kokothemonkey

As I said before, if you're so unhappy and hate it so much, the solution is very easy.

good luck

you minsuderstood, i am happy exploiting thailand, just not living here

kokothemonkey,,are you sure you are not apeman who run exploited teens of asia.

ole koko is having cheap shots from afar. He's a long way away from Thailand. Thank God.

very true mr. patpong, very true, as i prefer to spend christmas in the first world rather than in a toilet, or the thirld world (aka, i do not like to eat where is sh**)

Like a lone voice in the wilderness, I have been saying this for some time - the property bubble is going to burst! As demonstrated by many economic examples over hundreds of years, this inevitably leads to wider economic decline, or indeed, collapse.

There are none so blind as those that do not wish to see...

As the thai py will say, up to you!

They said the same thing recently about the Australian property market.....it didn't happen and now prices are beginning to rise.

They are saying the same thing about the US property market, so far so good.

They have been saying the same thing about the Thailand property market...for years and years....it hasn't happened.

Bubbles burst, balloons deflate.

These days property markets around the world deflate in line with the 8 - 10 year property cycle. Property market collapses usually result from a market oversupply, coupled with rising interest rates.

Available land is becoming very scarce and that creates demand. There will never be a property crash as long as there is demand.

Further interest rate rises are also doubtful as the world is experiencing stagflation/deflation. The next move for interest rates may well be down.

You are not the only voice in the wilderness, but you are quickly running out of company.

you are kidding mighty mouse? thailand housing market is already starting to suffer, and by the way, the bubble is bursting in the US.....check it...

http://housing-watch.com/home.aspx?d=90

http://thehousingbubbleblog.com/

little less time with the bargirls and maybe you wont be poorer

Another post is saying there will indeed be a 30 percent hold for condo purchases (in foreign name). That is shocking. How can anyone sell a condo with that restriction?

thats just it, you wont be able to (dont forget about the massive amount of condo inventory coming online also)

the game is over

So lets recap: oversupply in Bangkok to begin with, and now 30% of any money is locked up for a year......well done Thailand, well done

Thursday December 21, 2006

NINA SUEBSUKCHAROEN

The Bank of Thailand's tough capital controls, although slightly eased after the stock market crashed on Tuesday, are scaring off foreign property buyers and will add further pressure to the market, says a local lawyer with many foreign and expatriate clients.

Under the new rules, foreigners who want to buy a leasehold property in Thailand will have no problem doing so if they can bring in Thai baht for the purpose, said Sally Ann Lefley, an associate at the Bangkok-based firm McEvily & Collins.

However, those buying freehold property, such as condominiums, will see the Bank of Thailand retain 30% of foreign funds interest-free for one year.

Ms Lefley also said that even though Thai authorities are trying to stop foreigners from setting up Thai companies to buy land and houses, those who manage to do so can buy landed real estate without having to deposit 30% with the central bank by using baht for the transaction.

James Pitchon, executive director of CB Richard Ellis, said yesterday that the central bank needed to further clarify how the controls on foreign capital inflows would affect foreign property buyers.

''We are still unclear whether it will affect overseas buyers,'' he said.

Should foreign real estate buyers have to deposit 30% of the purchase price with the Bank of Thailand for one year, it would be extremely damaging, Mr Pitchon added.

He said property was not a short-term speculative investment but a medium- to long-term one with most people buying houses and condominiums to live in. For this reason, funds used to buy property are not ''hot money'' as it cannot be sold quickly. By nature, property is illiquid. Mr Pitchon added that even if a 30% deposit with the central bank was not required, more paperwork generated by the new rules would still hurt the market.

Aliwassa Pathnadabutr, CBRE's managing director, added: ''We've been contacted by many foreigners who are concerned about not only how these regulations will affect their property purchases, but also what the effect will be in the medium to long term on the condominium market.''

Ms Lefley said that investors should simply look to lease land because the government has been enforcing regulations that restrict foreigners from setting up companies to buy land.

''Just totally forget about trying to buy land through a Thai company,'' she said. ''Things have taken place since the coup; it got very, very strict thereafter. So if a Thai company wants to buy a piece of land now, if it's 100% Thai, it's no problem. But if there is a foreign shareholder or director then the Land Office will investigate that company and check if the Thai shareholders are actually nominees for the foreign director or shareholder.''

The maximum term of a lease in Thailand is 30 years and Thai law allows one renewal of 30 years.

''You can still buy a house or a villa; it's just the land that you can't actually buy,'' Ms Lefley said. ''So you can choose to lease the house as well as the land or you can choose to buy the house outright.''

However, she cautioned that once the lease expires, the house, unless the lease agreement says otherwise, would actually become the property of the landowner.

''So whereas before sellers and buyers were concentrating more on freehold aspects, it seems that the sellers now are really getting to grips with leases and putting in more provisions, not only to protect themselves but also to protect the lessees,'' she said.

Even so, Ms Lefley noted that foreigners are not shying away from buying land and houses as her law firm had feared.

''It seems more and more are quite accepting of the option to lease. They don't seem too concerned about owning a freehold so that they can pass it on to their family when they die; it seems a lot are looking at using the property for themselves and not looking to pass it down.''

So lets recap: oversupply in Bangkok to begin with, and now 30% of any money is locked up for a year......well done Thailand, well done

Thursday December 21, 2006

NINA SUEBSUKCHAROEN

The Bank of Thailand's tough capital controls, although slightly eased after the stock market crashed on Tuesday, are scaring off foreign property buyers and will add further pressure to the market, says a local lawyer with many foreign and expatriate clients.

Under the new rules, foreigners who want to buy a leasehold property in Thailand will have no problem doing so if they can bring in Thai baht for the purpose, said Sally Ann Lefley, an associate at the Bangkok-based firm McEvily & Collins.

However, those buying freehold property, such as condominiums, will see the Bank of Thailand retain 30% of foreign funds interest-free for one year.

Ms Lefley also said that even though Thai authorities are trying to stop foreigners from setting up Thai companies to buy land and houses, those who manage to do so can buy landed real estate without having to deposit 30% with the central bank by using baht for the transaction.

James Pitchon, executive director of CB Richard Ellis, said yesterday that the central bank needed to further clarify how the controls on foreign capital inflows would affect foreign property buyers.

''We are still unclear whether it will affect overseas buyers,'' he said.

Should foreign real estate buyers have to deposit 30% of the purchase price with the Bank of Thailand for one year, it would be extremely damaging, Mr Pitchon added.

He said property was not a short-term speculative investment but a medium- to long-term one with most people buying houses and condominiums to live in. For this reason, funds used to buy property are not ''hot money'' as it cannot be sold quickly. By nature, property is illiquid. Mr Pitchon added that even if a 30% deposit with the central bank was not required, more paperwork generated by the new rules would still hurt the market.

Aliwassa Pathnadabutr, CBRE's managing director, added: ''We've been contacted by many foreigners who are concerned about not only how these regulations will affect their property purchases, but also what the effect will be in the medium to long term on the condominium market.''

Ms Lefley said that investors should simply look to lease land because the government has been enforcing regulations that restrict foreigners from setting up companies to buy land.

''Just totally forget about trying to buy land through a Thai company,'' she said. ''Things have taken place since the coup; it got very, very strict thereafter. So if a Thai company wants to buy a piece of land now, if it's 100% Thai, it's no problem. But if there is a foreign shareholder or director then the Land Office will investigate that company and check if the Thai shareholders are actually nominees for the foreign director or shareholder.''

The maximum term of a lease in Thailand is 30 years and Thai law allows one renewal of 30 years.

''You can still buy a house or a villa; it's just the land that you can't actually buy,'' Ms Lefley said. ''So you can choose to lease the house as well as the land or you can choose to buy the house outright.''

However, she cautioned that once the lease expires, the house, unless the lease agreement says otherwise, would actually become the property of the landowner.

''So whereas before sellers and buyers were concentrating more on freehold aspects, it seems that the sellers now are really getting to grips with leases and putting in more provisions, not only to protect themselves but also to protect the lessees,'' she said.

Even so, Ms Lefley noted that foreigners are not shying away from buying land and houses as her law firm had feared.

''It seems more and more are quite accepting of the option to lease. They don't seem too concerned about owning a freehold so that they can pass it on to their family when they die; it seems a lot are looking at using the property for themselves and not looking to pass it down.''

lessons? yes, dont go to thailand for anything but fun

it is just a very large casino and as in every casino, the house ALWAYS wins

thailand truly is "amazing".......lol

other than food and ladies, this place has no redeeming value

"I don't see foreigners returning to Thailand any time in the near future. Markets now have no confidence in the government."

Asia markets rebound, but Thai credibility hurt

Abrupt policy shift undermines investor faith in Thailand's new government.

December 20 2006: 7:05 AM EST

BANGKOK (Reuters) -- Thai shares bounced back on Wednesday from their biggest sell-off in 16 years after the government back-pedaled on currency controls, but the abrupt policy U-turn shattered confidence in its economic chiefs.

The stock market, which plunged 14.8 percent on Tuesday - its biggest one-day drop since Iraq invaded Kuwait in 1990 - ended 11.2 percent higher after the army-appointed government exempted stock buying from controls on short-term currency inflows just a day after imposing them.

Elsewhere in Asia, Hong Kong's Hang Seng gained 1.45 percent and the HSCC Red Chip fell 1.76 percent. Japan's Nikkei 225 gained 1.40 percent, while China's Shanghai Composite gained 0.38 percent.

The stunning about-face in Thailand in the wake of a foreigner-led rout that knocked $23 billion off Asia's worst-performing bourse this year rekindled memories of the 1997/98 Asian financial crisis and brought howls of derision from analysts.

"The one thing worse than an incompetent central bank is an incompetent central bank that flip-flops," said Bratin Sanyal, head of Asian equity investments at ING in Hong Kong.

Domestic investors were equally scathing in their criticism of the technocrats appointed by the military leaders who ousted Prime Minister Thaksin Shinawatra in a Sept. 19 coup.

"I'm stunned. They are truly incapable. Please, get the hel_l out," said 35-year-old businessman Chan Pornpipatkul.

The rally, spearheaded by big-cap stocks such as oil-and-gas firm PTT PCL and Bangkok Bank - owned in part by the foreigners who stampeded for the exit on Tuesday - was the market's biggest one-day jump since February 1998.

But most of the buyers were Thai, as international investors continued their retreat, selling a net $81 million of shares to go with the $700 million they dumped on Tuesday.

"Investor hel_l"Despite its recovery, the index was still 5 percent lower than when the Bank of Thailand (BoT) announced on Monday a drastic assault on the speculators it blamed for catapulting the currency 16 percent higher in 2006 against the dollar.

The International Monetary Fund (IMF), describing the baht measures as "too strong and far-reaching," welcomed the decision late on Tuesday to lift the restrictions for equity investments.

But by then Thailand's reputation in the eyes of international investors was in tatters.

IDEAglobal headlined a research note "Tourists' haven, investors' hel_l," as analysts poured scorn on Finance Minister Pridiyathorn Devakula and his successor as central bank chief, Tarisa Watanagase, both appointed after the coup.

"They are proving themselves to be very unprofessional. Their actions are very irresponsible. They have totally lost credibility," said Catherine Tan, head of Asia Emerging Markets at Forecast in Singapore.

"I don't see foreigners returning to Thailand any time in the near future. Markets now have no confidence in the government."

Tarisa, appointed just two months ago, agreed with her former boss that equity investments should have been exempted from the rules and admitted that the sell-off had taken them by surprise.

"We had to reverse the measures as the market reacted more than we expected," she told reporters.

ABN AMRO cut its investment rating on Thailand to "underweight" and questioned how the economy was being run in the aftermath of the coup, Thailand's 18th in 74 years.

"Policy decision-making seems to be at odds with the workings of capital markets," the investment bank said.

Intervention questionedThe sell-off sparked brief fears of a repeat of the 1997/98 Asian financial crisis, triggered by a baht devaluation, and prompted falls in stock markets in the region, though they also recovered on Wednesday.

Bond yields were largely steady in Thailand's secondary market on Wednesday, with those on the long end falling slightly after central bank intervention, dealers said. Yields had jumped 20-40 basis points across the board on Tuesday.

"Why did they intervene in the bond market today? They should have known bond markets would fall after the baht measure," Forecast's Tan said.

The baht, the strongest Asian currency against the dollar this year, was trading around 35.8 per dollar, a decline of around 2 percent from Monday's 9-1/2-year high that triggered the BoT's leap to the defense of exporters.

The curbs were designed to rein in the baht's rise by forcing speculators to keep their money in the country for at least a year or face a hefty 10 percent penalty.

Trade-related deals and repatriation of funds by Thai residents were excluded. Pridiyathorn added equity-related transactions to the exclusions late on Tuesday.

Exporters had welcomed the curbs because a rising baht makes their goods less competitive on world markets and could reduce earnings repatriated from overseas.

As I said before, if you're so unhappy and hate it so much, the solution is very easy.

good luck

you minsuderstood, i am happy exploiting thailand, just not living here

other than pad thai and easy women, why would i want to move here?

With an attitude like that, why would Thailand want you?

The road to Cambodia is to your left. Have a good trip.

wrong question, why would i want thailand? lets see:

1) coup (sept 2006)

2) bird flu (ongoing)

3) flooding (oct/nov 2006)

4) earthquake (dec 2006 in chiang mai)

5) psunami (dec 2004)

6) bombings (daily basis in the south)

7) and now morons running the capital markets...aka $20+ billion wiped out in a day

8) did i miss anything?

i assume you like thailand beacuse you would rather be king among the idiots rather than average among the intelligent.

thailand is a great place for the dregs who cant cut it in the west.

Are you doing a current event report for school?

I think its a reasonable question.

Many people on the forum are not interested in the economics in LOS...thry only want to know how Government legislation affects them personally.

edited due to a smelling pisstake

that is what makes them so stupid only to whine later rather than understand the mess being made

other than pad thai and easy women, why would i want to move here?

Home > Breakingnews > Foreign house buyer affected by baht measure

Foreign house buyer affected by baht measure

Impacts of the Bank of Thailand's austere capital control measure spreads beyond the stock market, as an expatriate sees a problem in settling a house purchase deal scheduled Wednesday.

The expat who contacted The Nation but asked not to be named transferred 150,000 euro from a bank in Hong Kong to Kasikornbank Tuesday, without knowing of the measure.

He was shocked to know that 30 per cent of his money would be parked with Kasikornbank once he converted the foreign currency into Thai baht.

"Only if the central bank averts the policy, would I have enough money to sign the contract. If this policy remains, I would need 30 per cent more for the house that I have reserved," he said.

The Nation

other than pad thai and easy women, why would i want to move here?

December 20, 2006 : Last updated 07:43 pm (Thai local time)

Foreign house buyer affected by baht measure

Impacts of the Bank of Thailand's austere capital control measure spreads beyond the stock market, as an expatriate sees a problem in settling a house purchase deal scheduled Wednesday.

The expat who contacted The Nation but asked not to be named transferred 150,000 euro from a bank in Hong Kong to Kasikornbank Tuesday, without knowing of the measure.

He was shocked to know that 30 per cent of his money would be parked with Kasikornbank once he converted the foreign currency into Thai baht.

"Only if the central bank averts the policy, would I have enough money to sign the contract. If this policy remains, I would need 30 per cent more for the house that I have reserved," he said.

The Nation

[/b]

Depends the investor.

Those who are going bring money (in dollars) in to invest for more than 1 year just saw the baht fall, making their investment a bit cheaper.

Also some exporters got a much need pause in the baht's rise.

not all bad.

A pig in a dress is still a pig. Much safer and more stable places to invest instead of a third world country run by a junta.

Also don't forget the bombings in the south. Only a matter of time before they begin in Bangkok.

too late, that money is gone

who in their right mind would invest in thailand when it is obvious that the leadership has NO CLUE as to what they are doing?

better to give your money to a bargirl and have fun before lose it all

Well, very interesting.

I wonder what affect this will have on people transferring say $100K into their account to buy a condo??

Do they have to wait a year to use the money?? Regards, BD

my question would be,

Why would anyone want to put $100k into a country run by a junta when there are numerous other places to safely palce your dough?

Also, when will the muslims move the bombings from the south to Bangkok? In due time, in due time.

I am due to retire to Thailand in the new year and was going to transfer all my capital there on the basis that if I am going to live there I should have some loyalty to the country.

All going offshore now.

Bloody hel_l they are such thieves I think they have been talking to Tony Blair here

dont forget they will alos devalue the baht to 38 to prop up exporters so assume 30% plus anouther 6% (2/36 to 38)

LOS = Land of Stealing

Is that $20,000 the limit per week? Month? Year? What if I bring $5,000/day? They'll wait for me to accumulate $20,000 and then hit me with a 30% tax or what?

better choice is to not send to money to LOS. they will devalue baht to 38 jsut to prop up exporters. so assume 30% plus any loss on depreciating baht of 6% (2/36 to 38)

I have just decided that I will move to LOS this summer. Will get a retirement visa. I am aware of the requirement for ~ $23,000 in a Thai bank 3 months prior to app. Does anyone have a recomendation on off shore banks, that may have offices in Thailand, where I can keep the rest of my funds? I am also looking for good interest rates, not just a safe place to stash it. I want to transfer my funds out of the US & away from the greedy hands of the new congress.

Are you sure you want to do that?

As from Tuesday, 30 per cent of all foreign currency inflows of more than $20,000 will be held on deposit – interest free – by the central bank, unless it relates to a trade in goods or services.

http://www.ft.com/cms/s/6073a4f4-8ec7-11db...00779e2340.html

This article shows the Condominium Market is still very Strong, recently reported from the Thailand Property Report on October 10th 2006.

With more units being completed, new condominiums bought for investment purposes are now being put up for rent. Though targeting primarily the same group of expats working in Bangkok, the apartment market has yet to experience any significant impact from increased condominium for rent competition, according to the latest study by Jones Lang LaSalle.

"The apartment market in central Bangkok has continued to perform well with the average occupancy rate standing at over 90%, driven by strong demand from expats," Dan Tantisunthorn, Head of Research at Jones Lang LaSalle.

"An increasing number of expats has continued to sustain healthy performance in the apartment sector despite higher competition with condominiums for rent. However, competition is likely to further intensify as more condominium projects are scheduled for completion over the next few years."

According to a Jones Lang LaSalle's study, 2006 will see a total of 34 new condominium projects with over 7,600 units completed in central Bangkok. "While the ratio of owner-occupied units to for-rent units across the market is difficult to estimate, we anticipate 25% of the units completed condominium buildings being offered for rent," said Tantisunthorn. "However, we do not believe the apartment market will be significantly affected by competition from condominiums due to the distinct natures of the two types of developments," noted Mr. Dan. "Apartments are purpose built for rent and thus offer features that are tailored to tenant requirements, including specific conceptual and architectural designs, unit sizes, and furnishing as well as tenant management," he added.

Three developments were completed in the first half of 2006, comprising of a total of 82 units. Two of these, Baan Pipat (28 units) and The Convento Boutique (21 units), are in the CBD, and one, The Pentacles (33 units), is in the Sukhumvit area.

While many projects scheduled for completion in the first half of the year were delayed to the second half, six projects of around 170 units were withdrawn from the market for renovation in order o stay competitive. As a result, the total stock of apartments in Bangkok decreased from 10,980 at the end of 2005 to 10,900 in July, 2006.

By the end of 2H06, 470 additional units are expected to be completed, mostly in the Sukhumvit area, which remains the most sought after location for expatriates. Its accessibility to the new international airport and the anticipated extension of the Mass Rapid Transit System to the eastern part of Bangkok are further boosting the area's popularity.

Despite strong demand for luxury apartments in the CBD and Sukhumvit areas in the first half of 2006, only around 50 units were taken up. This is manly the result of limited availability of supply in the market. The average occupancy rate for apartments increased from 92.9% at the end of 2005 to 93.8% in July 2006.

Although new supply is expected to rise further during the second half of the year, more apartments are expected to be withdrawn from the stock for renovation, according to Jones Lang LaSalle. Due to the limited supply, rents are likely experience additional increases. Demand for apartments in Bangkok will likely remain strong over the second half of 2006 as the number of expatriates, particularly those from Japan, is expected to continue growing.

The study also noted there will be more pressure on owners of older projects to renovate their units, from not only the new supply of apartments, but also the growing number of service apartments and condominium units for rent.

LOL....that article is 2 months old.....hear is a dose of reality....

GHB warns of oversupply in budget condominiums (Dec 2006)

May soon propose leasehold extensions

KANANA KATHARANGSIPORN

The Government Housing Bank (GHB) has warned of an oversupply in budget condominiums in the next few years as the number of high-rise housing construction permits has more than doubled. GHB president Khan Prachuabmoh said there was a great number of new budget condominium developments this year as homebuyers hoped to secure places near mass transit lines.

''But it has not yet reached a new bubble,'' Mr Khan said. ''Buyers should be more selective and choose a reliable developer.'' (YOU CANT SEE A BUBBLE WHEN YOU ARE STANDING IN THE CENTER OF IT)

According to statistics released yesterday by the Real Estate Information Centre (REIC), the number of high-rise housing construction permits in the Greater Bangkok area totalled 895 buildings in the second quarter of 2006, :signs-wallbash: rising by 162% quarter-on-quarter and 91% year-on-year. :signs-wallbash: (NOTHING LIKE TOO MUCH SUPPLY)

Meanwhile, the total area of high-rise housing construction permitted in the Greater Bangkok area was about 4.93 million square metres, up 133% quarter-on-quarter and 483% year-on-year, said Mr Khan. (FOR THE LOVE OF BUDDHA)

The number of high-rise housing construction permits nationwide totalled 1,045 buildings, up 129% from the first quarter and 28% from the same period of 2005, with a total area of 5.21 million sq m. That's a quarterly increase of 117% and an annual increase of 358%.

As of the third quarter of 2006, the number of newly registered houses in Greater Bangkok totalled 24,276 units, up 16% from the second quarter.

Mr Khan also expressed concern about the construction of too many single houses priced at more than five million baht a unit, as market demand was moving down to lower-priced units.

During the first nine months of the year, there were 60,734 units newly registered in the Greater Bangkok area, a 14% increase from the same period of 2005. Of those, 11,004 units were single houses, a 3% decrease from the previous quarter, followed by townhouse and shophouses with 6,573 units, a 111% quarterly increase.

''The good news for investments next year is a downward trend in oil prices, interest rates and inflation. Politics will be clearer as a draft constitution is expected to finish within next year,'' he said.

At the same time, the depreciation of the US dollar and a strengthening Thai baht will help reduce oil costs. Mr Khan added that interest rates would definitely drop next year.(THIS IS DEFLATIONARY AND NOT INFLATIONARY)

''The real estate industry still has potential and will grow further as the two richest Thais (Anant Asavabhokin and Thongma Vijitpongpun) are in this industry,'' he said.

The GHB plans to talk with the Finance Minister about an extension of the leasehold period for foreign buyers from 30 years to 99 years, as it would increase the value of properties.

However, the rules might be stricter, such as higher taxes to prevent speculation.

Interest rates more than doubled from 2.5% in 2003 to more than 7% this year, prompting the bank to increase monthly payments for those in the Baan Ua-arthorn low-cost housing project from 1,500 baht at the end of September to about 2,400 baht. To help reduce the burden for Baan Ua-arthorn buyers, the GHB would propose a support plan for the bank to continue releasing lower-interest loans.

Is the already on? Can they do that? I am not sure I understand...if I transfer, for example US 10000$ into my thai bank account, I can not withdraw them unless I pay US 3000$? If this is the case, I'd better transfer my money in Singapore from now on and travel anytime I need cash, it would be cheaper...

Yes, but actually it is 33% any investment in as of Tuesday Dec 19 as per the article. LOS....does that stand for Land of Stealing?

Its happening because of the lockup of foreign funds. Basically your funds will be held hostage while they devalue the baht to protect the locals and the junta gives itslef a raise.

Thailand acts to aid its currency

http://www.iht.com/articles/2006/12/18/business/baht.php

Based on this, that would be a RESOUNDING NO.

So let me see, basically 30% of my money would be held hostage to support a junta?

Bank regulators in Thailand on Monday required banks to lock up 30 percent of new foreign currency deposits for a year in an effort to stop investors speculating on gains in the baht.

http://www.iht.com/articles/2006/12/18/business/baht.php

Another great reason to invest in LOS? I think not....

thanks but I'll keep my money offshore where I have access to it, instead of where a bunch of corrupt military clowns dictate the rules

1) junta

2) bombings

3) Bank regulators in Thailand on Monday required banks to lock up 30 percent of new foreign currency deposits for a year in an effort to stop investors speculating on gains in the baht.

http://www.iht.com/articles/2006/12/18/business/baht.php

The rich get richer, baby. Follow the money!

As long as they stay out of political office, their fortunes should be allowed to grow exponentially.

LOL.....this means that the rich get richer by selling to the poor suckers at the bottom of the food chain trying to get rich.

It truly is funny how dreaming gets in the way of reality, but then again when most people think they are smarter than they really are, what can else can you expect?

GHB warns of oversupply in budget condominiums (Dec 2006)

May soon propose leasehold extensions

KANANA KATHARANGSIPORN

The Government Housing Bank (GHB) has warned of an oversupply in budget condominiums in the next few years as the number of high-rise housing construction permits has more than doubled. GHB president Khan Prachuabmoh said there was a great number of new budget condominium developments this year as homebuyers hoped to secure places near mass transit lines.

''But it has not yet reached a new bubble,'' Mr Khan said. ''Buyers should be more selective and choose a reliable developer.'' (YOU CANT SEE A BUBBLE WHEN YOU ARE STANDING IN THE CENTER OF IT)

According to statistics released yesterday by the Real Estate Information Centre (REIC), the number of high-rise housing construction permits in the Greater Bangkok area totalled 895 buildings in the second quarter of 2006, :signs-wallbash: rising by 162% quarter-on-quarter and 91% year-on-year. :signs-wallbash: (NOTHING LIKE TOO MUCH SUPPLY)

Meanwhile, the total area of high-rise housing construction permitted in the Greater Bangkok area was about 4.93 million square metres, up 133% quarter-on-quarter and 483% year-on-year, said Mr Khan. (FOR THE LOVE OF BUDDHA)

The number of high-rise housing construction permits nationwide totalled 1,045 buildings, up 129% from the first quarter and 28% from the same period of 2005, with a total area of 5.21 million sq m. That's a quarterly increase of 117% and an annual increase of 358%.

As of the third quarter of 2006, the number of newly registered houses in Greater Bangkok totalled 24,276 units, up 16% from the second quarter.

Mr Khan also expressed concern about the construction of too many single houses priced at more than five million baht a unit, as market demand was moving down to lower-priced units.

During the first nine months of the year, there were 60,734 units newly registered in the Greater Bangkok area, a 14% increase from the same period of 2005. Of those, 11,004 units were single houses, a 3% decrease from the previous quarter, followed by townhouse and shophouses with 6,573 units, a 111% quarterly increase.

''The good news for investments next year is a downward trend in oil prices, interest rates and inflation. Politics will be clearer as a draft constitution is expected to finish within next year,'' he said.

At the same time, the depreciation of the US dollar and a strengthening Thai baht will help reduce oil costs. Mr Khan added that interest rates would definitely drop next year.(THIS IS DEFLATIONARY AND NOT INFLATIONARY)

''The real estate industry still has potential and will grow further as the two richest Thais (Anant Asavabhokin and Thongma Vijitpongpun) are in this industry,'' he said.

The GHB plans to talk with the Finance Minister about an extension of the leasehold period for foreign buyers from 30 years to 99 years, as it would increase the value of properties.

However, the rules might be stricter, such as higher taxes to prevent speculation.

Interest rates more than doubled from 2.5% in 2003 to more than 7% this year, prompting the bank to increase monthly payments for those in the Baan Ua-arthorn low-cost housing project from 1,500 baht at the end of September to about 2,400 baht. To help reduce the burden for Baan Ua-arthorn buyers, the GHB would propose a support plan for the bank to continue releasing lower-interest loans.