Here Is Proof The Bangkok Condo Market Is Still Booming

[pkrv]

PKRV

I used to think you were an original optimistic buyer - and I wished you well (and still do). But are you indeed a shill??

I had to look that one up, whilst I have the capacity to use other terms, I find myself in a position where I cannot even say that was uncalled for - why post -this is way off topic.

Hi Pkrv

Well, do let me apologize if I have insulted you.

So can I assume then that you are not selling condos or working on behalf of a company that profits from the sale of property? And you are therefore only a self-buyer of a single residential property for your own occupancy?

That was basically the question - sorry if 'shill' is a strange word (it sounds pretty grubby - I must admit. however here is the Oxford definition: "person employed to decoy or entice others" (which I doubt is you - since you bought yourself for yourself right?).

-TG2

Thaigene2 - you have used a very archaic word - the meanings of which have no bearing on me in any cogitation, but I should not have been put into a position where I had to say that. Are you OK? Please PM if there is a problem.

[Livinginexile]

I think the bubble has probably burst already - though I suppose it depends on your defintion of 'burst'.

As a purely anecdotal observation, I see more and more of these new hi and low rise condo buildings in the main central corridors (suk and pahoyothin) with a lot of emtpy windows (e.g. empty apartments) - but apparently fully sold-out.

So if these places are all owned by rich thais a few rich farangs who bought them as pied de terre (digs for when they are in Bangkok - or maybe a furture potential Mia Noi pad), then everything remains static.

But if those places were bought by speculators waiting to rent them out then that's probably another story about a collapsing market (if the narket was reliant on speculators).

One other possible indicator is a drop in rents as others have pointed out (at the higher end anyway). There is a one bedroom condo for rent in the recently completed Nobel Lite building in the Soi Aree area. The price: only 15,000 baht per month.

I don't know how you positively define a 'burst bubble' but I se it deflating from my perch..the rest of you, take a ride along the Skytrain route and look at all the empty windows in the new condo buildings...

Whatever, anyone buying now should check very carefully the audited accounts of the building they are buying into. Get you lawyer AND accountant to check these..

Thaigene

You bring up a good point here and this is a question I have asked myself many times, "with so many empty condo's around why are the rentals still so high"? and these condo's are fully sold too, believe me, I did the leg work when I was in the market a year or 2 ago. So the owners are just sitting on them.

Before I go on, let me give you another observation.

My company have offices in Hong Kong, Singapore, Jakarta, KL and Dubai and let me tell you, the situation is the same in these cities too. One of the biggest expenses for my employer is expat rent. In Hong Kong and Singapore the average expat rental on an average 1 bedroom is US$10,000 per month! and yet there are thousands of empty condo's.

I was in Dubai last month and the same situation, renting a condo is very expensive, yet there are thousands just sitting empty, and once again...they are all sold. My boss is in the market for one now are they are being sold out off the plan in the first 2 or 3 days of coming on the market.

To my mind...its a matter of supply V demand right? but these guys just sit on them. I think it's a waste of money when they could be getting rent.

Is it a tax issue they don't rent them? or they just could'nt be bothered?

The same is happening in Bangkok in the high end market.

I believe these foreign investors are in for the long haul, they are not short term players. It's just that the smart money is moving in big time. Short term speculators would be trying to get as much out of their investments as quickly as possible, and that includes trying to get a bit of rent out of them.

I believe it's the locals that are doing the "flipping" trying to make some cash from the foreign investors.

Anyway, just a thought.

[Mid]

It is nice to own your own property - much better than renting even if it isnt the greatest of investments that you will ever make.

warning rethorical .........

define own .........

[pkrv]

livinginexile - interesting analysis. I guess tax is very important, and can a Thai buy into the Foreign 49% ownership quota? Or is this dynamically allocated?

Because I am exploring I am being quite open - I have 30 days a year holiday the Bangkok pad will be empty for most of the year, it is a second home and not now up for rental. Seems a strange concept doesn't it? For a while I too could not understand why a lady I know owned 2 apartments in NY, 1 in Hampstead and 1 in Cap Martin, yet all were empty for most of the year and she didn't rent them out - I now understand why she didn't have to.

She was in FX then The dot com boom then hedge funds - yet invested her own personal wealth (made from others), in personal property - a life lesson?

Edited July 1, 2007 by pkrv

[Livinginexile]

I own quite a lot of property in Thailand - two villas in Phuket and a house in sukhumvit. My view of the market is fairly neutral - prices are cheap in Thailand compared to internationally and you get a lot of house for your buck. If you build a decent house you will make a reasonable return - not the sort of London property price return but a decent return.

The key point about the Thai housing market is that it is illiquid. If you go and buy some fancy off plan condo brand new you will almost certainly lose money. Buy in the secondary market or build for yourself and you wont go too far wrong.

It is nice to own your own property - much better than renting even if it isnt the greatest of investments that you will ever make.

liked your stance. for me, i'm a renter in one of the "exclusive" zones of sukhumvit, paying less than 9000b a month for a studio, 30 sq. meters, all included, yes internet also. as all say, location location location. i just don't need more than this. i certainly understand those that do. so, at 60,000 baht a sq. meter, my location is worth 1,800,000 baht. i have no desire to own in BKK, as i'm not so sure this city will evolve into that which i seek. best of luck to all, and may we all make the right decisions.

dog412

You say you rent for 9000bht per month in an"exlusive" part of Sukumvit? with location location location? Where exactley are you located? all I can say is it must be a dump at this rate, or you are renting at "mates rates" because this kind of rent is unheard of in the area you are describing.

I will give you an example:

http://www.cbre.co.th/cbre_thailand/Search...&Category=2

Heres another:

http://property.th.com/search_result.php?s...asc&nolist=

Cheapest I can find for a studio in the "location" you mentioned is 17,000 per month, double what you claim to have. For a 1 bedroom you will not find anything under 30,000 per mth.

Heres a bit more info that may interest you.

"CB Richard Ellis Thailand executive director James Pitchon told Property Report Thailand that demand for high-end rentals increased in 2006 and the number of expatriates in bangkok with work permits grew to 67,412 in 2006, a 12.5% increase year on year according to statistics by the Alien Occupational Control division of the Department of Employment. The largest segment of this market is Japanese - 22% - as the so-called “land of the rising sun” is the largest foreign direct investor in Thailand."

Prove me wrong dog, give me a site advertisiing a high end studio in a prime location for 9000bht per mth.

[Mid]

The largest segment of this market is Japanese - 22% - as the so-called “land of the rising sun” is the largest foreign direct investor in Thailand."

off topic warning ,

would be prudent not to rely on dated information , else where on the board today is a cite that the Japanese are developing a nervous tic .

[pkrv]

DOG412 do you live at the Wittayu Complex?

[cmsally]

Well a quick note not much time, but have spent most of the last 3 days on the condo hunt around BKK.

There's a lot of building going on for sure and most of those buildings sold out although not even up yet. And not a lot of resales from the people who got in first.

But I have not seen much on offer at the moment, even in the older buildings.

I have found some relatively good prices (but not large in numbers) and have mostly visited the buildings to be vastly disappointed.

I did walk past the Trendy (oh dear!). You can see its a makeover from the painting over cracks on the outer support beams and in one case you have some kind of plant growing out of an area where cement has fallen off to expose some rusty construction rods (about 3 storeys up at the front). I was going to take a picture but found myself wedged between a taxi and a som tam vendor, bit precarious.

Anyway think I have found something and the more I look the better deal it looks like, so will tell you all later. Hopefully get it sorted out by tomorrow.

But honestly I was surprised at how little there was.

Talked to quite a few people around Sukhumvit and the Japanese definitely driving up the prices there. On some of those sois difficult to navigate around unless you read Japanese!

I don't know about a boom,but I definitely don't see a slump.

Even rents from adverts I saw posted, the cheapest was about 14,000Bt for a studio.

Somehow I don't see a slump in the market, you may get problems with specific buildings when people bail out because they can't resell, but I don't think that will trigger a price drop. The only building I have seen with a big amount of resales is Lumpini ... (sorry can't remember if place or ville or something like that).

Anyway that's my opinion for now, maybe not a boom but I don't see the slump coming.

[think_too_mut]

Talked to quite a few people around Sukhumvit and the Japanese definitely driving up the prices there. On some of those sois difficult to navigate around unless you read Japanese!

I can read Japanese and the ads are just repeating the usual sales pitch.

Most of the Japanese are there on their company shout, That helps driving the rents up.

Not sure how much they buy to own. Perhaps not that much.

What I am reading is, they flock to Okinawa, it's their country, their laws, their language.

[rott]

DOG412 do you live at the Wittayu Complex?

pkrv, I am interested in the Wittayu complex - any opinions would be wlcome.

rott

[dog412]

DOG412 do you live at the Wittayu Complex?

no i do not. walking distance to emporium. nothing fancy, but as a single guy, it's reasonably quiet and comfortable. when looking for lower budget apts. those that require a substantial deposit, 3 months, will have a better class of renters. they are around, you just have to look. i am extremely satisfied with my place, and it's one of the reasons i'm still in bkk.

[dog412]

I own quite a lot of property in Thailand - two villas in Phuket and a house in sukhumvit. My view of the market is fairly neutral - prices are cheap in Thailand compared to internationally and you get a lot of house for your buck. If you build a decent house you will make a reasonable return - not the sort of London property price return but a decent return.

The key point about the Thai housing market is that it is illiquid. If you go and buy some fancy off plan condo brand new you will almost certainly lose money. Buy in the secondary market or build for yourself and you wont go too far wrong.

It is nice to own your own property - much better than renting even if it isnt the greatest of investments that you will ever make.

liked your stance. for me, i'm a renter in one of the "exclusive" zones of sukhumvit, paying less than 9000b a month for a studio, 30 sq. meters, all included, yes internet also. as all say, location location location. i just don't need more than this. i certainly understand those that do. so, at 60,000 baht a sq. meter, my location is worth 1,800,000 baht. i have no desire to own in BKK, as i'm not so sure this city will evolve into that which i seek. best of luck to all, and may we all make the right decisions.

dog412

You say you rent for 9000bht per month in an"exlusive" part of Sukumvit? with location location location? Where exactley are you located? all I can say is it must be a dump at this rate, or you are renting at "mates rates" because this kind of rent is unheard of in the area you are describing.

I will give you an example:

http://www.cbre.co.th/cbre_thailand/Search...&Category=2

Heres another:

http://property.th.com/search_result.php?s...asc&nolist=

Cheapest I can find for a studio in the "location" you mentioned is 17,000 per month, double what you claim to have. For a 1 bedroom you will not find anything under 30,000 per mth.

Heres a bit more info that may interest you.

"CB Richard Ellis Thailand executive director James Pitchon told Property Report Thailand that demand for high-end rentals increased in 2006 and the number of expatriates in bangkok with work permits grew to 67,412 in 2006, a 12.5% increase year on year according to statistics by the Alien Occupational Control division of the Department of Employment. The largest segment of this market is Japanese - 22% - as the so-called “land of the rising sun” is the largest foreign direct investor in Thailand."

Prove me wrong dog, give me a site advertisiing a high end studio in a prime location for 9000bht per mth.

i certainly never said it was "high end". how much would you expect middle class Thais should be spending on monthly rent? it's a decent apt. with a decent rent in a great location.

[pkrv]

DOG412 do you live at the Wittayu Complex?

pkrv, I am interested in the Wittayu complex - any opinions would be wlcome.

rott

Sure there were some comments on prices and from a guy who lived/lives? there on this thread (just over the first two pages)

http://www.thaivisa.com/forum/index.php?sh...ic=39330&hl=

I think you will see why I haven't directly cut out givews a more ballanced view.

[bingobongo]

let me start off with a defintion....

Reality, in everyday usage, means "the state of things as they actually exist." ^[1] The term reality, in its widest sense, includes everything that is, whether or not it is observable or comprehensible.

now, here is some more "reality", repeat after me, as supply increases, prices decrease...... lowering rates will lead to higher inflation and more oversupply as builders have access to cheap loans

Appeal of condo speculation growing

But party may not last as new supply arrives

Mr Phanom estimates that real estate investment from Singapore to Thailand has fallen by 10-15%.. ''They lack confidence in the market so they didn't come. Now they're going to Vietnam, China and Australia.''

For Bangkok, Mr Phanom is worried about the large number of condos that will be entering the market _ especially from megaprojects of between 500 and 1,000 units outside of the city centre, including Ratchadaphisek and Phahon Yothin roads.

''Should a lot of units enter the market there will be a problem of oversupply,'' says Mr Phanom. ''It will be difficult for the market to absorb a large number of units and rental returns will suffer.''

http://www.bangkokpost.com/Yourmoney/02Jul2007_money52.php

Edited July 1, 2007 by bingobongo

[craigt3365]

Excellent article. Thanks Bingobongo! I got the Nation today instead of the Post...oh well...

cmsally: Looks like we are doing the same thing. I spent the day before yesterday running up and down Suk looking at new projects. Calling the numbers to get info, etc. Almost all were sold out. And a few never answered the phone. I agree with you. It sure feels like a boom, and it does not look like a slump. But, time will tell. The future does not look that bright. But you never know!

[highdiver]

15 years ago.. yes 15 years ago. the london market started to boom. ever since then its been warnings that the real estate boom bubble is going to explode,

15 years later the dooms day predictions continue yet the market keeps on going up.

in bkk condos are selling like ho muffins out of the oven.

I went to buy a condo on friday and in the sales office it was packed with forigners. mostly russians and middle east.

the project is nealry sold out even though its far from compleation.

I spoke with the sales man and asked about the motivations of those buyers.

many of the buyers are buying it as a second or a holiday home. they dont care about the return or the value they just want to buy a condo in bkk where they can stay when they are in town. its cheaper to have a holiday home in bkk then in europe and the cost of staying shopping and entertainment is also cheaper.

they dont care if the house is empty most of the year. they dont want to bother with rentals.

Living in ex has pointed out a very true analisys. thousands of condoes empty but they are all sold out.. not just in thailand but all over the world.

I totaly agree. there are many pople who own a second and even a third home just for the sake of owning it and not as a speculative investment.

In palma in spain there are thosands of villas, condos, and aprtements that were bought not for investment but to be used as a winter getaway. they to are most of the year vacant.

people buy realestate for many reasons and investment, returns ,and taxes may not be the only considerations.

I belive that the cost of living and the low cost of travel is making bangkok as well as other thai destinations are very attractive to those wanting a second or a holiday home.

i belive thae market will continue booming..

[pkrv]

We are seeing the same in the UK – Picturesque fishing villages in Devon and Cornwall (to name but two) are now unaffordable to the locals, and indeed the local shops have closed or close most of the year because no one lives there. Summer holidays and the odd weekend visits are all that take place.

I would however say that putting all eggs into one basket, (i.e. only buying in one country) is a bit foolish. It only takes a dirty bomb to cause havoc in one country and spreading your risk across the world is seen as a good thing in the financial market place, so why not in the home market place?

Edited July 2, 2007 by pkrv

[bingobongo]

before you get excited about the headline......read the details......a whopping .3 percent increase as compared to 7.5 percent contraction is not what i would call "robust"........the devil is in the details

Real estate perking up

Land and construction transactions increased in May for the first time in 13 months, rising 0.3 per cent year on year, signalling a slight improvement in property, according to the Bank of Thailand

The increase came after a contraction of 7.5 per cent in the first quarter and a decline of 7.6 per cent in the past full year.

But the value of land and construction transactions contracted by 6.1 per cent year on year.

This was in line with decreasing prices for accommodation as developers stimulate demand, the bank said.

However, cement sales have declined since the beginning of the year with a reduction of 11 per cent in April, which implies the construction sector remains in the doldrums , the bank added.

http://www.nationmultimedia.com/2007/07/02...ss_30038883.php

Edited July 2, 2007 by bingobongo

[quiksilva]

Pretty much what I have been saying all along. Its slow but its not dead.

Construction is in the doldrums, good. We don't need any more supply.

Developers and banks can see that too hence the amount of new projects being announced has dropped off considerably, or at least is concentrated in sectors that were not serviced during the "boom times" i.e. low-middle income level condos. Perhaps this is where their change in "prices" comes from, they did not mention "values', which is a very important distinction.

This is the biggest difference between now and 1997, developers building less when demand drops, last time the players couldn't see the relationship between cause and effect, today however the veteran players are much more cautious with their approach, which is a sign that the market maybe maturing.

Edited July 3, 2007 by quiksilva

[trajan]

I agree with everything stated in the previous post, but one thing that is a slightly concerning is that companies (which are not in the real estate developing field) seem to be jumping on the train and starting such lines of business (e.g., the Major cinema company people (after merging their operations with EGV cinemas) getting into developing, the Saha Group joint venturing with Zokei etc.).....

are they all getting into the "still-in-demand" lower-end housing supply? or are the new projects kept in check by the bank's more conservative lending policies?

[quiksilva]

I also share that concern, bank's lending practices definitely help to take the wind out of some truly errr "interesting" schemes. A Japanese retirement village featuring working volcano on Chaeng Wattana Road was one I recall from about 4-5 years ago, thankfully that never saw the light of day!

There are problems with this group though, and they happen when these enterprising new players use alternative financing channels to fund their projects which can often be very poorly thought out by people whose egos are bigger than their planned towers and will not listen to advice. These projects tend to fare very poorly and are often the ones you see hitting the headlines with financial woes.

Out of the ones that have recently hit headlines I must say that I have not been in the least bit surprised but thankfully these are still in the minority, primarily because of these improved lending practices.

Edited July 3, 2007 by quiksilva

[pkrv]

Hi quiksilva - Sorry I tend to ask odd questions and I hope this does not appear off topic.

If a condominium building is 100% Thai owned and one condo comes up for sale can a foreigner buy under the 49% rule?

Conversely if a building is 49% owned by foreigners and one foreign ownership title comes up for sale, can this be transferred to Thai ownership?

Edited July 3, 2007 by pkrv

[quiksilva]

1) if it is a registered condo, then sure the 49% quota in that case has not been used so sure why not?

2) Yes, the only restriction is on the % of foreign ownership, not Thais, they could acquire all of it if they so wished.

[pkrv]

quiksilva - thanks again for your thoughts, deeply valued. I did try to explore the 49% issue on a separate thread.

I am going to be open and say I have never played the numbers game; it is not in my makeup. However I can now see where speculation will come from, it will be from Thais. A disaster will not affect most Ferangs one jot, however the impact on Thais....

I assume the concept of registered condos attempts to mitigate this?

[quiksilva]

A crisis by its very nature will affect Thais more than Farangs quite simply because there are more local players in the market.

Speculation hurts everyone.

IF this is happening on such a large scale to cause a crisis in the condo market then it would affect all owners indiscriminately. However, this is a seriously huge IF we are talking about. NOBODY in the market knows for sure just how many are being brought for speculative purposes, there simply is no way of accurately and independently sourcing that information. Developers themselves often don't know if their buyers will be residents themselves.

My personal opinion is that the days of speculation are over, and have been for about 18 months now. Anyone who has been trying their hand at it since will be in for a rude awakening when they trip to flip for a profit. There is quite simply not that much heat left in the market any more.

Condo registration does nothing to mitigate risk of speculative players. The best defence against them is to buy in developments that prohibits the assignment of sales and purchase agreements before the transfer date.

[pkrv]

quicksilva - I can only add to your thoughts. Governments often try to manoeuvre things in the 'revenue' earning direction' and so oddly introduce market distortions. That is why I found the 49% rule so very ‘odd’.

From my experience market distortions are very, very, very short lived and rapidly become an embarrassment. Thais will be the worst hit if anything goes wrong. Though I don’t think the market will go down,

Don't know this is an open question.?

[thaigene2]

Read through these two paragraphs they relate to property - have patience.

My wife (thai) said recently to me that an ex-boss of hers (thai-chinese) spent all his father's money on a series of goofy business ventures all of which went bankrupt in a matter of months. Now both thai-chin parents are dead, and he's been forced to sell the property they had - cause he's stupid and has nothing else left (no ideas and no money).

Meanwhile, other thai-chin kids continue to spend their parent's money on buying condos 'to rent' to "someone" cause they see a way to make money. See any connection?

I do.

My wife's one of the smartest Thais I know.

[pkrv]

Sorry for the double post - (also posted on the 'Under the current climate thread....')

http://news.bbc.co.uk/1/hi/world/asia-pacific/6260720.stm

The day the Thai economy crashed By Jonathan Head

BBC News, Bangkok

Thais remember the crash On the morning of 2 July, 1997, the Bank of Thailand finally gave up its eight month-long battle against local and international speculators, and abandoned the peg that tied the value of the Thai baht to the US dollar.

Its desperate defence of the peg had all but exhausted the $40bn in foreign reserves; less than $3bn remained.

Thailand, a country that had enjoyed four decades of almost uninterrupted economic growth, and was admired all over the world as one of the Asian Tigers, was broke.

The country's decision set off panic throughout the rest of South East Asia, as investors started pulling out the billions they had bet on the miracle economies of the East.

It set off even more panic among local entrepreneurs.

Many had borrowed heavily in US dollars to cash in on the frantic property boom.

They did so to get around the high interest rates inside Thailand, raised by the central bank to support the currency and curb over-investment.

They had believed the government's promise that it would never abandon the currency peg.

Overnight their debt payments shot up, and they frantically bought dollars to try to cover their loans, putting even more pressure on the baht.

By the end of 1997 it had slid from 25 to the dollar, to 58.

Today if you ask people 'Do you remember the 1997 crisis?', they don't remember

Sirivat VoravetvuthikunSirivat Voravetvuthikun was one of those swept up in the thrill of speculation.

He had played the stock market, and caught the property bug. He borrowed heavily to develop a luxury resort in a national park east of Bangkok.

"I was an honest businessman, but I was greedy," he told me. "I had 100 million baht, I wanted a billion, so I borrowed a lot - at that time I was paying 17% interest, which brought me down on my knees."

New attitude to life

Sirivat's response to his financial ruin made him one of the emblematic figures of the crisis.

He and his wife resorted to making sandwiches, and sold them on the streets of Bangkok.

Ten years on, he has built it up into a small catering business - but, unable to borrow, he has little chance of becoming the millionaire he once was.

He does not seem to mind, though.

"This is a real business, that deals with real people," he said. "It's not like a bubble business."

The crash nearly wiped out Vikrom Kromadit as well. He had built one of Thailand's most powerful companies, through developing huge industrial parks for the foreign manufacturers who had been pouring into Thailand during the late 1980s and early 1990s.

For many Thais, the financial crash is merely a distant memory"My bankers would come to me after the devaluation and say: 'Vikrom, can you pay back just a little?', and I told them I did not even have enough to pay my staff salaries," he told me.

Vikrom's Amata Corporation has bounced back, but he has radically changed his philosophy.

"I no longer run the day-to-day business of the company. I am just the dreamer, the planner, the trouble-shooter. I work only one day every two weeks, and most of the time I stay outside Bangkok, reading and writing," he said.

The crisis left deep scars on the Thai psyche, after four decades in which its people had known only economic success.

There was the search for scapegoats, initially foreign speculators and the International Monetary Fund, whose rescue package required some painful medicine for the Thai business community.

Later the central bank governor, Rerngchai Marakanond, was prosecuted and fined $5bn for his negligence in depleting Thailand's foreign reserves.

There was an upsurge in nationalist sentiment, and demands for political reform.

That led to the political triumph of Thaksin Shinawatra, a charismatic telecoms tycoon who weathered the crisis and went on to form a new political party, Thai Rak Thai.

He won two record election victories in 2001 and 2005, largely on his promises to lead Thailand out of the economic gloom and make it a winner once more.

His high-handed, provocative style of government eventually drove the military to push him out in last year's coup.

Moving on

So have lessons been learned? Could a repeat of the financial mayhem in 1997 occur?

"Thai people seem to forget things very easily," said Sirivat Voravetvuthikun. "Today if you ask people 'Do you remember the 1997 crisis?', they don't remember."

Certainly the banking and financial system is better regulated now, and crucially, the currency now floats, so the likelihood of such a dramatic devaluation is now remote.

The Muang Thong Thani development still needs investorsIf anything, Thailand is suffering the opposite problem today - too much foreign currency coming in to buy low-priced Thai assets, thus strengthening the baht and hurting exporters.

The economy has recovered, but not to the ebullient pre-1997 levels.

It now chugs along at around 4% a year.

It is true that there is plenty of construction underway again in Bangkok, and perhaps a little of the property fever of the 1990s: in the city centre most of the half-finished concrete shells, 'monuments to speculation', that were left after the crash, are now being completed.

But just outside the capital is the massive Muang Thong Thani development, a would-be satellite city of 26 tower blocks that is still only around 20-30% occupied.

The fact that no-one has yet been willing to put up the money to finish Muang Thong Thani is a telling indicator of the caution many investors now feel about betting on Thailand.

The year of 1997 also marked the time when the 'miracle economy' baton was passed on to China, India and Vietnam.

Thailand, like other South East Asian countries, is struggling to compete with these star performers of the global economy.

South East Asia now gets just a fraction of the foreign investment that goes into China.

"We don't invest enough in our human resources," said veteran economist Amar Siamwalla, from the Thailand Development Research Institute.

"We don't put out enough engineers, technicians, and we rely too heavily on investment by foreign multinationals for our industrial development," he said. "Thai investors prefer to put their money in property."

All the betting now is that any future financial crisis on the scale of 1997 will not start here, but in China, India, or even the United States. South East Asia's moment in the sun has probably passed.

[pkrv]

I will be the first to hold my hand up and say I have no deep insight into the Thai people.

What I would say is that from the above article the Thai people are following the same pattern as the UK. Essentially to invest (other than in an add hock manner) using long term strategies and managing risk you lose control of your own money. Why do I say that well endowment policies, pension funds etc come to mind.

Too many people have been burnt and seek direct control of their own resources; the only way open is through home ownership that is it. Proof The UK has layered stamp duty and even average homes are targeted under inheritance tax laws. The government feels this is a revenue stream that needs to be exploited but has difficulty in doing so, so is more attractive, you just have to be cautious.

Of course the money then does not flow into investment, but until investments are utterly transparent and run by competent people (those who wish control are usually the most incompetent) the situation will not change.

I could see a situation arise where if competence were to be a factor in the investment industry, money would flow from the housing market, however this will not happen. Proof of this was during WW2, it took bringing the UK to its knees to start military promotion being based on competence, two sunken warships off of Singapore stand testimony.

I can understand limiting supply in the housing market, as ‘I am OK Jack’ it doesn’t affect me, what is interesting is that people are now struggling to buy into projects that are 4 years off. Time perhaps for the, secondary market to kick in? Distortions create yet more distortions.

I know of Hamptons and CBRE a quick search will yield more.

[cmsally]

pkrv I would say you are right from what I have seen. A lot of people I know in Bangkok are buying up either properties in the city or heading out to other areas to buy. They see it as an investment and are not doing this with a mortgage.

It is seen as a safehaven for money and even if the market takes a tumble they are sure it can only go up in the longterm. No one wants to leave their money in the bank with these miserable interest rates.

I have met quite a few people in Chiang Mai over the past month looking for land to buy and in Bangkok a couple of people I know recently bought 4-5m condos just so they don't have to commute.

I went hunting for condos that were with the LED and found only a few in a good location. One I was interested in was auctioned off last week for double the starting price - fairly cheap but definitely not a bargain considering it would probably need to completely redecorated/fitted.

At the moment my choices are limited but I think I have something lined up and am still negotiating, it is in a new building though.

Seriously my choices were very limited, there are not many bargains to be had. But when you consider this is a capital city it is still very affordable and areas in capital cities very close to transport links are limited so I don't see it as much of a risk.

I have thought about it a lot, whether I want to spend the money or not, but I need to have a place so would being paying rent anyway and in a couple of years will I be able to afford a place in a nice area in the centre of BKK with a 2 min walk to the BTS, I think the answer could be, maybe not.