Property Prices Over Next Decade?

[FruitPudding]

So, any ideas as to what the Thai property market is going to do over next decade? Up? Down? Flat?

 

With the Aussie bubble popping, I just wonder about here.

 

Is it overvalued now? Of course, if you hold for 30-40 years, it is cheap now -- but what about the next decade?

 

 

 

[Peterw42]

To know what the market is going to do would entail knowing what its currently doing, lol

Any status, commentary, speculation, prediction, of the Thai property market is often not based on much data, there often is not much data out there.

In the west you can have access to any range of property data from the amount of new loans being written to the last 5 sales in your street, rental returns, auction clearance rates, percentage gains/losses etc.

Without hard data, its opinion based on nothing.

The status of the house/condo next door is unknown, last sales price, occupied/unoccupied, how many unsold in the estate or condo block etc. I still dont know what "empty" condo means, owned but unoccupied, built by the developer but unsold.

Often asking prices are based on what the guy next door is asking and he is basing it on what the guy on the 5th floor is asking, meanwhile condos are changing hands in the same block for half that asking price.

 

I have always believed a good indication of a properties actual value is the rental return, if it gets 2% rental return its overpriced or the bubble is about to burst, if it gets 10% its good value. In Thailand some segments of the market get good rental returns. In the absence of any other data in Thailand its maybe the only indicator that means anything.

 

[Anythingleft?]

People have been saying the Thai market is on it's knees for the last 8 years
Still building like there's no tomorrow and the Chinese seem to be taking anything they can lay their hands on....

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[BritManToo]

15 minutes ago, Anythingleft? said:

People have been saying the Thai market is on it's knees for the last 8 years

If you have no right to live in this country, there seems little point in buying property here for cash.

The housing market is irrelevant.

[Anythingleft?]

If you have no right to live in this country, there seems little point in buying property here for cash.
The housing marker is irrelevant.

Doesn't seem to be stopping anybody except for maybe a very limited minority.....

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[NCC1701A]

5 hours ago, FruitPudding said:

With the Aussie bubble popping, I just wonder about here.

there is no correlation between AU EU USA or western real estate markets and Thailand.

 

since 1997 it is driven by a completely different set of forces. 

[jackdd]

6 hours ago, FruitPudding said:

Of course, if you hold for 30-40 years, it is cheap now

Looking at the quality of buildings in Thailand, i would say after 30-40 years the value of the building is about zero, so the value depends on how much the price of the land increased

[FruitPudding]

1 hour ago, NCC1701A said:

there is no correlation between AU EU USA or western real estate markets and Thailand.

 

since 1997 it is driven by a completely different set of forces. 

Interesting.

 

I would love it if you could elaborate when you have time. I never considered this

[FruitPudding]

12 minutes ago, jackdd said:

Looking at the quality of buildings in Thailand, i would say after 30-40 years the value of the building is about zero, so the value depends on how much the price of the land increased

True.

 

Maintanence is also a factor.

 

I reckon build quality is getting better though. I worked as an electricial back west. The buildings nowadays here seem to be built to a decent standard. Although, I aint an expert on foundations

[BritManToo]

1 minute ago, FruitPudding said:

The buildings nowadays here seem to be built to a decent standard. Although, I aint an expert on foundations

They reversed the live an neutral wires coming from the meter to my fusebox.

They didn't realise they were supposed to screw the lid of the septic tank onto the tank.

 

That was two major dangerous faults when they built my house a few years back.

But the foundations/concrete and roof are fine.

[BritManToo]

11 minutes ago, FruitPudding said:

I would love it if you could elaborate when you have time. I never considered this

House prices in the UK are artificially forced up by planning permissions restricting land available for building.

I know its the same in Oz, and women force nearly every adult to live in a home of their own, forcing up prices again.

 

In Thailand you can build (almost) anywhere you like, and they're happy living 10 to a room.

[FruitPudding]

5 hours ago, Peterw42 said:

To know what the market is going to do would entail knowing what its currently doing, lol

Any status, commentary, speculation, prediction, of the Thai property market is often not based on much data, there often is not much data out there.

In the west you can have access to any range of property data from the amount of new loans being written to the last 5 sales in your street, rental returns, auction clearance rates, percentage gains/losses etc.

Without hard data, its opinion based on nothing.

The status of the house/condo next door is unknown, last sales price, occupied/unoccupied, how many unsold in the estate or condo block etc. I still dont know what "empty" condo means, owned but unoccupied, built by the developer but unsold.

Often asking prices are based on what the guy next door is asking and he is basing it on what the guy on the 5th floor is asking, meanwhile condos are changing hands in the same block for half that asking price.

 

I have always believed a good indication of a properties actual value is the rental return, if it gets 2% rental return its overpriced or the bubble is about to burst, if it gets 10% its good value. In Thailand some segments of the market get good rental returns. In the absence of any other data in Thailand its maybe the only indicator that means anything.

 

Thanks for the informative reply!

 

Could you explain more about the % rental return? I don't understand.

[FruitPudding]

13 minutes ago, BritManToo said:

They reversed the live an neutral wires coming from the meter to my fusebox.

They didn't realise they were supposed to screw the lid of the septic tank onto the tank.

 

That was two major dangerous faults when they built my house a few years back.

But the foundations/concrete and roof are fine.

What do you mean they reversed the live and neutral?

 

I do agree, there are some cowboys especially in electrics. I had to put the earth rod in myself here. The "spark" was laughing at me.

[BritManToo]

3 minutes ago, FruitPudding said:

What do you mean they reversed the live and neutral?

You're an electrician and you don't know?

It means the neutral wires in your house are live all the time, touch them even if the fuse is OFF and you get jolted.

 

[FruitPudding]

20 minutes ago, BritManToo said:

You're an electrician and you don't know?

It means the neutral wires in your house are live all the time, touch them even if the fuse is OFF and you get jolted.

 

Electricity doesn't know what color it is flowing down. 

 

Aside from that, he could have meant the electricial cross-connected the neutral into the live terminal (not at board).

 

Or maybe the consumer was confused about the color differences around the world and perhsps the electrician didn't make a mistake. So that is why I was inquiring.

 

Also, it would make no difference to the consumer if the colors were wrong (unless he attempted to fanny around with the wires himslelf.......i.e DIY).

 

But a qualified electricial would notice the neutral being the live and would not tough it. We don't "work live" unless absolutely neccessary anyway -- still the fault would be picked up.

 

And if the fuse is off no power would be flowing down any wire (wrong or right color), so no jolt!

[BritManToo]

3 minutes ago, FruitPudding said:

But a qualified electricial would notice the neutral being the live and would not tough it. We don't "work live" unless absolutely neccessary anyway -- still the fault would be picked up.

Not in Thailand they didn't.

It was only when I wired in my shower heater the fault was discovered.

[FruitPudding]

8 minutes ago, BritManToo said:

Not in Thailand they didn't.

It was only when I wired in my shower heater the fault was discovered.

Still doesn't change the fact that if the fuse is off, you wouldn't get a jolt (cos there is no power on live or neutral.......because the fuse is off......it is all dead).

[crazykopite]

If they changed the law and allowed foreigners to own up to 1 rai of land and house without the need of a company I believe property prices would be a lot higher but we all know that’s never going to happen it’s okay for Thais to buy almost anywhere in the world but when it comes to Foreigners buying in Thailand unless it’s a condo your out of luck ☹️☹️☹️

[zaZa9]

On 3/23/2019 at 9:26 PM, jackdd said:

Looking at the quality of buildings in Thailand, i would say after 30-40 years the value of the building is about zero, so the value depends on how much the price of the land increased

Agree ....now guess what part of a house and land a foreigner cant own ...

[Rod the Sod]

On 3/23/2019 at 3:48 PM, BritManToo said:

If you have no right to live in this country, there seems little point in buying property here for cash.

The housing market is irrelevant.

Ooops, forgot the investment side of the equation, didn't you...?

 

People do have a right to live here (it is called a visa), property in the right locations and future right locations will escalate IMHO and as for buying for cash - well hell, a good 0.1% from the Bank has to be a clear winner.

[Rod the Sod]

On 3/23/2019 at 7:56 PM, jackdd said:

Looking at the quality of buildings in Thailand, i would say after 30-40 years the value of the building is about zero, so the value depends on how much the price of the land increased

Mmmm and of course the value of a developer buying out the whole block to demolish and rebuiild. They do very very nicely with that in Singapore.

[khunPer]

On 3/23/2019 at 8:36 AM, FruitPudding said:

So, any ideas as to what the Thai property market is going to do over next decade? Up? Down? Flat?

Depending of where you "invest" – i.e. location – and what you invest in.

 

Some areas and price levels might be flat – could even decrease slightly in short term – whilst others still would at least double value (sales price) during each decade.

 

From a pure investor point of view, land is the key to gain in Thailand; whilst buildings needs proper maintenance, and might even decrease in value. Some Thais counts a 10% decrease per year for buildings – might not include the first few years of a new construction – i.e. after 10-15 years the value of the building is 30% to 50% of the original construction price, depending of inflation, and change in cost of building construction, and maintenance level. Within the same period the land value might have doubled, or more. So if building construction cost originally was twice as much as land price, it could be about even value after 10-15 years; more if location is right, and building are well taken care of.

 

Rental price, or rental return, are sometimes used as a value factor in Western countries, but might not work equally well in Thailand. Many Thais base a rental percentage on the building construction only, and do not include the value of the land, as they already own the land; i.e. could be family land, so not an "investment". 10% of the construction cost (only) are often used as annual rental value. That might well be the reason why it in some areas are cheaper to rent a home, than to "invest" in a home; i.e. buy land and build a house. In my Scandinavian home country investors count 8% to 12% of their investment as yearly pay back in rent.

 

I would think that farmland is still up for a double-up within a decade; and well located land plots, eventually with luxury construction(s), could also gain a double-up over ten years. Condo gain would be extremely dependent of location, but if in the right spot, which for example could be areas in Bangkok, they would also increase...????

[cryo]

The words Thai and Electrician should never be associated together. I've just fitted two basin mixer taps and two showers and my wife said I would not pass my Thai plumbing test, when I asked why she said no leaks ???? 

[Jaxxper]

We looked at a house in a province up north. My wife was told the price and we went to look. Was a good house with some maintenance issues, but Thb 500 k gets you a lot of remodelling / improvements done.As we were walking away my wife just wanted to confirm what the asking price was with the seller and he said, well yes, but I didn't realise you were married to a farang so I'm going to have to ask for another Million. On hearing this I told my wife to tell him what to do with his house. Needless to say we bought elsewhere.

[FruitPudding]

2 minutes ago, Jaxxper said:

We looked at a house in a province up north. My wife was told the price and we went to look. Was a good house with some maintenance issues, but Thb 500 k gets you a lot of remodelling / improvements done.As we were walking away my wife just wanted to confirm what the asking price was with the seller and he said, well yes, but I didn't realise you were married to a farang so I'm going to have to ask for another Million. On hearing this I told my wife to tell him what to do with his house. Needless to say we bought elsewhere.

Thainess at its best.

[newnative]

     If I am going to be anywhere for 10 years I'd be buying property rather than renting; saving 10 years of rent money out the window and having a place that is mine to enjoy and do with what I want, with my furnishings, art, etc.  That would apply to Thailand, as well, and my partner and I are condo owners in Pattaya and Bangkok. 

     A well-selected condo in a good location should at least hold its value.   And, it should not collapse in rubble after 30 years.  Our current condo is well-built and in tip-top shape after 30-some years.  No reason it won't remain standing indefinitely.  Except, small number of units on a rather large, rapidly increasing in value oceanfront lot equals possible redevelopment at some point.

    As for investment, my partner and I have decided that buying a condo to rent out is not worth our trouble--at least in Pattaya.  Just too much work that we don't particularly enjoy.  We've done better with condo flips and may do a few more of them.  

[Anythingleft?]

We looked at a house in a province up north. My wife was told the price and we went to look. Was a good house with some maintenance issues, but Thb 500 k gets you a lot of remodelling / improvements done.As we were walking away my wife just wanted to confirm what the asking price was with the seller and he said, well yes, but I didn't realise you were married to a farang so I'm going to have to ask for another Million. On hearing this I told my wife to tell him what to do with his house. Needless to say we bought elsewhere.

Thats quite a sad reflection of how they see foreigners
Not every foreigner is dripping in diamonds.....

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[FruitPudding]

1 hour ago, newnative said:

     If I am going to be anywhere for 10 years I'd be buying property rather than renting; saving 10 years of rent money out the window and having a place that is mine to enjoy and do with what I want, with my furnishings, art, etc.  That would apply to Thailand, as well, and my partner and I are condo owners in Pattaya and Bangkok. 

     A well-selected condo in a good location should at least hold its value.   And, it should not collapse in rubble after 30 years.  Our current condo is well-built and in tip-top shape after 30-some years.  No reason it won't remain standing indefinitely.  Except, small number of units on a rather large, rapidly increasing in value oceanfront lot equals possible redevelopment at some point.

    As for investment, my partner and I have decided that buying a condo to rent out is not worth our trouble--at least in Pattaya.  Just too much work that we don't particularly enjoy.  We've done better with condo flips and may do a few more of them.  

Interesting.

 

Any advice on selecting a condo?

[BTB1977]

Will go down like always.  Unless I'm in developer than I can tell you a 7% return yearly on anything I sell. 

[seajae]

wife owns a house and units, also have a 3 blocks of land all close together. The house has trebled in price since buying it  over 10 years ago and the units have doubled, land has also increased in value. Prices will either stagnate or go up, lots will depend on the direction the country takes with the new govt but there are  always good investments to be made