Housing demand remains but buyers hesitant

[snoop1130]

Downtown Bangkok. (Photo by Mladen ANTONOV / AFP)

 

The third wave of Covid-19 continues to dampen the housing market and leads to changes in the type of property sought.

 

Just when Thais thought the “Work From Home” lifestyle had more or less faded from view, the third wave of Covid-19 struck in April, bringing Thailand back to square one and forcing people not just to work at home but also to spend most of their time there. Not surprisingly, this has prompted property developers to adjust to different norms.

 

Developers are continuing to focus on building low-rise housing projects to meet the changing consumer demands of the post-outbreak period. And they are not wrong: consumers are turning their attention to low-rise housing to support working at home and keep a distance from society.

 

Full Story: https://www.thaipbsworld.com/housing-demand-remains-but-buyers-hesitant/

 

-- © Copyright Thai PBS 2021-05-31

 

- Whatever you're going through, the Samaritans are here for you

- Follow Thaivisa on LINE for breaking COVID-19 updates

[ThailandRyan]

So it will be Villa style detached box homes by the KM instead of Condominium boxes.  Sounds like suburbia is coming to Thailand and long distance commuting will be the new norm.

[BritManToo]

5 minutes ago, ThailandRyan said:

So it will be Villa style detached box homes by the KM instead of Condominium boxes.  Sounds like suburbia is coming to Thailand and long distance commuting will be the new norm.

There's a couple of guys in my MooBaan (Chiang Mai) that commute to Bangkok to work.

[ThailandRyan]

2 minutes ago, BritManToo said:

There's a couple of guys in my MooBaan (Chiang Mai) that commute to Bangkok to work.

Had a few from Udon that did the same, except it was only twice a week they drove down and back sharing a condo near the office they worked in as upper management.  

[BritManToo]

Just now, ThailandRyan said:

Had a few from Udon that did the same, except it was only twice a week they drove down and back sharing a condo near the office they worked in as upper management.  

Back in the Uk I used to commute from Dorking (Gatwick) to Glasgow (company apartment provided).

Weekdays up North, weekends down South.

I spent less time travelling to Glasgow than I did travelling to London to work.

[Airalee]

From the article...

 

“The new wave of infections has resulted in many being uncertain about their job stability right now. Many still want to make sure that their jobs are solid before buying so have adopted a wait-and-see stance, an industry expert said.”

 

“The poll says 75.4% of consumers regarded debt as the biggest problem, while 44% saw income and expense as a big concern.”
 

 

I don’t believe that the real issue is “working at home and keeping distance from society”.
 

What it really boils down to is when an economy can be opened and closed at a moments notice, who feels confident enough to take on 30 years of debt?

 

[impulse]

I love the title.  Demand remains, but there's no buyers.

 

Had to be a real estate agent who wrote that.

 

[nemo38]

I wonder how many buy to let people have walked away from properties. Or people who lost their jobs who got foreclosed on.

 

Luckily, banks are very honest and wouldn't keep a mountain of bad debt quiet. Imagine a bomb shell like that dropping on the market.

[Airalee]

1 hour ago, nemo38 said:

 

I wonder how many buy to let people have walked away from properties. Or people who lost their jobs who got foreclosed on.

 

 

That probably depends on how many bought using borrowed funds and depended on incoming rent to pay their mortgage.  Foreigners who paid cash* for their properties are just sitting on dead (for the time being) assets.  How many are owned by foreigners vs Thais with mortgages?  Your guess is as good as mine.

 

*There actually are mortgages for foreigners to buy property internationally but at the interest rates I have seen it would be a negative cash flow even with a fairly substantial down payment.

[Airalee]

2 hours ago, impulse said:

I love the title.  Demand remains, but there's no buyers.

 

Had to be a real estate agent who wrote that.

 

It’s not a problem that lower prices can’t solve.  
 

And even as someone who has recently purchased a condo, I fully support lower prices even if it affects the value of my condo.  Why should anybody cheer for unaffordable housing?

[soi3eddie]

2 hours ago, impulse said:

I love the title.  Demand remains, but there's no buyers.

 

Or that people want the property but don't like the size, location, style or price. 

 

 

[soi3eddie]

20 minutes ago, Airalee said:

And even as someone who has recently purchased a condo, I fully support lower prices even if it affects the value of my condo.  Why should anybody cheer for unaffordable housing?

 

I bought my Bangkok condo 12 years ago. Is it worth more or less than I paid? I really couldn't give a rat's ass if up or down as it's a lovely place, spacious, homely and in a great convenient location for me. Well managed and with great neighbours and co-owners. At current prices for new BKK condos I would be very hesitant to the extent of no way! Super high prices for much less SqM. No thanks!

 

[RichardColeman]

6 hours ago, snoop1130 said:

Not surprisingly, this has prompted property developers to adjust to different norms.

Well, if they follow the unique suggestions of each person having their own loo during covid, the houses will each have 3 bedroom and 10 toilets

[Airalee]

1 hour ago, soi3eddie said:

 

I bought my Bangkok condo 12 years ago. Is it worth more or less than I paid? I really couldn't give a rat's ass if up or down as it's a lovely place, spacious, homely and in a great convenient location for me. Well managed and with great neighbours and co-owners. At current prices for new BKK condos I would be very hesitant to the extent of no way! Super high prices for much less SqM. No thanks!

 

You’ve definitely got the right attitude.  It’s a home, not an investment. 
 

Too many people think they are getting rich off of housing inflation but unless you are an investor with multiple  properties (hopefully income producing) or a fix and flip investor, it’s just a more expensive roof over your head and if you sell, whatever you buy will have appreciated along with it.  After commissions/fees/taxes to sell and rebuy, you’re actually worse off.  People talk about getting on the “housing ladder” and using the appreciation to upgrade....but does that really work?  
 

Let’s look at the math (figures just for illustrative purposes)

 

Let’s say your income will allow you a $100k home and someday you want to upgrade to the $200k home.  Currently, you’re $100k away.  Then, property values double.  Your home is worth $200k (lets assume you’ve only paid off half the mortgage....a generous assumption) so you sell for $200k and after 5% commission (ignoring all other fees etc.) you net $190k...pay off the remaining mortgage and are left with $140k.

 

But....the previous $200k dream home has also doubled and is now $400k.  So, instead of being $100k away, you are now $260k away from realizing that dream.  Bzzzzzt....you lose.

 

Try getting a real estate agent to wrap their heads around that concept.  It’s impossible.  
 

 

“It is difficult to get a man to understand something, when his salary depends on his not understanding it.”. 
 

-Upton Sinclair

[impulse]

3 hours ago, soi3eddie said:

Or that people want the property but don't like the size, location, style or price. 

 

Or that people don't have any money, nor income to borrow against.

 

[Destiny1990]

2 hours ago, Airalee said:

Then, property values double.

Maybe in Europe but certainly not here. ????

[BritManToo]

3 hours ago, Airalee said:

But....the previous $200k dream home has also doubled and is now $400k.  So, instead of being $100k away, you are now $260k away from realizing that dream.  Bzzzzzt....you lose.

Then your wife divorces you and is awarded the house ......... you lost it all!

[ThailandRyan]

7 minutes ago, BritManToo said:

Then your wife divorces you and is awarded the house ......... you lost it all!

Along with 50% of your savings, your pension, and all assets........yep been there and done that, along with 6 years of alimony, and child support.....lived in my travel trailer for a year parked on a buddies property, like a frickin bum.

[MRToMRT]

I see the property sector lobbyists are bored and trying to get their clients sector in the news again. The articles real title should be ... Forget Condos, suburbs are the new thing and we are going to building thousands on the money the banks will lend us soon.

[mikebell]

50 minutes ago, BritManToo said:

Then your wife divorces you and is awarded the house ......... you lost it all!

Been there & got the T-shirt.  Posters above are talking only about owning condos not a house.  Thailand could open up the market by allowing farangs the same rights as Thais in UK.  

[hotchilli]

11 hours ago, ThailandRyan said:

So it will be Villa style detached box homes by the KM instead of Condominium boxes.  Sounds like suburbia is coming to Thailand and long distance commuting will be the new norm.

Thank god there's a shortage of shipping containers... I could envisage a surge in them being bought & converted into metal boxes instead of concrete ones.

[ThailandRyan]

7 minutes ago, hotchilli said:

Thank god there's a shortage of shipping containers... I could envisage a surge in them being bought & converted into metal boxes instead of concrete ones.

Yup Container McMansions

 

Honey remember to close the big doors to secure our house before we ship in through the Panama Canal to be installed in Thailand on my mothers property.

[jacko45k]

5 minutes ago, hotchilli said:

Thank god there's a shortage of shipping containers... I could envisage a surge in them being bought & converted into metal boxes instead of concrete ones.

So that is why Retox on Lengkee closed, they got a better offer? 

[hotchilli]

17 minutes ago, ThailandRyan said:

Yup Container McMansions

 

Honey remember to close the big doors to secure our house before we ship in through the Panama Canal to be installed in Thailand on my mothers property.

A snip at 5 Million.

[ThailandRyan]

22 minutes ago, hotchilli said:

A snip at 5 Million.

But oh the views and then of course they better be insulated or you will boil like an egg on the inside.  We used one for our duck hunting camp.  When we were on the property we had the doors opened, all of our gear outside with cots inside for sleeping and mosquito netting, when we left the property the quads and all of our gear was stored back inside and both sets of doors locked.  Worked a charm, but alas that was winter in California, so we also had to run generators for power and to run the small heaters we had by the cots.

[onekoolguy]

If you want a nice property at a bargain price this is a good time to buy! There are very few buyers and some people just need to sell right now. While most properties are not good deals a few are. Over a period of a couple of months I looked at maybe 15 properties and all were overpriced. Then in two days I found 2 large pool villas in good neighborhoods. Both were priced at 4 million baht. Other similar homes were twice that. My wife made a full price offer on the first one but didn't want to pay a 30,000 baht charge for something. This was the first day of listing and they sold it to the next person in line that same day. The other house had been listed for awhile and had been in escrow several times and kept falling out? The problem turned out to be a relative of the out of town owner who was killing the sales by making terrible conditions for potential buyers such as asking for non refundable million baht deposits before inspections etc.  My wife is pretty experienced at working out real estate problems and ended up purchasing that one.  A lot of housing developments are mostly empty due to out of country owners not coming back because of the covid situation. Some of these people really need to sell and the people who get out there and make offers will get some great deals over the next several months!

[onekoolguy]

3 minutes ago, ThailandRyan said:

But oh the views and then of course they better be insulated or you will boil like an egg on the inside.  We used one for our duck hunting camp.  When we were on the property we had the doors opened, all of our gear outside with cots inside for sleeping and mosquito netting, when we left the property the quads and all of our gear was stored back inside and both sets of doors locked.  Worked a charm, but alas that was winter in California, so we also had to run generators for power and to run the small heaters we had by the cots.

Where was your Duck hunting camp?

[newnative]

5 hours ago, Airalee said:

You’ve definitely got the right attitude.  It’s a home, not an investment. 
 

Too many people think they are getting rich off of housing inflation but unless you are an investor with multiple  properties (hopefully income producing) or a fix and flip investor, it’s just a more expensive roof over your head and if you sell, whatever you buy will have appreciated along with it.  After commissions/fees/taxes to sell and rebuy, you’re actually worse off.  People talk about getting on the “housing ladder” and using the appreciation to upgrade....but does that really work?  
 

Let’s look at the math (figures just for illustrative purposes)

 

Let’s say your income will allow you a $100k home and someday you want to upgrade to the $200k home.  Currently, you’re $100k away.  Then, property values double.  Your home is worth $200k (lets assume you’ve only paid off half the mortgage....a generous assumption) so you sell for $200k and after 5% commission (ignoring all other fees etc.) you net $190k...pay off the remaining mortgage and are left with $140k.

 

But....the previous $200k dream home has also doubled and is now $400k.  So, instead of being $100k away, you are now $260k away from realizing that dream.  Bzzzzzt....you lose.

 

Try getting a real estate agent to wrap their heads around that concept.  It’s impossible.  
 

 

“It is difficult to get a man to understand something, when his salary depends on his not understanding it.”. 
 

-Upton Sinclair

     You can move up the 'property ladder' by buying, fixing up, selling at a profit, and then repeating that many times--eventually getting bigger and nicer properties.  My partner and I have done that here since 2010.  But, it does take work and many would not want to move every year or so.  

[Airalee]

1 hour ago, newnative said:

     You can move up the 'property ladder' by buying, fixing up, selling at a profit, and then repeating that many times--eventually getting bigger and nicer properties.  My partner and I have done that here since 2010.  But, it does take work and many would not want to move every year or so.  

I said that in my post ...“fix and flip”...but how many people have the wherewithal to do that?  Not many I’d bet.

[RafPinto]

15 hours ago, BritManToo said:

There's a couple of guys in my MooBaan (Chiang Mai) that commute to Bangkok to work.

Every day?

At least, can't get a lot of stress with the lady.