to his inner thoughts or you're the scammer posting under 'kommentariat' or both.

Thailand doesn't have any notions of civil society (in the sense of "we're all in this together"), enforceable regulation or enforceable redress. In the context of this thread - which is about a bunch of comfortably-off retirees being ripped off by failing to comprehend the lack of regulation and redress in Thai society - it is bizarre that goji believes that any evidence is needed of the foolishness of mankind

[thaiguest]

I would have to agree that civil society as westerners understand it has not yet come to Thailand or indeed to most of Asia.
People moving for the first time often assume that there's a concordance of terms to start with ie that 'police' means the same everywhere ( it does not), that private ownership is fee simple everywhere and so on.
A similar situation obtained in Spain prior to full EU membership.
The tales of woe that came out of Spain's holiday property sector in the 70's, 80's and 90's are myriad.

[lego]

I would have to agree that civil society as westerners understand it has not yet come to Thailand or indeed to most of Asia.
Indeed it "has not yet come", and chances are it never will. The Western concept of civil(ized) society is a nice ideal, but in the real world it has probably passed its zenith even in the West.

but in the real world ...Ah yes, we might have expected that patronizing sneer from someone whose nose is so far up the arse of the Thai junta that his eyes must almost be able to peek out of their mouth.

[lego]

Ah yes, we might have expected that patronizing sneer from someone whose nose is so far up the arse of the Thai junta that his eyes must almost be able to peek out of their mouth.
I've missed you, too, although you're kind of a one trick pony. Anyway, I'm in a rather festive mood, and not just because of our good old friend's birthday: In case you've followed the news this week, you'd almost have to think that the Thai junta is up our arses instead. Now, I wouldn't go that far and that wouldn't be my choice of words in any case, but your point of view is ridiculous, to quote another great man. You should be more concerned about the likes of Ambassador Kent, I think.

to quote another great man.Who?
You should be more concerned about the likes of Ambassador Kent, I think.Why?

[Smiles]

Who?

Why?
Give it a break Kommie. You're getting old fast, man.
Faster than most if you insist on keeping this nonsensical blather up.

As comic relief?: 8 out of 10 (Right up your alley. But granted, FAR better numbers than Firecat ... for what it's worth.)
As education?: 2 out of 10 (Last interesting-idea-purporting-to-be-original? Around 2004)

Thank you for your vote of confidence my dear Smiles.

I wonder how you would answer the following dilemma: A company chief executive is deemed irreplaceable, the company won't survive without him. He's also known as a person who sexually harasses many woman in the company. What would you do?

We already know lego's position - it is the pragmatic one. The company must survive come what may. He said that straight after the coup.

And let's face it - they're only women. Or in this case, only Thais. After all, white men have been deciding what's best for "the natives" for hundreds of years. If that means sucking up to the local rulers so that we may sell our beads and other trinkets rather than those dastardly Chinese that's what should be done.

However we shouldn't pretend it is the ethical position.

http://asiapacific.anu.edu.au/newmandal ... ople-sing/ (http://asiapacific.anu.edu.au/newmandala/2014/12/04/prayuth-do-you-hear-the-people-sing/)

[Gaybutton]

Is there such a thing as title insurance in Thailand?
I finally did get the answer to my question. The answer is no.

[Up2U]

Is there such a thing as title insurance in Thailand?
I finally did get the answer to my question. The answer is no.
Yes, the answer is no to your second question. Actually title insurance is a mute point since they have title to nothing.
Regarding your first question, if I understand it correctly all these buyers have is lease agreements. The article doesn't explain how they supposedly had clear title because we all know that it isn't possible. If they had gone down the Thai company path, the chanote would have at least been registered to the Thai company(not anybody is recommending that path). The best scenario would have been their lease contracts would be registered with the chanotes at the Land Office but the developer stiffed them before that could happen. If everything had gone according to plan for them I still don't understand how these contracts work. Can they sell these contracts to another buyer or is it for their personal use only?

[lego]

We already know lego's position - it is the pragmatic one. (...) However we shouldn't pretend it is the ethical position.

You're right as far as my pragmatic position is concerned, but you're dead wrong as far as my view of the Thai people is concerned. In particular, I don't see them as any less valuable than Western people, I wouldn't even make such a comparison. I think they should run their country the way they see fit. It's the Western do-gooders and bleeding hearts who claim to know exactly what's best for the Thais who are guilty of denigrating them, by holding them to their own standards which they have declared "universal" but which in fact remain only theirs.

Trying to force Western-style democracy down their throat is just as wrong as forcing Christianity down their throat was a couple of centuries ago. People like myself more or less just accept the country and its people as it is/as they are. If a military coup doesn't trigger a mass uprising in this country, I simply take note of that fact and draw my conclusions. I already had that opportunity twice, Heaven only knows how many more times it will happen in my lifetime.

If a military coup doesn't trigger a mass uprising in this country, I simply take note of that fact and draw my conclusions. I already had that opportunity twice, Heaven only knows how many more times it will happen in my lifetime.I'd expect such a response from a Johnny-come-lately to Thailand. Others of us can remember 1976 or 1992 where the Thai Army did what it does best - gunned down Thai citizens. Or perhaps you've forgotten the violence of 2010, provoked by the imposition by the army of military-sponsored government, when the Army again shot protesters?

[lego]

kommentariat, I was born in the 1970s and in the West, please forgive me that I wasn't around to follow the 1976 events and that I was still busy with high school and playing with school girls' titties (I kid you not) in 1992. Still, if you're trying to make the argument that there's no mass uprising because the army would simply shoot the protesters, that's obviously quite flawed - that didn't stop mass uprisings in other countries from happening and succeeding. Note that I write "mass uprising", not merely "uprising", it does take a critical mass of determined protesters and I just haven't seen that in Thailand yet. As you've observed the events in Thailand for much longer than myself, apparently, you of all people should realize that. There must have been successful revolutions elsewhere in that time that you've observed as well, or are you that obsessed with Thailand? Heck, even in my short time here I've seen them happen (elsewhere).

I take it that you don't think that the Thai army is very capable, and I'd concur that this is probably spot on. They couldn't suppress a major uprising and they know it. They also know, however, that it's incredibly hard to mobilize (big enough parts of) the Thai population. And I don't mean "protest for cash" schemes, I mean masses of ordinary people with real and heartfelt anger taking up arms. I've seen some of that in 2010, but not nearly on the scale that would be necessary. I think there are a number of reasons for that, but the main reason is probably that too many Thais aren't all that unhappy with their lot and therefor there just hasn't been enough anger. Call me a Johnny-come-lately or my views simplistic all you want, but I won't buy into a Thai revolution before I'll see it unfolding with my own eyes.

Call me a Johnny-come-lately or my views simplistic all you want, but I won't buy into a Thai revolution before I'll see it unfolding with my own eyes.As Matthew Henry is often quoted "None so deaf as those that will not hear. None so blind as those that will not see."