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The Dishonest Building Managers of Thailand, & Why you should Care!
 
Article submitted by Anonymous. After hearing about these practices numerous times over the past few years, MrRoomfinder has decided to publish this article so that Property Landlords or Sellers are able to make better informed decisions when looking for tenants or buyers of their property. (You may comment at the foot of this page )
Learn why some Real Estate Agents might have your property at the bottom of their priority list
It is unfortunate that in this part of the world that corruption exists in practically every level of society and in every industry. We all know and read about how corrupt the Governments of South East Asia are and how it angers us that our hard earned taxes are wasted away on Government Officials, both Senior and Junior, who horde them for their own gain.

How often do we read about huge Government projects, such as Bangkok’s new Suvanabhumi Airport for example, which cost 50-100% more than originally budgeted because of so much ‘under-the-table’ or ‘back pocket money’ has been extorted from the project?

What makes us even more annoyed and frustrated as ex-pats living in SE Asia is that we have no rights, no votes and can only sit here helpless as we see Government and Civil Service officials squandering our Taxes on S- Class Mercedes’ or flash houses and villas at home and abroad. Yes there is nothing we can do about it and we can only hope that one day the local people develop to a standard where they can intelligently vote for politicians who will benefit the people and country most, and not the politician who gives them the biggest bribe.

However as ex-pats we can take on the little guys who look up to these Government Officials and use them as role-models for their own corrupt and dishonest practices. And indeed if you are an ex-pat who owns a property in Thailand or another SE Asian country, you have probably been a victim of such corrupt practices and not even known about it.
So why is this article on Mr. Roomfinder?
This article has found its way onto this property portal because we think it’s important to highlight dishonest practices with ‘some’ of the Building Management Teams of popular Condominium blocks, and also Town House and Detached House developments where each unit is privately and individually owned, possibly by an ex-pat residing in the country. These people can be making your life unnecessarily problematic to achieve their own greedy gains.

Frequently Asked Questions

Q: What exactly is a Building Manager or the Building Management?

A: The building managers are the people who work in the Juristic Office of the condominium block, Town House or Detached House development where you may rent or own a property. They are there to serve the residents of the development.

Q: What do they do exactly?

A:
They manage the property and the communal areas. Many middle to up market developments in Thailand are complete with communal areas which contain services such as:



* Swimming Pools
* Fitness Centers
* Toilets
* Car Parks
* Security Systems
* Squash/ Tennis Courts
* Kids Play Areas



These facilities have to be serviced and maintained. The staff at the Juristic Office is in charge of managing the upkeep of these items:

* They make sure Security Guards work correctly
* They employ Gardeners to take care of the plants
* They employ Pool Cleaners for the swimming pool
* They employ Painters and Carpenters to do minor maintenance tasks and so on…

Q: How are they paid?

A: Officially they are paid by the owners of the individual units in the development. Each owner has to pay a small ‘Maintenance Fee’ each month. In Thailand these range from 20-60 Baht per Sq Meter, per month. This may seem small, but when multiplied by say 100 SQM per unit, and by 200 units in a building then it adds up to quite a considerable figure.

In addition to this, each owner pays an initial ‘Sinking Fund’ of approx. 500 Baht per Sq Meter when he/she initially purchases the unit off-plan. This figure is supposed to provide the Maintenance Team with enough money in case of emergency, and of course when it is collected it is immediately invested by the Management Organization into a high-yielding Bank account or other investments such as Shares, Real Estate or other such ventures.

No wonder then that Management Teams and Companies queue-up and bid to get contracts for new developments. it is a very lucrative business!

Q: Ok, but how do they rip me off? What sort of corruption do they deal in?

A: Firstly it’s important to point out that not ALL Building Managers are corrupt, however many are, including the ones employed by large multinationals, or at least those that are franchised out by large multinationals. This means that the owners of the units who are paying their ‘Maintenance Fees’ each month are handing over their money to people who are doing them a disservice.

Perhaps the best way to explain this is by using an actual example. I won’t reveal the name of the client, the agency involved, or the Building Management, as we don’t want to be had up for libel, but I can tell you from 3 years online with MRF and getting too know people in the business, that this is a fairly typical scenario.
Hey! What has our Agency Fee got to do with your Personal Savings Account Mr Manager?

An ex-pat from Ireland had a 1 Bedroom Condo in a new smart building in the Sukhumvit area of Bangkok. He had bought the unit to live in, and was very happy there. The building was maintained correctly and he was pleased with how things were being run. However, one day he was called back to Ireland on urgent and very upsetting family business, and knowing that this would take some time, he contacted a number of Property Agents to mange his estate.

One agent he contacted already had a client looking in that area for a 1 bedroom unit at around the same price. The agent took their prospective tenant to view the condo and he agreed to move in without further ado. So that should be the end of the story…right? WRONG!! This was the start of an all too common problem. Let’s just back track a tad…

When the agent first went to view the unit the Building Manageress was not there, she was absent and so had no knowledge of their arrival, or our the deal they had struck with their client. As they had to introduce the new tenant to the building management, they made appointments with the office on 3 more separate occasions, but each time the building manager was nowhere to be seen.

However, when the time came for the landlord to pass over the keys to the new tenant, he went to the Juristic Office and asked them to hand over the spare keys to his condo.

This action of asking for the keys back suddenly alerted the Juristic Manageress to the fact that his unit had been rented out. She inquisitively requested what rent they had settled on. In his innocence he told her what had been agreed. She then asked who had rented it out, he replied by giving her the name of the agent. As greed took over (as so often does in these situations), she had all the information she needed to start problems.

She immediately looked up the number of the agency involved in the deal and demanded a slice of the pie. She gave them some fictional story that whenever a unit is rented out in her building, that SHE is entitled to 30% commission of the agreed rental price. Yes read this again, this woman who had done NO WORK, HAD NOT ADVERTISED THE UNIT, HAD NOT FOUND THE CLIENTS and had at ALL TIMES been PAID BY THE LANDLORD indirectly wanted 30% of the deal!!

After the real estate agent refused to cut her in on their deal, she immediately called the landlord and concocted another cock & bull story to him that she and the Agent had a prior agreement to pay her 30% of any unit that was rented our or sold in her building.

Confused, the landlord called the agent for clarification, and when they explained the ridiculous situation, he was apologetic to them and thought to leave it at that. He should have had no reason to be apologetic as he had done nothing wrong, nor had the agent done anything wrong, but this greedy avaricious Building Manageress would not let it drop.

Like a dog with a bone she kept calling and calling the landlord and then the agent, trying to play one off against the other. In between her own calls, she even got other members of staff to call (pester) both parties. Finally, the landlord got so worn down by all this persistent harassment that he gave in and offered to pay her an amount equal to the 30% she was so craving. And all this for no other reason than to just to stop the phone calls. A method in her madness that had worked for her on previous occasions no doubt!

When the landlord contacted the agent to tell them what he had done, they told him he really didn’t have to do that, but as he had, and given his circumstances, they offered to pay the woman the just to keep her quiet.


In hindsight, the landlord realized what had gone on here, and requested that the agent deal with the condo next time by bypassing the office completely, without revealing any details of future transactions to them at all.

Why should you Care as an Owner if an Agent Loses Out on a Deal?
You might be reading this and asking yourself why it’s such a big issue, and why should you care as an owner if an agent loses out on a deal?

Well because this story is far from a one-off event. Agents of greater Bangkok come across Building Managers demanding commission all the time. Greedy, lazy building managers who basically want a slice of the pie for doing diddlysquat! Money they’ve neither earned nor entitled to.

As a consequence, property agencies get to recognise these corrupt places and tend to avoid them like the plague. In other words, they do not show clients units where building managers are notorious for making problems.

Unfortunately, this is bad news for owners of decent property looking for an independent agency to manage their unit(s).

Imagine this scenario; An agent has a client willing to pay $800 (US Dollars) per months for a condo, and they have 2-3 places that suit his requirements, all pretty much in the same range and of similar quality and location.

So the agent inquires at Building A and the Building Manager does his/her job and passes over the property details and keys to the room.

The agent then inquires at Building B and the Building Manager this time insists that they cannot see the condos unless he or she gets 50% of any possible commission from the deal.

Which building do you think the agent chooses to show their client? And which landlord loses out through no fault of his own?

The property could sit on the market for months and months and cost the landlord a fortune simply because of some greedy, selfish, uncaring Building Manager looking for backhanders on someone else’s property.

So what can be done?

Firstly, if you are looking to rent or sell a property, contact more agents directly about your property, do not trust the Building Manager to do a fair job for you unless you really trust they will be cooperative and have your best interest at heart.

Secondly, if the Agent tells you what happened then report the Building Manager to her superiors and write a letter of complaint to the developers and the senior management in the company.

The only way this corrupt practice can be lessened is if the landlords become more savvy and more aware of the ‘potential’ problems that can arise when looking to let or sell their property.

Thailand Real Estate

 


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