Chinese continue to soak up Thailand’s condo glut

[kwonitoy]

16 hours ago, soi3eddie said:

My Bangkok condo was on sale in 2017 for 4 months during my divorce. During that time there were interested buyers. Both were rejected for finance by banks so nould not proceed. Many new projects are financed by banks who then offer more lenient funding to buyers. I think that if buyers don't have credit worthiness to buy new units then they definitely will not qualify for resale purchases and are almost certainly not going to be cash buyers.

 

How many on here have resold condos and how well did you do with pricing and ease of sale? 

 

In the end I purchased ex's share of my condo at a very reduced price. 

I just sold my condo in Jomtien, 

3 years of being listed, started at 15M baht and finally sold for 12.5M baht

Ease of sale, please, it was slower than water torture. At those prices there is a VERY limited market of foreigners that have the cash on hand. Lots of tire kickers.

One gent interested 2 years ago, went home to arrange the money and his kids talked him out of it, saw there inheritance flying away perhaps.

At the price I sold I did make a good profit, about 20% to the upside, was an original off plan buyer, but most of the money gain comes from currency changes.

I am firmly in the rent don't buy crowd now.

Easy to buy, absolute horror show to sell, and I did have a great sales agent/company. Hats off to them

[Pilotman]

2 minutes ago, kwonitoy said:

I just sold my condo in Jomtien, 

3 years of being listed, started at 15M baht and finally sold for 12.5M baht

Ease of sale, please, it was slower than water torture. At those prices there is a VERY limited market of foreigners that have the cash on hand. Lots of tire kickers.

One gent interested 2 years ago, went home to arrange the money and his kids talked him out of it, saw there inheritance flying away perhaps.

At the price I sold I did make a good profit, about 20% to the upside, was an original off plan buyer, but most of the money gain comes from currency changes.

I am firmly in the rent don't buy crowd now.

Easy to buy, absolute horror show to sell, and I did have a great sales agent/company. Hats off to them

15 million for a condo, in Jomtein? Bangkok maybe, at a stretch, but Jomtein?  I wouldn't even pay that for a big house, pool and land. It must be a wonderous place.  No wonder you had some difficulty selling it.  

[madmen]

9 minutes ago, kwonitoy said:

I just sold my condo in Jomtien, 

3 years of being listed, started at 15M baht and finally sold for 12.5M baht

Ease of sale, please, it was slower than water torture. At those prices there is a VERY limited market of foreigners that have the cash on hand. Lots of tire kickers.

One gent interested 2 years ago, went home to arrange the money and his kids talked him out of it, saw there inheritance flying away perhaps.

At the price I sold I did make a good profit, about 20% to the upside, was an original off plan buyer, but most of the money gain comes from currency changes.

I am firmly in the rent don't buy crowd now.

Easy to buy, absolute horror show to sell, and I did have a great sales agent/company. Hats off to them

People buy in Jomtien because its cheap its a little backwater that doesn't even have a shopping center. The % of buyers at 15m would be infinately small. bangkok no problem but Jomtien. taking 2 years has nothing to do with the market and everything to do with your exposure

[CGW]

12 hours ago, lonewolf99 said:

The question I have is - Why do governments like Australia and the U.K. allow people from a foreign country to break the law to obtain illegal funds to invest in Oz and the U.K. ? I can understand Thailand where money is number one and don't give a hoot where it comes from.

Answer to your question - because they can! until people realise the blind faith they have given their elected officials is misplaced, it will continue.

The London property boom, its no secret this was built on the back of "corrupt" Russian money, money appears to be #1 to ALL governments from my observations.

We live in a society that imprisons people who tell us our governments are criminal liars, sadly most are so brainwashed they agree 

[kwonitoy]

16 minutes ago, Pilotman said:

15 million for a condo, in Jomtein? Bangkok maybe, at a stretch, but Jomtein?  I wouldn't even pay that for a big house, pool and land. It must be a wonderous place.  No wonder you had some difficulty selling it.  

It is a very nice place and the difficulty selling it is down to the number of people with that much free cash.

Same building has a good turnover of units in the 3-5 M range,

And sell it I did, for a profit, willing to wait, it cost me nothing to do so.

[tjo o tjim]

I get it that it isn’t the worst possible investment— it keeps value relative to inflation if nothing else, and as much as you manage to rent a place out it can be a not-terrible investment.

 

But... If I have to compare paying $500-1,000USD for 40-50m^2 in a building that is reasonably well maintained (but far from perfect), to buying outright for ฿5-6 million, I would rent any day.  The main issues are the building never lives up to expectations as maintenance costs come in, and the construction quality just adds risk.  Looking at the number of spalling and leakage issues after only 3-5 years, it is hard to see it as a 10 year investment.

 

That isn’t to say you can’t make money on it... just that there are a lot easier ways to make money IMO.

[newnative]

10 minutes ago, kwonitoy said:

I just sold my condo in Jomtien, 

3 years of being listed, started at 15M baht and finally sold for 12.5M baht

Ease of sale, please, it was slower than water torture. At those prices there is a VERY limited market of foreigners that have the cash on hand. Lots of tire kickers.

One gent interested 2 years ago, went home to arrange the money and his kids talked him out of it, saw there inheritance flying away perhaps.

At the price I sold I did make a good profit, about 20% to the upside, was an original off plan buyer, but most of the money gain comes from currency changes.

I am firmly in the rent don't buy crowd now.

Easy to buy, absolute horror show to sell, and I did have a great sales agent/company. Hats off to them

     From your posting it sounds like you listed your condo with just one agency.  If that was the case, you might have sold it sooner had you listed with all the big agencies in town, and any others you knew of, as well.  Thailand has no MLS (multiple listing service) so the other agencies might not have known your condo was for sale--or have photos and information on it at hand.

     We always list with every agency we know of on the theory that the more agents that know our condo is for sale, the better.  Nobody knows what buyer will walk into what realty office with a 15 million budget wanting a Jomtien condo.  On the plus side, your condo did sell, you made some money, and you had the enjoyment of what must be a very nice condo to live in while you owned it.   Not a bad deal--and we can put you in the column of those who bought a condo in Thailand and did not lose their shirt.

[petedk]

I just drove past an older, but luxury condo building just off Rama 9 and a bus pulled up opposite.

There must have been 30 or 40 Chinese people get out. One guy stopped the traffic and they all marched across the road into the condo building.

The taxi driver said something about Chinese being rich and buying everything.

I said they were probably Airbnb guests but he didn't really know what I was talking about, so I said that they rent the rooms for a few days. He agreed and said Ratchada and Rama 9 was full of Chinese.

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[kwonitoy]

I did list it with multiple agencies, and most of them were beyond useless.

One who I dealt with before and has very good rating from people showed it to exactly nobody in 18 months

Yes I'm happy to be in that small group who made money and got it out to my home country.????

[petedk]

I know this thread is about condo glut and Chinese buyers, but I know of several Chinese (and Koreans) who rent houses and then rent the rooms out, putting 5 or 6 people in each room.
Our neighbour (a Korean) did that but someone reported him to immigration and he was forced to move.

Now there are 2 houses opposite for rent at 220,000 baht per month each. Two days ago about 20 Chines people parked their cars in front of our gate and blocked our exit. It seems a Chinese person has rented the house and now renting out to Chinese.

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[newnative]

5 minutes ago, kwonitoy said:

I did list it with multiple agencies, and most of them were beyond useless.

One who I dealt with before and has very good rating from people showed it to exactly nobody in 18 months

Yes I'm happy to be in that small group who made money and got it out to my home country.????

     Some agencies are better than others, no doubt about that.  But, we still list with as many as we can, for the reasons stated before.  Perhaps the agent you mentioned didn't bring anybody for 18 months because he had nobody to bring with a 12 to 15MB budget.  I'd rather have that than, in your case, have an agent bring over a client with a 7MB budget that's just wasting your time.

[kinyara]

As a Brit who bought a condo in Jomtien 14 years ago at an an average of 70 baht to the £ I certainly have no regrets about buying rather than renting, proved to be a very good currency hedge. In a time of historically low interest rates on savings I had 70% back through rent in the few years I wasn’t permanently living here. It’s a well run mid priced low rise development with high owner occupier rate and the nearby facilities have improved over the years as has the management and maintenance of the development.

 

We have no Chinese residents or renters and with all the new high rise units on Jomtien 2nd Road I’m pretty sure that situation will remain unchanged. I’ll eventually sell and rent downsize in later years when I want to free up the cash. Units seem to sell relatively easily because it’s a nice place to live.

 

I don’t see decision making in the Thai property market be it buying or renting as particularly different from any other to be honest. Location, facilities, transport links, building quality & maintenance, owner occupier/renter breakdown. Same rules apply.

[Traubert]

14 hours ago, lonewolf99 said:

If anyone cares to read the attached link - you will understand that that Chinese Gov do not want any money going abroad. - hence any property investment abroad above the value of 50,000 U.S. is basically illegal.

So how much of a Condo does that buy you in Bangkok ? A small studio at most.

 

The article clearly states that the Chinese person has lied to get the money out to buy in Bangkok. If there is one government not to mess with it is the Chinese one. They don't seem to bother with jails and just use bullets instead. So how many more Chinese will be willing to break the law to buy thousands of condos in Thailand....?

 

The question I have is - Why do governments like Australia and the U.K. allow people from a foreign country to break the law to obtain illegal funds to invest in Oz and the U.K. ? I can understand Thailand where money is number one and don't give a hoot where it comes from.

 

https://www.scmp.com/week-asia/society/article/2095827/why-are-middle-class-chinese-moving-their-money-abroad

Well actually that's not the case. Conversion of Chinese currency to a foreign currency to the value of $50k equivalent per annum per person is allowed without any scrutiny. If a Chinese wants to convert more there's a process to apply for approval. Very likely a foreign property purchase would be approved as long as the applicant and none of his/her relatives are Government employees.

 

However, note that that is per person and also remember that Chinese families, like a lot of Asian families have a family pot not a personal one. Four grandparents, two parents and kid can convert $350k without anybody batting an eyelid. That's Bht11m.

 

That's the official way to do it. Carry the cash out of the country and convert it outside and no-one is any wiser.

 

This $50k thing came out of Xi Jingping's anti-corruption campaign. It's the equivalent of 325k CNY, which they reckon is the maximum you can fit in a suitcase. I.e. they don't care about $50k at a time disappearing out of the country.

[Rod the Sod]

11 hours ago, ThomasThBKK said:

 

Yeez, thats not money laundering. It's capital flight. Same Thais do, every rich thai has his money in singapore and co and not in thailand. If my homecountry wouldnt let me transfer my money out how i want on my own terms i would do absolutely the same and bring it to a saner country. They don't care if it's a good investment, it's just a hedge against china failing.

 

it's just that no one told the chinese that their money will be stuck in here too -.-

it's just that no one told the chinese that their money will be stuck in here too -.-

 

Why......?

 

What makes you say that?

 

Sell and move your money out - no restrictions.

[ThomasThBKK]

9 minutes ago, Rod the Sod said:

it's just that no one told the chinese that their money will be stuck in here too -.-

 

Why......?

 

What makes you say that?

 

Sell and move your money out - no restrictions.

 

1) To legally own a condo u need to provide certain paperwork which most of these don't as they need to send it abroad with a wire tx subject of "FROM OWNERNAME TO BUY CONDO AT ADDRESS IN BANGKOK BLA" or equivalent. Then u have to provide proof of all this and your thai bank needs to sign off on it.

You can read more about that here:

 

 

They use multiple tricks to ge their money out of that hole, but none is in compliance with the condo ownership laws in thailand.

 

2) Let's say your condo ownership is waterproof - all perfect - all good paperwork.

  You can only transfer the same amount out that you brought in. Not the "profit". Thailand does have capital controls, and i don't think they get looser, they will get more tight.

 

 

 

While i do have property here, i would never invest my life savings in this market. It's all for fun and pleasure and i am ready to walk away from it if needed...

 

 

 

 

 

[champers]

19 hours ago, newnative said:

    Actually Smedly is correct.  It's the new condo projects in Pattaya that are attracting most of the illegal short-term renters.  Think The Base, Unixx, Centric Sea, the Rivieras, etc.  And all  those 'theme park' low-rise condos too numerous to mention.  All large projects with around 1000 rooms. To make any kind of decent profit, you need to rent out 10 or more units in a building.  How many 1 room hotels do you know of?  In order to get 10 or more rooms, you need a new building--hard to acquire that many units in an old building where the units have already been sold.  I know of one newer condo project in Pattaya that sold at least 30 units to one owner--obviously he is running his own illegal boutique hotel within the condo.

And the agent's commission is too much to turn down.

[Sonhia]

Nothing is guaranteed in a place like Thailand, but instability is. 

 

Invest in either a business or condo... No way!  

 

 

 

 

 

 

[johng]

I know this thread is about condo glut and Chinese buyers, but I know of several Chinese (and Koreans) who rent houses and then rent the rooms out, putting 5 or 6 people in each room.
Our neighbour (a Korean) did that but someone reported him to immigration and he was forced to move.

Now there are 2 houses opposite for rent at 220,000 baht per month each. Two days ago about 20 Chines people parked their cars in front of our gate and blocked our exit. It seems a Chinese person has rented the house and now renting out to Chinese.

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Well go report them to immigration ! [emoji39]

[Bang Bang]

To my calculations the math says renting beats owning in Bkk at least, though I've no insight into the recent Chinese impact on the market.

 

E.g, my own unit which I rent for 20K/mth is 65 sqm. 2 bed/bath with a large balcony on the 17th fl. 5mins. walk from the VM  BTS. It's an older building but well kept up.

 

Units in this building are for rent only but I am guessing mine could sell for at least 6mil. Heck, one time I went out looking thinking to buy I saw 1 bed pigeonholes opening one after another from an endless dark hall in a giant structure near Saphan Khwai, each selling for 8-9 mil. The sight of a plastic bathtub in one of their bathrooms had me scampering home never to leave again.

 

Ok, so 20k/mth = 240k/year = 4% of 6mil, not counting condo fees. Heck, the S&P 500 yields an average of 7% per annum inflation adjusted if you just put your money in an index fund and let it be, which is what I do.

 

So, without appreciation I don't see the point buying. As for appreciation of a condo it's a bit of the luck of the draw isn't it? How hot the locality is/becomes, how well the building holds up, the economy, ...?

 

I'll stay with renting.

[petedk]

Well go report them to immigration ! [emoji39]

No.

I will leave it to the Thai neighbours.

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[johng]

No.

I will leave it to the Thai neighbours.

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"Uuurrp to you"

[wreckingcountry]

And many of these Chinese owners have no legal visa status in Thailand! Just tourist ! Many don’t have Thai bank accounts ! Many are scammers who cheat anyone stupid to rent from them ! Remember many of these Chinese are always searching various ways to get around Chinese Gov Exchange controls so they can buy in Thailand! And Thailand doesn’t give a rats ass about where the money comes from when all this yuan changed into Baht buys up the Condos no one else wants to, or don’t have the money to buy

 

 

Sent from my iPhone using Thaivisa Connect

 

 

[Jack100]

Sold a flat in  the " red hot " West London property 3 years ago , it was never more than a week on the market before some kind of offer was made , though the first offer fell through ( chain )  it quickly   sold near to the price I wanted.

 

Compared with Pattaya , it was heaven , I listed with several agents and sat back ...and back for well over a year without even getting an offer. Also you need patience to cope with the ever so short high season and the ever so long low season .

 

Eventually it sold but most of the profit was in the  strength of the Thai baht rather than the condo .

 

 

 

[zaZa9]

On 5/3/2019 at 12:49 PM, madmen said:

Slow my ASS !!! Lower sukhumvit prices jumping in multiples 

Q Sukhumvit  @ nana bts   https://www.qcondosukhumvit.com/project     selling $1 to $5 million USA dollars...in a red light district!  All new developments are out of the reach of poor expats so now its the rich Chinese taking them out.

 

By the way I agree with you. Everybody should rent it certainly helps create wealth for us landlords ????

 

Had me believing you till the last sentence ..

[gunderhill]

On 5/3/2019 at 2:08 PM, Traubert said:

As a lot of people have learned, buying to rent in Thai condos is a dead market

Depends when you  bought, where you bought and at what exchange rate  you  bought at if  bringing money over and  finally  what you  paid for it Did  most of my deals at 72  baht to the pound. I got some very good  deals a  few  years back but  by this time I was earning in Thailand so exchange rates werent as  important, wouldn't buy anything now ,way overpriced.

[gunderhill]

35 minutes ago, wreckingcountry said:

And many of these Chinese owners have no legal visa status in Thailand! Just tourist ! Many don’t have Thai bank accounts ! Many are scammers who cheat anyone stupid to rent from them ! Remember many of these Chinese are always searching various ways to get around Chinese Gov Exchange controls so they can buy in Thailand! And Thailand doesn’t give a rats ass about where the money comes from when all this yuan changed into Baht buys up the Condos no one else wants to, or don’t have the money to buy

 

 

Sent from my iPhone using Thaivisa Connect

 

 

Some even refuse to pay an agents  commission after they have found them a  customer to rent the room too.

[zaZa9]

27 minutes ago, Jack100 said:

Sold a flat in  the " red hot " West London property 3 years ago , it was never more than a week on the market before some kind of offer was made , though the first offer fell through ( chain )  it quickly   sold near to the price I wanted.

 

Compared with Pattaya , it was heaven , I listed with several agents and sat back ...and back for well over a year without even getting an offer. Also you need patience to cope with the ever so short high season and the ever so long low season .

 

Eventually it sold but most of the profit was in the  strength of the Thai baht rather than the condo .

Good ta see honesty rather than ego ...

 

I can point out 5 homes near me in Hkt that have been for sale for well more than a year ..

27 minutes ago, Jack100 said:

 

 

 

[Traubert]

46 minutes ago, wreckingcountry said:

And many of these Chinese owners have no legal visa status in Thailand! Just tourist ! Many don’t have Thai bank accounts ! Many are scammers who cheat anyone stupid to rent from them ! Remember many of these Chinese are always searching various ways to get around Chinese Gov Exchange controls so they can buy in Thailand! And Thailand doesn’t give a rats ass about where the money comes from when all this yuan changed into Baht buys up the Condos no one else wants to, or don’t have the money to buy

 

 

Sent from my iPhone using Thaivisa Connect

 

 

Anyone spending eight figures on a property isn't going to care much about 500k for an Elite visa.

 

I've already explained the Chinese Exchange controls and how the money comes in and out of Thailand.  Also you might have seen Unionpay signs on all the ATM's.

 

Now wipe the froth from your mouth and stop hyperventilating.

[wisperone]

1 hour ago, wreckingcountry said:

And many of these Chinese owners have no legal visa status in Thailand! Just tourist ! Many don’t have Thai bank accounts ! Many are scammers who cheat anyone stupid to rent from them ! Remember many of these Chinese are always searching various ways to get around Chinese Gov Exchange controls so they can buy in Thailand! And Thailand doesn’t give a rats ass about where the money comes from when all this yuan changed into Baht buys up the Condos no one else wants to, or don’t have the money to buy

 

 

Sent from my iPhone using Thaivisa Connect

 

 

Don't worry..when there are enough Chinese there, China will force Thailand to offer them permanent residence. China can shut off the flow of Chinese and their money to Thailand on a whim.  Thailand is digging themselves in a hole, they will have no option but to bend over to their Chinese master.

[Rod the Sod]

3 hours ago, Bang Bang said:

To my calculations the math says renting beats owning in Bkk at least, though I've no insight into the recent Chinese impact on the market.

 

E.g, my own unit which I rent for 20K/mth is 65 sqm. 2 bed/bath with a large balcony on the 17th fl. 5mins. walk from the VM  BTS. It's an older building but well kept up.

 

Units in this building are for rent only but I am guessing mine could sell for at least 6mil. Heck, one time I went out looking thinking to buy I saw 1 bed pigeonholes opening one after another from an endless dark hall in a giant structure near Saphan Khwai, each selling for 8-9 mil. The sight of a plastic bathtub in one of their bathrooms had me scampering home never to leave again.

 

Ok, so 20k/mth = 240k/year = 4% of 6mil, not counting condo fees. Heck, the S&P 500 yields an average of 7% per annum inflation adjusted if you just put your money in an index fund and let it be, which is what I do.

 

So, without appreciation I don't see the point buying. As for appreciation of a condo it's a bit of the luck of the draw isn't it? How hot the locality is/becomes, how well the building holds up, the economy, ...?

 

I'll stay with renting.

Hi Bang Bang, let's use your unlikely 7% scenario (which you probably wont get in truth, and is that before or after tax?) and compare to my real live experience in BKK. Let's take a 5 year investment timeline and assume we both have £200k.

 

For you, without counting inflation over 5 years you will pay TB1.2million in rent which is around £28.5k at today's rate. You do however get this 7% growth and without deducting the rent each year to make it easy you get £14k per year over 5 years = £70k. Your net position at the end of 5 years is £241.5k. Well done....

 

I converted my £200k in TB and bought a condo when the rate was around 50 to £1. I therefore spent all my £200k on my condo which cost TB10.5m and is the same size as yours, 200m from Nana BTS in a quiet Soi with one old pub 175m away (so no noise at all at home from the outside world). I have to pay £1k per annum for Management Fees which you do not, so we will deduct £5k at the end. I sell in May 2019 at a current SqMtr price for less attractive units in less attractive areas of Lower Suk and get TB12.825mio (so in truth may get another £1m). I now repatriate this in sterling at todays rate and send home £305,400. Let's not forget the $5k so for sake of ease let's call it £300k. I have no tax to pay on any gain.

 

I outdid you by £58.5k or even a lot more if you pay tax. That should buy me a new Range Rover Evoke or some other nice fat car, thank you very much.

 

Slightly more respectfully, it worked for me, and you are dead right that your calculation doesn't allow for appreciation/FX etc and there are associated risks when assessing property as an investment. I agree that there is risk in both property price, attractiveness in the market and FX. If you have only one chance to buy I probably, almost certainly wouldn't take these risks. If you invest in property and have a balanced portfolio, you simply would be mad not to consider this type of investment, offsetting the risk against "safer" property investments elsewhere.

 

Problem here is that too many people with little or no experience state most categorically that you would be mad to invest in Thailand, which only exposes their own lack of knowledge in property investment (not aimed at you BB and I respect your choice).

 

I just want to give another view. Different decisions depending if this is your "Forever Home" or "Only Property Investment", or part of an investment strategy/portfolio.

 

RtS