Where do you see inner city property prices heading in 5 - 10 yrs in regional cities

[ghworker2010]

I'm interested to know your thoughts on where you see prices for shop/ buildings in your average regional city. I realize that no one has a crystal ball and this is just a general discussion. The types of cities in Thailand I'm talking about are for example, Rayong or Ubon R, Khon K etc... NOT tourist hubs like Pattaya or Phuket. 

 

Factors determining capital gains on your average building/ shop frontage in an average thai city (outside of bkk) might include

- overall state of thai and global economy

- proximity of the said city to bkk?

- how affluent is the general population of the cities occupants. Would a poorer demographic in a city of Isan have slower capital increases in property values than more affluent city close to Bangkok?

- proximity / location of said building to cbd / popular shopping centers ie Robinsons 

- current physical condition of the said building. 

- How many levels in the building. In your typical thai city most are 4 to 5 levels in height max. 

- Is there parking for the customer?

 

I suppose what Im trying to find out from the average punter on this forum is what is your best guesstimate for what might happen to property prices (in general) in your city where you live for example. Do you see massive capital gains happening in the next 5 to 10 yrs? Or do you see prices holding where they are? 

 

Our landlord was bragging how she bought many properties so cheap 5 to 10yrs ago. We know she is not lying as we know a guy who bought one of her buildings for quite a high price. She took us to lunch recently bragging about this probably hoping we would make a stupid offer on the one we are renting from her. Needless to say I kept quiet as we have 9 yrs to go with really low month rent... 

 

Personally, Im trying to decide if we should buy a (different) 4 story inner city building (with assistance of bank loan), rent it out for 5 to 10 yrs (register the lease at the land office with the tenant) and sit on it for the same period. They would obviously pay the property tax and all utilities. We just pay back the mortgage slowly with the rent received.

 

With past experience of this back home I realize that one makes money on property when you purchase it (assuming you get it cheap and that prices generally go up over the long term). Its all a bit of a gamble to take but I have a solid marriage and successful business here.

 

Ive noticed in Thailand that, generally speaking, thai families who live in the inner city buildings and run their shop on the ground floor have been there for ages. They don't paint and renovate the exterior or interior. I drive around town where I live and there are so many ugly looking buildings with potential. Some are done up but most are run down. 

 

Maybe I should just do nothing. But still would like to hear your opinion on what direction you think prices might go in coming years.... north or south

 

[Pravda]

If you are not Chinese or Thai you should probably do nothing.

 

I believe prices will go up medium term, especially in major arteries like Bangkok. Everything else....????

[monkeycu]

Same place the properties will be " Underwater "

[Kwasaki]

3 hours ago, ghworker2010 said:

Maybe I should just do nothing. But still would like to hear your opinion on what direction you think prices might go in coming years.... north or south

Your choice as for prices depends where the property is and it's location whether it's in the north or the south.

Prices for property I have found usually go up in Thailand speaking from our local experience.

What amazes me is the crazy views of the Thai sellers and buyers, recently a lady bought a garage type terraced property no upstairs 8m deep x 3.1/5 wide 28 m2 with a small pedestrian entrance at back, it was a motorbike repair shop, she paid 2,200,000 baht, it's located in high street of the village.

 

2 kilos on the same main road out from the village we have 3 studio apartments, a tenant who made his one into a shop asked if he could buy it.

Front to back It's 100 m2 the living area is 52 m2 including bathroom.

 

We had sold some land next door at recommended low price per Wah to be able to sell it asap, so we had an idea of the areas land price. 

 

The tenant offered 200,000 baht, the land was worth 90,000 and apartment had cost us nigh on 400.000 to build, so smiles all around. 

 

 

[CharlieH]

More suited to REAL ESTATE forum

 

MOVED

[baansgr]

A rerun.of 1997, Thais are in debt up to their eyeballs, one simple shake, the whole house of cards will collapse. Theyve had a good run but the game is almost over.

[kingstonkid]

GH  it is not in the cities that you should look. to me, those prices will always be overinflated and will not rise that much the market is over saturated.  The housing market in the BKK area is the outside areas like Pathum Thani.

 

I imagine that Pattaya is the same.  if you are buying to invest these are the areas the cost are cheaper and the demographic is like most western cities ow to move outside the city and commute

 

example gf renting a 1 bedroom flat for 3500 in BKK I am renting a 3 bedroom garden home for 5000.  

 

The real joke is that it takes her longer to get to work from her apartment than it does from my house.

 

[wolf81]

With regards to Pattaya, I feel prices must come down in the coming years. From what I read many condos are of crappy quality with few exceptions. And in the past when looking for a decent but affordable condo to stay with my girlfriend, I visited many run-down condos that I was determined I wouldn't want to stay in. I feel many luxury condos might quickly detoriate as well in the coming years.

 

When buying a condo, it's probably wiser to buy an older one that seems to be well maintained, instead of a new one that looks good now. 

 

I also feel that there's too many new projects going on, while many condos probably aren't half full (perhaps the rooms are all bought, but perhaps there are <50% of tenants at any time). I find that worrisome. 

 

I should note I intend to buy a condo in Pattaya in the future as well, so perhaps in part the above is wishful thinking. Currently I don't have the money for it anyway, but perhaps in 2 years. But yeah, as someone else mentioned, Thai people are greatly in debt and they might want to sell some property to pay off debts in a new crisis.

[robertson468]

It has been reported in the Thai Press that there is a surplus of property in Bangkok and developers are having to dump some of them to be able to move on to future developments.  If that is the case, the properties that have been reduced in price will complete with those of "normal price" which could create a domino effect on prices, plus the Government is toying with introducing additional safe guards on mortgages, which no doubt will adversely affect the market.

[bkk6060]

1 hour ago, wolf81 said:

With regards to Pattaya, I feel prices must come down in the coming years. From what I read many condos are of crappy quality with few exceptions. And in the past when looking for a decent but affordable condo to stay with my girlfriend, I visited many run-down condos that I was determined I wouldn't want to stay in. I feel many luxury condos might quickly detoriate as well in the coming years.

 

When buying a condo, it's probably wiser to buy an older one that seems to be well maintained, instead of a new one that looks good now. 

 

I also feel that there's too many new projects going on, while many condos probably aren't half full (perhaps the rooms are all bought, but perhaps there are <50% of tenants at any time). I find that worrisome. 

 

I should note I intend to buy a condo in Pattaya in the future as well, so perhaps in part the above is wishful thinking. Currently I don't have the money for it anyway, but perhaps in 2 years. But yeah, as someone else mentioned, Thai people are greatly in debt and they might want to sell some property to pay off debts in a new crisis.

12,000 properties for sale in Pattaya area.

And, the number keeps rising as stubborn sellers do not want to lose money.

Rents in many areas of Pattaya have actually gone down.

I would rent and put you money into a true investment.

Real Estate in Pattaya is a non transparent dead money mess.

[bkk6060]

3 hours ago, kingstonkid said:

GH  it is not in the cities that you should look. to me, those prices will always be overinflated and will not rise that much the market is over saturated.  The housing market in the BKK area is the outside areas like Pathum Thani.

 

I imagine that Pattaya is the same.  if you are buying to invest these are the areas the cost are cheaper and the demographic is like most western cities ow to move outside the city and commute

 

example gf renting a 1 bedroom flat for 3500 in BKK I am renting a 3 bedroom garden home for 5000.  

 

The real joke is that it takes her longer to get to work from her apartment than it does from my house.

 

Thais have strange thinking on this.

They would rather commute 2 hours to save a few thousand b on their rent.  Rather then live closer to work.

No consideration on the cost of transportation, time, stress, etc.

[DJ54]

The market seems to be flat in NE. A lot of empty commercials units in Kumphawapi. But you don’t see many Fot Sale signs.

 

Yesterday 2 floor commercial unit. Open floor area with kitchen type area. Upstairs 2 bedrooms and bathroom. Rent 4500 baht.

8 units with 2 Occupied.

[Delight]

 If all house prices increase -then that is inflation. Definition of  the cause of inflation:

'An expansion of money which represents an expansion of wealth -that does not exist'.

 One perfect of example of this is the UK

The banks entered the UK market in about 1972.

The money supply expanded -the  supply of  available properties  did not -So prices inflated.

There have been periods in the UK when deflation occurred-but in the main inflation has been the norm.

It seems to me that Thai banks do not flood the market with money.

The money supply comes from outside Thailand.

So is this external supply  of money contracting or expanding.

I have no idea about Bangkok.

If it is then prices will rise -and, in this country , so will supply.

For certain in Pattaya it is contracting -in a serious way.

Either way I cannot see any serious real estate price  inflation.

Better to invest somewhere else.