How Are Property Prices Holding Up

[GuestHouse]

My wife is considering buying a place to rent out near Pattaya, it will be in her name from rental income she makes elsewhere in Thailand.

Before deciding we'd like to know how are property prices are holding up around Pattaya, has the enforcement of laws preventing foreign ownership having and effect?

The only feedback we have is a Farang friend has recently built a new house but seems unable to sell his old house (or perhaps not at the price he would like).

If that is repeated across the region then perhaps there are some bargains to be had.

Any feedback?

[cclub75]

The market is healthy.

Just peruse the daily news.

For instance, today :

http://www.bangkokpost.com/topstories/tops...s.php?id=117610

The Finance Ministry is reviewing new stimulus measures to lift economic growth and consumer spending which has slowed, with sales of cars and consumer durables such as housing all down from last year.

"We might also need to look at measures to help the property market as well," he said.

You see !

I should add, regarding your situation : it's rather difficult to say that there is a shortage of places to rent in Pattaya...

Edited March 23, 2007 by cclub75

[GuestHouse]

Yes I've seen the news reports but I'm ever mindfull of the fact that sponsors have a big say in reporting.

As for renting, my wife rents three properties directly to foreigners who work for international companies we have contacts in, a reasonable rent and the right fee in the right hand to get things started. Its worked well so far.

[buriramboy]

makes me laugh when people say the market is doing well, i was having a drink with an estate agent last night and he was saying he has not sold a single house since January, only a few condos and he knows of at least 4 estate agents that have closed down here in Pattaya since the start of the year.

BB

Edited March 23, 2007 by buriramboy

[billaaa777]

makes me laugh when people say the market is doing well, i was having a drink with an estate agent last night and he was saying he has not sold a single house since January, only a few condos and he knows of at least 4 estate agents that have closed down here in Pattaya since the start of the year.

Your so full of crap!!! What were the names of the four officies that closed down? Because there are at least 5 that have opened. As soon as you start talking about real estate clowns like this come out of the closet and start posting BS they don't have a clue on. Before you respond with more of your BS, name the places that closed down? Clown!!!

[GuestHouse]

^

What I was hoping for was some feedback on personal experience and indeed annecdote is welcome too.

I hadn't specifically said I didn't want to hear people abusing other respondants, to be truthfull, I hadn't really expected it.

Thanks for taking time to give your input BB, it is an important part of the general picture.

[buriramboy]

makes me laugh when people say the market is doing well, i was having a drink with an estate agent last night and he was saying he has not sold a single house since January, only a few condos and he knows of at least 4 estate agents that have closed down here in Pattaya since the start of the year.

Your so full of crap!!! What were the names of the four officies that closed down? Because there are at least 5 that have opened. As soon as you start talking about real estate clowns like this come out of the closet and start posting BS they don't have a clue on. Before you respond with more of your BS, name the places that closed down? Clown!!!

could have guessed you have a vested interest in the market, its normally only developers like yourself and estate agents who try and make out everything is going ok with the property market. It was just refreshing to speak to an honest estate agent last night who tells the truth and next time i speak to him i will get the names of the places that have closed.

[twix38]

I am trying to sell a condo in foreign name and on the market for 2 months. Price dropped 3 times and it's a nice unit below market price.

Estate agents tell me there are very few customers. Very quiet.

Anyone who says the market is ok is a liar or uninformed. Generally the market is slow, quiet and unless it improves prices will drop. There is over supply and people are uncertain and holding off investments generally. As for houses, I and many others don't want to buy them and sellers just can't find a mug silly enough in the current political and economic situation, at least until things become clearer.

Billaaa777,

What a crock of 5hit. I have spoken to 4 or 5 estate agents just this week who ALL said it's DEAD! Really what planet are you on, cause it ain't planet Pattaya!!!!!!

Edited March 23, 2007 by twix38

[Temporaneo]

My impression as simple "sexpat" here in Pattaya not personally involved in real estate market is that prices shown in agency's windows are always the same, but I wonder if properties for sale still get sold. There are a lot of new developments going on, and I think that in a few months some developers will be in need to sell urgently and the market will turn seriously downwards. After all Thai authorities had so fun in kicking farang asses recently that only a true masochist could be willing to reward them putting out his cash to invest here.Better wait and see.

Edited March 23, 2007 by Temporaneo

[bingobongo]

here are some numbers, it will be worse for 2006-2007 YOY conmparisons given the coup/bombings/capital controls/rising baht/insurgency in south/general global slowdown

Edited March 23, 2007 by bingobongo

[bingobongo]

here are some more numbers......without the emotion

that is a pretty expensive haircut in percentage terms.......

The average selling price last year also dipped to 2.59 million baht a unit, compared to 3.08 and 3.73 million baht in 2005 and 2004 respectively.

http://thailand-property-guide.com/?p=news...&NewsID=300

[bingobongo]

here is one more from me.....last one (until next week) from me

Monday March 12, 2007 REAL ESTATE MARKET OUTLOOK AND NEW DEVELOPMENTS

Supply glut starting to put pressure on prices

NINA SUEBSUKCHAROEN

The central Bangkok property market is facing difficult times as supply outstrips demand that, making people think more carefully before deciding on purchases, says Ian Soo, the managing director of Hamptons property.

While the political situation continues to cast a cloud over the landscape, Mr Soo does not see this to be a huge factor, saying simple market forces are the key issue.

''There is a huge amount of stock on the market at the moment, both in the sale and rental markets, so buyers or tenants do have more choice and ultimately whatever they take, it's going to come down to value for money and pricing,'' he said.

''There are still good deals to be had, make no mistake, but you just have to be more careful where you look for them.''

Hamptons has sold a few good units so far this year but at least half have been sold at below cost, even in good projects.

''I think this is an indication that people who are speculating without any intention to take ownership, and they can't sell at profit, they are basically having to sell at cost or maybe below cost to be able to get out of the transaction.''

Mr Soo said the market had to accept the fact that supply has been increasing, with thousands of new units completed or going to be completed in a year or two.

Developers and buyers, he said, took a different view two years ago when many of the projects now nearing completion were first announced. Pent-up demand at the time seemed strong. ''Now all this stuff is actually coming on the market in one go, and then you suddenly need thousands more tenants, thousands more buyers to take up this demand.''

For this reason, he is convinced that the market direction is either flat or down. ''I don't believe anyone can say it's still going up. If they do, ask them how they justify that comment.''

Obviously prices will come under pressure. An example he cites is a two-bedroom unit at the upscale condo The Lakes, with around 100 to 110 square metres. A year ago the firm could have rented it out for 70,000 baht a month but today the owner can get only 60,000 to 65,000 baht.

In a buyer's market, landlords cannot set rental rates based on what they got last year or the year before but must accept what the market rate really is.

''And it's the same for sales,'' says Mr Soo. ''They can't bear to think they'll get less than before. It's the same with stocks: if you buy a stock for 100 baht, it goes down to 80 and it might fall further. You can't hold on but you want to sell it at over a hundred. So if it goes down to 50, what do you do? People have to be realistic about pricing, basically, if you're a seller or a landlord.''

On the positive side, the current conditions are good for those who have not yet bought a unit to live in. ''There are still some really good deals to be had and some of the units that we have been asked to sell we have sold within a few days _ it never reached the market.''

Mr Soo urges the authorities to consider reintroducing the tax breaks that ended in 2002 to spur the market. The revival of the property transfer fee cut to 0.01% would be a start. ''That's the most obvious way to help things move along better.''

While there are worrying signals that the US housing market is slowing, Mr Soo does not buy into notions of a global real estate slowdown, given the wide variations from country to country and region to region. He notes that a lot of buyers dealing with his company are from England and the UK market is still very strong.

On the other hand, the property market is linked to any market from which people derive income, so the health of stock markets, retailing and consumer confidence and spending all bear watching.

Mr Soo advises those shopping around for a good condominium unit that it's not necessary to wait until the year-end or for interest rates to fall further to get a good deal, because it's not a question of time but more about what is available.

''At the moment I have five to six properties that we are expecting to sell quickly and if those properties match your requirements you shouldn't wait, otherwise you might wait six months and the property might not be on the market.

''It's about what is a good deal at the moment. If there are good deals to be had, then fine. If not, then you can wait longer but don't wait if there's something good on the market.''

On the other hand, sellers should not be swayed by prices advertised in newspapers because often these are not what the advertised properties are sold at.

Mr Soo has noted that a tendency among his clients to seek newer buildings if they are well maintained and have good facilities. However, older buyers who are coming to Thailand to retire do not mind older buildings because they sometimes offer more privacy, being located farther into sois. and units generally are bigger.

http://www.bangkokpost.com/Yourmoney/12Mar2007_money47.php

Edited March 23, 2007 by bingobongo

[think_too_mut]

We have seen many quotes and articles from the property ranks.

One thing the bulls and the bears have in common is - they all bullshit about property "market" in Thailand.

Some say - great, going up, while others are trying to steel any crumbs they could - if there is anything for anyone in that biz to get.

They are all drowning with tens of thousands of unsold and unwanted properties. It's only Thai's mindset that does not want to meet the market and that makes the poor sods survive...not for long, at least, not without any sales.

Now, back to the byers quarters.

[billaaa777]

What a crock of 5hit. I have spoken to 4 or 5 estate agents just this week who ALL said it's DEAD! Really what planet are you on, cause it ain't planet Pattaya!!!!!!

I have sold 4 condos since January and bought 4 to replace them. But I only did 20 last year, so what do I know. You pay to much, do a bad job of renovating and price it to high, guess what, it does not sell.

[twix38]

Guess what, I didn't renovate at all, it was done when I bought it. It is still in very good condition. I paid 1 million 4 years ago and now want 1.6m net. Very reasonable over this period and against valuations a bit low but about right.

Guess what. Estate agents have told me the price is not the issue. They need customers. That is the issue. The market is turning dire. I have been told not to reduce more, as the price is NOT the problem and the condo is very nice and in a foreign name.

So, guess what. You will not be selling so easily going forward, although buying is very very easy. It's a buyers market and I think you made a mistake buying another 4. If you want to buy mine, I would be delighted as even viewings have ground to absolute zero now, but of course the market is fine, isn't it? Truth is it has slowed dramatically.

What a crock of 5hit. I have spoken to 4 or 5 estate agents just this week who ALL said it's DEAD! Really what planet are you on, cause it ain't planet Pattaya!!!!!!

I have sold 4 condos since January and bought 4 to replace them. But I only did 20 last year, so what do I know. You pay to much, do a bad job of renovating and price it to high, guess what, it does not sell.

Edited March 24, 2007 by twix38

[monty]

Don't know what is happening in the condo market, but the hunches I've heard is that indeed things are pretty slow.

I definitely know that the housing market, especially the slightly more expensive segment (say + 3mill Baht) is positively death!

I haven't heard of much houses being sold recently in the area I live in! Prices however are not coming down in general, apart from some isolated cases...

On the other hand, when the OP is looking to buy with as purpose to rent out, especially if he has some contacts in the industry, it probably is not a bad idea if you can snap up some deals.

The rental market is still going strong, the industry is not slowing down and all these expats need a place to live in!

I have several customers in my place who are expats working in the local industry (Eastern Seaboard) and they are all in relatively high priced rental houses (40,000 ->100,000 Baht/month)...

[Gary A]

Guess what, I didn't renovate at all, it was done when I bought it. It is still in very good condition. I paid 1 million 4 years ago and now want 1.6m net. Very reasonable over this period and against valuations a bit low but about right.

Guess what. Estate agents have told me the price is not the issue. They need customers. That is the issue. The market is turning dire. I have been told not to reduce more, as the price is NOT the problem and the condo is very nice and in a foreign name.

So, guess what. You will not be selling so easily going forward, although buying is very very easy. It's a buyers market and I think you made a mistake buying another 4. If you want to buy mine, I would be delighted as even viewings have ground to absolute zero now, but of course the market is fine, isn't it? Truth is it has slowed dramatically.

-------------------------------------------------------------------------------------------------------------

Let me guess. You have a shoe box sized studio, right? Those 32 square meter condos were selling for about 400,000 baht back then and some guys paid entirely too much and now expect a profit on top of their mistake.

[billaaa777]

It is still in very good condition. I paid 1 million 4 years ago and now want 1.6m net.

If you want to buy mine, I would be delighted as even viewings have ground to absolute zero now, but of course the market is fine, isn't it?

I will buy your condo. Please answer the following questions and I will tell you what it is worth to me. What building is it in? What floor is it on? Is it in a foreign name? What side of the building is it on?

I will post a few pictures of a condo that I recently renovated and sold for 1.5. A little more than your asking. It was 42 SM and everything in it was brand new. When attempting to sell a condo you really need to know your competition. A real estate agent is usually only able to show a few condos to a customer. So, if your place is not smoking hot with a good selling price, guess what, its not going to get shown.

[JimmyTheMook]

It is still in very good condition. I paid 1 million 4 years ago and now want 1.6m net.

If you want to buy mine, I would be delighted as even viewings have ground to absolute zero now, but of course the market is fine, isn't it?

I will buy your condo. Please answer the following questions and I will tell you what it is worth to me. What building is it in? What floor is it on? Is it in a foreign name? What side of the building is it on?

I will post a few pictures of a condo that I recently renovated and sold for 1.5. A little more than your asking. It was 42 SM and everything in it was brand new. When attempting to sell a condo you really need to know your competition. A real estate agent is usually only able to show a few condos to a customer. So, if your place is not smoking hot with a good selling price, guess what, its not going to get shown.

From the slanted window looks like a View Talay.

The market here in Pattaya is dead , we have 2 houses for sale with very little interest listed all over the place.

Condo's seem to still have buyers if priced right, but as noted so many are so overpriced it is a joke to even consider them.

[billaaa777]

The market here in Pattaya is dead , we have 2 houses for sale with very little interest listed all over the place.

The housing market is dead. You can't buy it in your own name and with the change in the laws regarding companies there are just a very limited number of buyers. An agent told the only houses that are selling are very inexpensive ones the buyers can put in their wives name or they don't care if they lose.

As for the condo market, which you can buy in your own name it is booming. Just look at all the buildings going up and the condos being sold in those buildings. If you don't believe me just walk into any sales office of a developer and ask to see what’s available. View Talay 5C was completed just over six months ago with approximately 1,000 units, of which a little less than 500 can be bought in a foreign name and it is sold out. And there even selling condos there in company names. Ask about View Talay 6 or 7, which are not even finished, there way over the 49% all ready.

[JimmyTheMook]

The market here in Pattaya is dead , we have 2 houses for sale with very little interest listed all over the place.

The housing market is dead. You can't buy it in your own name and with the change in the laws regarding companies there are just a very limited number of buyers. An agent told the only houses that are selling are very inexpensive ones the buyers can put in their wives name or they don't care if they lose.

As for the condo market, which you can buy in your own name it is booming. Just look at all the buildings going up and the condos being sold in those buildings. If you don't believe me just walk into any sales office of a developer and ask to see what's available. View Talay 5C was completed just over six months ago with approximately 1,000 units, of which a little less than 500 can be bought in a foreign name and it is sold out. And there even selling condos there in company names. Ask about View Talay 6 or 7, which are not even finished, there way over the 49% all ready.

The View Talay projects are really overpriced IMO , I know someone who is already regretting his down payment on two of the above named units.

I think there are many desperate sellers in Pattaya in both the Condo and House market right now.

Buyers market.

[billaaa777]

The View Talay projects are really overpriced IMO , I know someone who is already regretting his down payment on two of the above named units.

I think there are many desperate sellers in Pattaya in both the Condo and House market right now.

There are literaly thousand's of people that disagree with you. That being said, PM me if you know of a condo for sale, becuase I am buying. By the way, what building do you own your condo in?

[maccaroni man]

The View Talay projects are really overpriced IMO , I know someone who is already regretting his down payment on two of the above named units.

I think there are many desperate sellers in Pattaya in both the Condo and House market right now.

There are literaly thousand's of people that disagree with you. That being said, PM me if you know of a condo for sale, becuase I am buying. By the way, what building do you own your condo in?

condos priced at under 2m is pocket change for anyone with any kind of savings, hence it is logical that low ball prices sell in volume but when i went shopping for a house in pattaya, the new airport had just opened and the prices were hike up by more than 200% i.e. from 3m to 9m or 10m. I would bet that those prices have dropped considerably in the last few months and the houses priced at 8m or abouve are sitting still.

[Pattaya46]

Ask about View Talay 6 or 7, which are not even finished, there way over the 49% all ready.

Wrong !

Most of the appartments are not sold, they are only reserved (for 50.000 bahts) by reselers. Look at all the advertisments in revues like Pattaya Traders. They are full off View Talay 6 appartments, even the 1st cover page !

Pattaya46

[the gent]

Why on earth would anyone buy in what has always been a notoriously illiquid market ?

The top end of this market has evidently suffered a knock through a combination of over supply and a dearth of buyers. This in anyone's terms is a bear market and inevitably there will be a flight to quality with the lower end stagnating or being discounted to the point beyond economic sense.

Surely rental is the only sensible way to go ?

[bingobongo]

oversupply, oversupply....and guess what....oversupply

Correcting for inflation Thailand’s house prices peaked in 1992, and today’s prices are still 10% below the 1992 level. This is largely because, contrary to popular belief, house prices in Thailand were not rising pre-crisis. Indeed the mid 1990s actually saw a mild decline, in real terms. That decline accelerated after the Asian crisis, and house prices fell 18% from 1998 to 1999.

Thailand’s house price index quickly recovered post-crisis. It rose 53.8% (29.3% in real terms) from 1999 to 2006 thanks to strong economic growth.

However, all is not well in the political arena. As political pressure built up for Prime Minister Thaksin to resign leading to the September 2006 coup, the house price index fell 1.7% (3.5% in real terms) in 2Q 2006 over the previous quarter.

Conclusion: No real estate boom in Asia

Asia’s housing markets are on the road to recovery. But in contrast to the spectacular house price booms elsewhere in the world, the housing boom in Thailand and the Philippines is a construction boom. Europe, the US, Australia, and New Zealand have seen real estate booms -- prolonged above inflation increases in house prices. Asia has experienced in contrast a very substantial real decline in house prices over the same period.

This may be partly because in Asia there are few limits on new construction, whereas in most developed countries new construction is much more tightly constrained by regulations.

[thaigene2]

Agree with the above...you farang real estate guys - time to move on AGAIN. Where to this time? Mexico? Canaries? Time-share for eco-tourists on Antarctica? (take your jumpers)...

[swain]

Hello,

I get from some people here that perception is everything. If you say its great.. then its great.. you say its falling to shit.. it becomes a self fulfilling prophecy.

From what I have seen here in Chiang Mai, up in the Hang Dong area there appears to be a huge drop off in people buying houses and my friends that are trying to sell them have discounted them heavily. Don't get me wrong ,I own two houses up here as well, one for my family and one for me and my wife so I am dug in. Granted the pollution of late is not helping any but that aside, I have not heard of a house being sold for over 8 months now. Which is strange as when we moved in over 3 years ago they were going like hot cakes. I do have friends that have come and visited, but the one that felt like it might be worth doing felt that if he waited, that the baht would drop and he could get the deal I got.

This is just a personal observation and not based on any numbers.

Edited March 24, 2007 by swain

[billaaa777]

Wrong !

Most of the appartments are not sold, they are only reserved (for 50.000 bahts) by reselers. Look at all the advertisments in revues like Pattaya Traders. They are full off View Talay 6 appartments, even the 1st cover page !

Pattaya46

While it is true a condo is not officially sold until the building is completed and the documents are taken to the land department. It is not true, that you can just put down 50,000 to reserve a condo. You need to put down a substantial down payment and the make monthly payments for years until the building is completed. When the building is finished you then pay the balance due. So these people have hundreds of thousands into these condos before they officially own them. I am certain a percentage of these people default and never own the condos, I am also certain this is a very small percentage.

When it only takes 5 minutes to walk into a sales office and acquire the correct information. Why would you just post BS which you have no idea what you are talking about. There are thousands of people making these payments monthly who have made the down payment.

[snoophound]

At last a Pattaya resident who can admit why hes there!

Most say ,for the climate,for the people,for their incredibly successful businesses....

Must say every time I go and look in agents windows its the same properties posted months and even years later.

Property still seems cheap,but I wonder about rent collection?How difficult can it be?

My impression as simple "sexpat" here in Pattaya not personally involved in real estate market is that prices shown in agency's windows are always the same, but I wonder if properties for sale still get sold. There are a lot of new developments going on, and I think that in a few months some developers will be in need to sell urgently and the market will turn seriously downwards. After all Thai authorities had so fun in kicking farang asses recently that only a true masochist could be willing to reward them putting out his cash to invest here.Better wait and see.