HOW TO CHOOSE THE RIGHT DEVELOPER WHEN BUYING REAL ESTATE IN PHUKET

When buying real estate, the developer you choose is one of the most important factors that determine how satisfied you will be with the final product. In Phuket, there are reputable developers, both local Thai companies and foreign ones, each offering their own market expertise. However, any company, even a major corporation, can run into trouble. If a developer experiences financial difficulty, every buyer assumes a parallel personal risk.

What Can Go Wrong with a Developer in Phuket? Financial difficulty is a major concern for potential investors. The bigger the financial problems and the more severe the mistakes made, the greater the chance of financial loss for buyers. It is best to avoid any problems altogether by staying away from risk-heavy developers.

Small Local or Large Multinational? Developers in Phuket range from small local or foreign companies to large foreign or well-known Thai companies. For foreign buyers, the 51% Thai ownership requirement for condominiums makes established Thai developers attractive because of their reputation and high demand for their projects. Private companies are not disqualified from consideration, provided they have their accounts properly audited.

Public Listed Company or One Man Band? Buyers dealing with established companies expose themselves to less risk than those dealing with small developers. Sound legal representation is one of the best defenses against a potentially suspect developer. It is also important to consider “Key Man Risk” and ensure that private companies have taken out insurance to protect against the death of a crucial member.

How to Avoid Risky Developers? Thorough due diligence on a developer greatly diminishes the risk of anything going wrong. If an investigation of the developer leaves you unsure, it is better to stay out.

In summary, reputation should not be the only criterion for selecting a property. Private developers may expose buyers to greater risk, but this does not mean they should be discounted. Thorough due diligence is crucial when choosing a developer to avoid any financial loss.