The Importance of Property Developers in Thailand and How to Choose the Right One

Learn more about what makes a successful property developer in Thailand and how they can be of use to you in this article by PropertySights Real Estate.

7 Most Important Criteria for Real Estate Developers in Thailand

Investing in real estate can be intimidating, and that’s where property developers come in. They have specialized knowledge and skills, allowing them to put together a project that suits the client’s lifestyle and monetary restraints.

As purchasing property from a developer is one of the largest transactions most people will make in their lifetime, doing your research is crucial to protecting that investment. Here are the 7 most important criteria for real estate developers in Thailand:

1. Financial Stability
2. Collaborative Organization of Management
3. Quality of workmanship
4. Sustainable history and experience
5. A reputation for integrity
6. Customer-centric after-sale service
7. Responsive communication and consultation

When making a real estate investment in Thailand, choosing a developer with these qualities is crucial.

Financial Stability

Ensuring that a real estate development company is financially sound should be step one when searching for a property developer in Thailand. This is because a sudden bankruptcy in the middle of your project can have several worrying consequences for you:

• Financial costs. This could be money already paid to the property developer. It can also be costly to have a new real estate development company take on the unfinished project.
• Legal headaches. If you decide to take legal action, it can be both financially and emotionally straining.
• Security concerns. While waiting for a new company to take over, your property may be sitting unfinished with valuable materials exposed.

One of the ways you can confirm a company’s solvency is by checking the state of their current operations. In the case of publicly listed property developers, financial statements must be made publicly available based on standards set by the Thai Securities and Exchange Commission.

In the case of a privately run business, you can look for indications of their financial state by visiting their current work sites to see if people are working. A busy site is a good sign, but few or no workers could mean that a company is struggling to pay wages.

Collaborative Organization of Management

A company’s internal structure can tell you a lot about how much you can put your faith in them. Having the same construction team signing off on the quality of their own finished job, for example, is a bad sign. Here are some ways you can dig into a developer’s internal organization:

• Check the company’s LinkedIn for various C-suite managers such as CEOs, CFOs, and CIOs.
• Read through publicly available information on the real estate developer’s website.
• Look through the company’s Facebook page.
• Check reviews on Google Maps.

Ideally, a developer will have a collaborative management model with different people in charge of various sections, with project managers assigned to supervise each stage of development.

Quality of Workmanship

Another good reason to visit a company’s work sites is to examine the quality of the workmanship. Take a close look at the quality of bathroom fittings, tiles, and flooring to see if it’s up to the standards you want for your property.

The type of structure design is just as important. If you’re looking for a traditional Thai house you’ll have plenty of options, but you may want to be pickier with the company if you’re going for a more foreign style. Take a peek at the company’s real estate portfolio to see if they can achieve the look you’re striving for.

Sustainable History and Experience

Finding a property developer with history and experience with similar-sized projects often means that they will have the connections and know-how to move a project along more smoothly. There are many factors that make the land of smiles different from other property development environments, so it can pay to shop locally.

A Reputation for Integrity

If a business doesn’t have a reputation for integrity, there’s a possibility that they may go back on the promises they’ve made or tack on additions to the original quoted cost.

Many people find this out too late – when they’re already financially invested and can’t remove themselves from the purchase without taking a hit. That’s why asking past clients for their experiences is crucial. It can help you avoid dishonest developers and taking on a headache of your own.

Customer-Centric After-Sale Service

While you’re asking past clients about a company’s integrity, you can also ask about their after-sale service and how customer-centric it is. Put another way: Does the company cooperate with you when you’re considering alterations to the original plan? If not, you may end up settling for a property you’re not 100% satisfied with.

You can also weed out these issues in early talks with a property developer to see how open they are to changing the architectural design or look for a property management service that can handle it for you.

Responsive Communication and Consultation

Are you able to communicate effectively with the company you’re consulting with? If yes, you have one less thing to worry about.

However, a problem that sometimes pops up with property developers in Thailand is a linguistic or cultural barrier. If you don’t speak Thai, you’re better off with a property consultation service that can cater to your language. A willingness to communicate project details is crucial, too.

Why Is Property Development Important for Investment?

Property development is important for investment because it can increase the value of real estate through land and structure improvements.

On its own, land value in a good location can appreciate, but the job of real estate developers is to make improvements that turn the land into an even more attractive and prized possession. This can involve excavation, navigating utility lines, and building high-quality structures.

Because of the complexity of the job, choosing the right developer is crucial and can make a big difference in the return on your investment.

What Are the Steps for Achieving Successful Property Development in Thailand?

Take the following steps for successful property development in Thailand:

1. Assess finances, make a budget for yourself, and consult with a property developer around that budget. They will then begin a feasibility study to assess what’s possible within your means and what will result in the best investment given market conditions. This includes:
   • Assessing zoning laws and regulations such as building height restrictions for coastal properties
   • Title deed covenants and restrictions
   • Environmental regulations like the 2007 Office of National Resources and Environment Policy and Planning rules on planting trees for every AC unit of 12,000-24,000 BTU.
2. Design the project.
3. Tender offers for construction.
4. Complete construction.
5. Receive the finished property.

What You Should Consider before Hiring a Real Estate Contractor?

Consider the following before hiring a real estate contractor:

• What is the contractor quoting? Be careful with suspiciously low offers as they can sometimes be a sign that the company is looking for quick cash to make up for failed deliveries on other work.
• What do past clients have to say about them? If a contractor doesn’t have a good reputation, it’s probably for a good reason.
• What type of projects is the contractor working on currently and in the past? Not all contractors specialize in the same type of property development. If they have projects that are similar to what you’re looking to accomplish, that’s a good sign.
• How long is the contractor saying the project will take? Ideally, this would match your goals.
• What are the contingency plans for troubles with the project? Try to protect your money as much as possible from potential struggles in the future.

Looking for advice on future property developments? Contact PropertySights Real Estate today and gain access to in-depth real estate knowledge and services.