After rebates and freebies, Thai developers to auction flats online in bid to shake off supply glut

[snoop1130]

Workers at an apartment project in Bangkok. An economic slump and protests against the military-led government have hurt developers who struggle to shake off a supply glut. Photo: AFP

 

After dangling rebates and freebies to attract buyers, Thai  developers are trying out a new strategy to trim their inventory of unsold homes by auctioning them online at deep discounts.

 

Some 120 flats in several projects across the Southeast Asian country will be made available for bidding next month on whyborder, an online property portal owned and operated by a Singapore-based company. The flats are expected to be offered at 20 to 40 per cent below their selling prices.

 

The apartments range from studio units to penthouses, starting from HK$388,000 (US$49,893). Among the projects in Bangkok to be included in the promotion are the Maru Ladprao 15 in Chatuchak and Hyde Sukhumvit 11 in Khlong Toei, and Manor Sanambinnam in Nonthaburi district outside the Thai capital.

 

Full Story: https://www.scmp.com/business/article/3148446/after-rebates-and-freebies-thai-developers-auction-flats-online-bid-shake

[matchar]

Nice marketing stunt. 40% off the "selling" price AKA asking price is probably still way too expensive. No wonder they are trying to flog them to foreign bidders who won't even be able to inspect the flats and notice the poor build quality.

[milesinnz]

and what will the owners who bought at the "list" price be feeling ?

[zzaa09]

"Shake off....."?

????

[Henryford]

They will have added 40% to the asking price first.

[nausea]

I can't think of a better way to crash the market than offering genuine 40% discounts. Prices must be inflated - an old pre-sales trick, and if nothing is selling anyway doesn't really matter what you set as the current list price.

[fusion58]

Supply glut? Sounds like the usual suspects are going to need to find another way to launder their money.

[carbon007]

If 40% is added before discount the discount is only 16%

[hotchilli]

Another sales stunt... 40% off bargain.. LOL

[khunjeff]

"The number of unsold flats stood at 289,742 units nationwide at the end of June this year, a 1.2 per cent decline from December, according to Colliers. On average, prices retreated 2.4 per cent from a year ago."

 

The fact that prices have allegedly fallen only 2.4% with almost 300k units unsold tells you immediately that the pricing information is grossly non-transparent at best, or completely manipulated at worst. With that big of a glut, real market prices should have dropped like a stone. 

[spidermike007]

The pain will be felt for many years to come. I anticipate condo prices to drop by half. A friend of mine recently moved to Pattaya. He looked at condos in Jomtien. He walked into one of the nicest towers, looked at a 36th floor unit with panoramic views, and when he was quoted 28,000 a month, he offered 10,000. They settled on 13,000. He said the agent more or less admitted the building was nearly empty, and they could barely rent or sell anything, at this time.  

 

A close friend told me his girlfriend is a senior level manager for one of Thailand's biggest developers. She told him that they have reduced their building by 90% of what it was pre-Covid, which was around 100 developments a year. They have shut down many projects, mid construction. She said they are having a very hard time selling or leasing anything right now, residential or commercial, at a price point that makes sense. That is how bad things are. The economy here is decimated. And alot of it is due to extreme cowardice, on the part of Cha Cha, and his boys. 

Demand is way down. The Chinese market is nearly gone, Russians and others are very hesitant to commit. Buyers who previously put down deposits, cannot even come and inspect their units, without jumping over stupid hoops, and begging the Thais for a visa. And the long term tourists are gone too. So, who does that leave? Wealthy Thais, many of whom see the market collapsing, and would rather wait and see how all of this shakes out, and ex-pats, many of whom are smart enough to be shopping for bargains right now.

Anyone interested in buying a condo right now, would be better off waiting awhile. Timing is on your side. Time is now your ally. The economy is going remain devastated here, for a very long time to come. And the longer this goes on, the more people are going to be affected by it, and the more desperate some will become. For the wealthy it barely matters. But, there are many middle class who have money invested, and there are alot of Chinese and Russians who bought, and cannot even visit Thailand. Some of them will want to unload their properties. Wait. The condo market is severely overbuilt. And demand is low, for all but the top buildings. This shakeout will likely make 1997 look like a cakewalk. 

 

 

Edited September 14, 2021 by spidermike007

[mikebell]

57 minutes ago, fusion58 said:

Supply glut? Sounds like the usual suspects are going to need to find another way to launder their money.

Totally agree.  Despite Pattaya being empty, there are numerous developments still ongoing because they daren't put the money in the bank.  Look at Joe Ferrari.

[Pravda]

Hey Mike, can you post sometimes without writing 10 paragraphs? This is about the 50th time I read about your friend from Pattaya getting a rental bargain in Jomtien. Do you copy and paste this stuff?

 

Btw, there's not going to be a total condo collapse. While it's certainly bleak there was a major printing press working overtime printing money. You can trust US government to keep the worldwide real estate going. I thank Ben Bernanke for pioneering this trend.

[rupert the bear]

more single digit IQ half wittery,theres no demand compared to pre covid days,whos going to buy?its that simple. the condo mkt is maybe 15 % of what it was,so stop building duuuur stop putting more new units into the mkt duuuur.thais have little money except for the scum at the top.they wish to further beggar the rest of us by making rediculous offers.the answer is increase demand and quit putting more units into the mkt till the situation balances,this is hardly an einstein like theory,is it so difficult to grasp?theres pent up overseas demand.allow buyers in if theyve double vaxxed with a non chinese vacc and have a neg PCR.hey presto...if your in that bracket your safer than most thais and the locals are the risk factor not you BUT we are in half wit land as they continue to shoot themselves almost constantly in the foot...head and ass.

[rwill]

There is only one solution.  Build more condos!!!

[Orinoco]

3 hours ago, hotchilli said:

Another sales stunt... 40% off bargain.. LOL

Theirs a lot of big stunts in the property market. 

[Will B Good]

OMG!

 

Hyde 11.

 

If they are struggling god knows how other places are managing.

 

Ace location, top notch facilities and excellent management (not on commission, lived there)

 

Will be looking to bid myself.

[aussienam]

Trap for young players!  

 

Anything with the words 'discount' or 'sale' uttered by real estate agents is time to run.  

 

Prices marked up and then declared a 'discount' when shown they have been marked down.  Smoke and mirrors trick used by retailers every day.