Baht Strengthens- Real Estate Suffers

[pkrv]

Dr. Naam - Everyone’s position is different here, you obviously know about the industry - I am going to be open, and perhaps this helps?

In the past I directly transfered THB converted from GBP to the developer’s account, it worked well - I would not recommend this in all instances – but I feel comfortable with this and this project (The Park).

I do not have a Thai Bank account just yet, but will need one down the line.

So I now have to build a relationship with the developers bank (Thai Krung) and see what they will do. (or fly out just to open an account - god that would be boring!)

I have unfortunately heard stories that the onshore rate can be applied (but this is what happens when Transparency is broken). I am not saying they are true or false I am just exercising due diligence. And as I can look into the market, I too know rates that are applied.

I will report back on my findings.

[pkrv]

thanks for the input,

But unfortunately - the currency I am transfering has to be done offshore as LOS can not do it onshore - so this onshore/offshore does not apply to me.

You may be able to resolve this - Counter intuitively a double currency conversion could actually help you (in this instance). Convert to USD or Sterling (or any other major currency) then transfer that currency directly to Thailand. But just watch the rates you are being offered on both legs of the deal.

[shochu]

pkrv,

Have already looked into it. Unfortunately my currency is strenghtening against most except the baht. After the conversions - I will be no better off and the problem then is getting approval as it is easier when the same transactions have been carried out for the letter for the right to buy the condo. I have a baht account in LOS that I can draw on for the condo I bought - except for the final payment - and by then - I expect things to have worked itself out back in my favor one way or another as I am also hedging some other investments to eliminate any losses I may incur in the final payments. And I also expect this offshore/onshore to go away before I have to make the final payment. I think we are in for some interesting months ahead in terms of currencies and economies so I wait!

[Naam]

Dr. Naam - Everyone’s position is different here, you obviously know about the industry - I am going to be open, and perhaps this helps?

sorry pkrv but i do not understand your problem.

[KamalaBrian]

so much living in denial, so little acceptance of reality......

Home-builders feel the pinch amid uncertainty

The Nation: 24 July 2007

Home-builders expect to post a slight drop of 6.25 per cent in sales this year, due to concerns of prospective home-buyers about their future income in the wake of political turmoil and the economic downturn.em

http://thailand-property-guide.com/?p=news...&NewsID=479

I agree.

On a couple of other threads I've put some bank repossion websites (cause I've just been through the process of buying) and they are rampacked with properties that unfortunate Thai families were unable to keep. Bad news.

How do I find out the website for the foreclosures please?

Thanks

[backflip]

Here are 2 websites:

property.scb.co.th

www.krungsriproperty.com

[pkrv]

Dr. Naam - Everyone's position is different here, you obviously know about the industry - I am going to be open, and perhaps this helps?

sorry pkrv but i do not understand your problem.

Blunt - The fees were peanuts I almost hit the pips.

Edited July 30, 2007 by pkrv

[pkrv]

I have unfortunately heard stories that the offshore rate can be applied (but this is what happens when Transparency is broken). I am not saying they are true or false I am just exercising due diligence. And as I can look into the market, I too know rates that are applied.

I must apologise I become highly dyslexic when thinking, from past experience I know this causes problems as I am working through things. See above correction - to my past post.

[cmsally]

I have unfortunately heard stories that the offshore rate can be applied (but this is what happens when Transparency is broken). I am not saying they are true or false I am just exercising due diligence. And as I can look into the market, I too know rates that are applied.

I must apologise I become highly dyslexic when thinking, from past experience I know this causes problems as I am working through things. See above correction - to my past post.

Even if you transfer to the developers bank instead of your own, just make sure that you do the transfer in the senders (your) currency (ie pounds). As long as you do in writing or online where you can print , there can't be any problems as the money will come to Thailand in foreign currency. I have never seen a bank here try to exchange using an offshore rate when they receive foreign currency. You could try and get something in writing from the developer or their bank stating transfer will be in pounds and they confirm onshore rate used.

[otherstuff1957]

Here is the website with the official Tha Government list of mortgage foreclosures:

http://asset.led.go.th/newbid/asset_search_map.asp

Be warned though, the amount listed for each property is the amount awarded to the foreclosing bank, NOT the amount the bank is asking for the property. Most banks will list their properties at market value, not at a reduced price, as they hold the properties on their books as assets, rather than liabilities.

Also, if you buy a property that the former owners have not vacated, you should be aware that Thailand has very strong resident's rights and very weak eviction laws. Be prepared to spend a lot of time and money getting rid of squatters.

[pkrv]

I have unfortunately heard stories that the offshore rate can be applied (but this is what happens when Transparency is broken). I am not saying they are true or false I am just exercising due diligence. And as I can look into the market, I too know rates that are applied.

I must apologise I become highly dyslexic when thinking, from past experience I know this causes problems as I am working through things. See above correction - to my past post.

Even if you transfer to the developers bank instead of your own, just make sure that you do the transfer in the senders (your) currency (ie pounds). As long as you do in writing or online where you can print , there can't be any problems as the money will come to Thailand in foreign currency. I have never seen a bank here try to exchange using an offshore rate when they receive foreign currency. You could try and get something in writing from the developer or their bank stating transfer will be in pounds and they confirm onshore rate used.

cmsally - thanks for this. To be honest my options come down to these few points:

1) Direct transfer of Sterling to the developers account - who knows the rate, the charges etc I will have to over send. So much for the concept of the Foreign Exchange Transaction Form, mind you I could see how that could be used.

2) World First (my broker) cannot help - they also will not do a sterling transfer.

3) Sterling Transfer from Nationwide (to the developer) - Nationwide do not trade in THB.

4) Open a London and Bangkok Branch of Bangkok Bank - working on this - to give me more options. They are a correspondent bank see link.

http://www.thaivisa.com/forum/index.php?showtopic=133023

But that is about it.

Edited August 1, 2007 by pkrv

[jackr]

I have unfortunately heard stories that the offshore rate can be applied (but this is what happens when Transparency is broken). I am not saying they are true or false I am just exercising due diligence. And as I can look into the market, I too know rates that are applied.

I must apologise I become highly dyslexic when thinking, from past experience I know this causes problems as I am working through things. See above correction - to my past post.

Even if you transfer to the developers bank instead of your own, just make sure that you do the transfer in the senders (your) currency (ie pounds). As long as you do in writing or online where you can print , there can't be any problems as the money will come to Thailand in foreign currency. I have never seen a bank here try to exchange using an offshore rate when they receive foreign currency. You could try and get something in writing from the developer or their bank stating transfer will be in pounds and they confirm onshore rate used.

cmsally - thanks for this. To be honest my options come down to these few points:

1) Direct transfer of Sterling to the developers account - who knows the rate, the charges etc I will have to over send. So much for the concept of the Foreign Exchange Transaction Form, mind you I could see how that could be used.

2) World First (my broker) cannot help - they also will not do a sterling transfer.

3) Sterling Transfer from Nationwide (to the developer) - Nationwide do not trade in THB.

4) Open a London and Bangkok Branch of Bangkok Bank - working on this - to give me more options. They are a correspondent bank see link.

http://www.thaivisa.com/forum/index.php?showtopic=133023

But that is about it.

Never had a problem SWIFTing Sterling from HSBC or Halifax. Usually 20 pound (or less) charge UK end and 500 baht Thai end.

[pkrv]

I have unfortunately heard stories that the offshore rate can be applied (but this is what happens when Transparency is broken). I am not saying they are true or false I am just exercising due diligence. And as I can look into the market, I too know rates that are applied.

I must apologise I become highly dyslexic when thinking, from past experience I know this causes problems as I am working through things. See above correction - to my past post.

Even if you transfer to the developers bank instead of your own, just make sure that you do the transfer in the senders (your) currency (ie pounds). As long as you do in writing or online where you can print , there can't be any problems as the money will come to Thailand in foreign currency. I have never seen a bank here try to exchange using an offshore rate when they receive foreign currency. You could try and get something in writing from the developer or their bank stating transfer will be in pounds and they confirm onshore rate used.

cmsally - thanks for this. To be honest my options come down to these few points:

1) Direct transfer of Sterling to the developers account - who knows the rate, the charges etc I will have to over send. So much for the concept of the Foreign Exchange Transaction Form, mind you I could see how that could be used.

2) World First (my broker) cannot help - they also will not do a sterling transfer.

3) Sterling Transfer from Nationwide (to the developer) - Nationwide do not trade in THB.

4) Open a London and Bangkok Branch of Bangkok Bank - working on this - to give me more options. They are a correspondent bank see link.

http://www.thaivisa.com/forum/index.php?showtopic=133023

But that is about it.

Never had a problem SWIFTing Sterling from HSBC or Halifax. Usually 20 pound (or less) charge UK end and 500 baht Thai end.

Take care mate. The fees are irrelevant it is the rate that counts. I could be charged 1m THB if I make an error. That is how bad it is. Out of interest is there a recourse for any banking 'error' in Thailand, (sorry I am seeking more ammunition).

[bingobongo]

hello to the homedebtors (unless you own the property free and clear of a mortage, you are just renting from the bank), those living debt free can ignore this post

can you guess to which country the quote below refers? think carefully now, BOT lowered rates, food and oil inflation up so somchai needs more loans to pretend to be hi-so, rising NPLs and consumer debt to keep up appearances, oversupply growing.....

Thailand? US? UK? all of the above?

"Inflation created the false impression in many people's minds that housing values could only go up. As happened in the past, speculators started buying houses as an investment, figuring they would turn them over in a few months. Lenders started making bad loans to people who normally wouldn't qualify. Inventory eventually exceeded demand."

[Cyberstar]

... so somchai needs more loans to pretend to be hi-so, rising NPLs and consumer debt to keep up appearances ...

But isn't somchai's falling consumer confidence - and reduced spending - part of the "crisis"?

[oldhand]

Gents,

It appears to me that we are over complicating a fairly simple system.

There are 2 major differences here (and I don't want to start a discussion on what you should do!)

1. If you are buying in a Thai or company name then there is no requirement whatsoever for you to transfer the money in from abroad or show where it came from.

2. If you are eligible for Foreign ownership of your condo (you are not eligible for land - full stop {unless you have millions of dollars to play with}) then you are required to prove that the money has come into Thailand in foreign currency. Transfering it in THB from any location in the world is not going to work! It must be exchanged in Thailand and will therefore be exchanged at the (currently) much more favourable onshore rate. It does not matter if you transfer it to the developers bank or your own, you will be able to prove that it was exchanged from foreign currency. Make sure that if it is transferred direct to the developer then it was sent in your name! Don't send it from your Mum / Sister etc. If you send it to your own account in Thailand then it does not matter who sent it!

One other point that you should note.

It is possible to obtain a Tor Tor 3 from a currency exchange if you change enough. It only requires enough cash.

Please don't try to make it any harder than it is!

K

[pkrv]

Gents,

It appears to me that we are over complicating a fairly simple system.

There are 2 major differences here (and I don't want to start a discussion on what you should do!)

1. If you are buying in a Thai or company name then there is no requirement whatsoever for you to transfer the money in from abroad or show where it came from.

2. If you are eligible for Foreign ownership of your condo (you are not eligible for land - full stop {unless you have millions of dollars to play with}) then you are required to prove that the money has come into Thailand in foreign currency. Transfering it in THB from any location in the world is not going to work! It must be exchanged in Thailand and will therefore be exchanged at the (currently) much more favourable onshore rate. It does not matter if you transfer it to the developers bank or your own, you will be able to prove that it was exchanged from foreign currency. Make sure that if it is transferred direct to the developer then it was sent in your name! Don't send it from your Mum / Sister etc. If you send it to your own account in Thailand then it does not matter who sent it!

One other point that you should note.

It is possible to obtain a Tor Tor 3 from a currency exchange if you change enough. It only requires enough cash.

Please don't try to make it any harder than it is!

K

I fully concur excellent post - Will overpay the developer (because I will not know what to send) but have sufficient trust that this will be resolved.

[bingobongo]

let me start off with a an appropriate quote in reference to the Thai housing market:

All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident.

- Arthur Schopenhauer, (1788 - 1860)

Home-building market to drop 25%

http://thailand-property-guide.com/?p=news...&NewsID=511

[jumnien]

I pray you are right Khun Bongo; I fear you are not.

[lannarebirth]

let me start off with a an appropriate quote in reference to the Thai housing market:

All truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident.

- Arthur Schopenhauer, (1788 - 1860)

Home-building market to drop 25%

http://thailand-property-guide.com/?p=news...&NewsID=511

Let me share another great quote with you:"News is for suckers"-Joseph Granville

Edited August 8, 2007 by lannarebirth

[shochu]

Although oldhand means well, I will say this for the last time here - it is not fully accurate.

1) It does not matter how much money is transfered in at one time although it should be enough to not be a hassle. For instance - if one travels frequently out of the country, in particular my country where I live here in asia - then I am allowed to transfer less than US10,000 without it being recorded - every time I venter out of the country - which to me is not such a bad thing.

2) It does not matter if the money is transfered in another currency or thai baht. With me - I have to transfer into baht first as it can not be done in thailand.

All that matters is that you keep things consistent so that when you go to your bank for the letter you can show them all the bank transfer receipts from your bank where you live and the title which should mention that the funds are being transfered for the purchase of a particular unit. The names of the accounts - if you are transfering from your account overseas to your account in thailand should bear the same name - or at least the account name from where the funds are being transfered.

I recieved all this info from the person directly in charge of overseas transfers at bangkok bank.

Edited August 8, 2007 by shochu

[pkrv]

Although oldhand means well, I will say this for the last time here - it is not fully accurate.

1) It does not matter how much money is transfered in at one time although it should be enough to not be a hassle. For instance - if one travels frequently out of the country, in particular my country where I live here in asia - then I am allowed to transfer less than US10,000 without it being recorded - every time I venter out of the country - which to me is not such a bad thing.

2) It does not matter if the money is transfered in another currency or thai baht. With me - I have to transfer into baht first as it can not be done in thailand.

All that matters is that you keep things consistent so that when you go to your bank for the letter you can show them all the bank transfer receipts from your bank where you live and the title which should mention that the funds are being transfered for the purchase of a particular unit. The names of the accounts - if you are transfering from your account overseas to your account in thailand should bear the same name - or at least the account name from where the funds are being transfered.

I recieved all this info from the person directly in charge of overseas transfers at bangkok bank.

Perhaps I have made an error; I am legitimately looking to reduce the costs on an International FX transfer full stop.

[thaigene2]

I would suspect that as every man and his dog become aware they will milk this for all it's worth. It is why transparency in the FX market is paramount.

Yep. And I wonder what the news reports will look like after the house of cards collapses on the present consumer society goldrush? Especially in the US. Let me guess the US headlines 'shock drop in currency' or 'americans bankrupt - Fed reacts with belt-tightening' or 'job losses grow, mortgage rates rise, foreclosures loom'.

In Thailand are the headlines like this?

"Foreigners drag down Thai economy"

"Foreign property speculators deal blow to honest Thai Companies"

"Call for action against foreign landlords of Thai condos"

"Thai condo landlords revolt - foreigners to blame"

Yes, I know - more speculation. So what - this forum is full of the opposite nonsense!

[pkrv]

I would suspect that as every man and his dog become aware they will milk this for all it's worth. It is why transparency in the FX market is paramount.

Yep. And I wonder what the news reports will look like after the house of cards collapses on the present consumer society goldrush? Especially in the US. Let me guess the US headlines 'shock drop in currency' or 'americans bankrupt - Fed reacts with belt-tightening' or 'job losses grow, mortgage rates rise, foreclosures loom'.

In Thailand are the headlines like this?

"Foreigners drag down Thai economy"

"Foreign property speculators deal blow to honest Thai Companies"

"Call for action against foreign landlords of Thai condos"

"Thai condo landlords revolt - foreigners to blame"

Yes, I know - more speculation. So what - this forum is full of the opposite nonsense!

thaigene2 - you are pretty bloody fast on the uptake. I never, ever, read the news on my country except if its foreign news, from foreign sources about my own county, i.e. in my case The UK. The strategy has served me well.

[jackr]

I have unfortunately heard stories that the offshore rate can be applied (but this is what happens when Transparency is broken). I am not saying they are true or false I am just exercising due diligence. And as I can look into the market, I too know rates that are applied.

I must apologise I become highly dyslexic when thinking, from past experience I know this causes problems as I am working through things. See above correction - to my past post.

Even if you transfer to the developers bank instead of your own, just make sure that you do the transfer in the senders (your) currency (ie pounds). As long as you do in writing or online where you can print , there can't be any problems as the money will come to Thailand in foreign currency. I have never seen a bank here try to exchange using an offshore rate when they receive foreign currency. You could try and get something in writing from the developer or their bank stating transfer will be in pounds and they confirm onshore rate used.

cmsally - thanks for this. To be honest my options come down to these few points:

1) Direct transfer of Sterling to the developers account - who knows the rate, the charges etc I will have to over send. So much for the concept of the Foreign Exchange Transaction Form, mind you I could see how that could be used.

2) World First (my broker) cannot help - they also will not do a sterling transfer.

3) Sterling Transfer from Nationwide (to the developer) - Nationwide do not trade in THB.

4) Open a London and Bangkok Branch of Bangkok Bank - working on this - to give me more options. They are a correspondent bank see link.

http://www.thaivisa.com/forum/index.php?showtopic=133023

But that is about it.

Never had a problem SWIFTing Sterling from HSBC or Halifax. Usually 20 pound (or less) charge UK end and 500 baht Thai end.

Take care mate. The fees are irrelevant it is the rate that counts. I could be charged 1m THB if I make an error. That is how bad it is. Out of interest is there a recourse for any banking 'error' in Thailand, (sorry I am seeking more ammunition).

So tell them to transfer in pounds

Transfered again this week as above and no worries.

[pkrv]

jackr - I understand. Perhaps if lay out my situation it would assist in the THB strength / condo impact.

What should happen is that I fly over to Bangkok and inspect the property, if happy execute an FX trade from anywhere in the world, a crisp exact amount arrives to the developer, contracts cleanly for filled (and at a rate/fee I agree to), and documentation produced.

What is going to happen is more like the following:

1) Before flying over execute a non standard, relatively large, pure sterling trade, which will set off money laundering alarm bells left right and centre, please bare in mind that I work with one of the two systems that transacts almost all global FX trade

2) The developer will be paid before I have inspected. (Not really a problem for me they are very good).

3) I will have to alert the developer that I will over send. I can see the day rate but cannot predict the rate in say 2-3 days time.

4) In order to cover my ass - I will have to alert the developer that if the wrong rate (that I will not be given the opportunity to agree to, regardless of it being right or wrong) is applied (despite my best efforts) there will be a 1m THB shortfall and that we will have to work together to clear the mess up. A contingency must also be put in place to handle this should things go very wrong, so that I can complete my contractual obligations.

I'm afraid this is not clean, this is not tidy, and this is a bloody mess.

Edited August 9, 2007 by pkrv

[highdiver]

The Pethouse in the river project was sold last week for nearly 5 million Usd.

the baht is getting stronger condos are being sold and only one guy can not afford to get in the game.

its the same guy that sold a year ago and lost all that great marlet rise

[jackr]

jackr - I understand. Perhaps if lay out my situation it would assist in the THB strength / condo impact.

What should happen is that I fly over to Bangkok and inspect the property, if happy execute an FX trade from anywhere in the world, a crisp exact amount arrives to the developer, contracts cleanly for filled (and at a rate/fee I agree to), and documentation produced.

What is going to happen is more like the following:

1) Before flying over execute a non standard, relatively large, pure sterling trade, which will set off money laundering alarm bells left right and centre, please bare in mind that I work with one of the two systems that transacts almost all global FX trade

2) The developer will be paid before I have inspected. (Not really a problem for me they are very good).

3) I will have to alert the developer that I will over send. I can see the day rate but cannot predict the rate in say 2-3 days time.

4) In order to cover my ass - I will have to alert the developer that if the wrong rate (that I will not be given the opportunity to agree to, regardless of it being right or wrong) is applied (despite my best efforts) there will be a 1m THB shortfall and that we will have to work together to clear the mess up. A contingency must also be put in place to handle this should things go very wrong, so that I can complete my contractual obligations.

I'm afraid this is not clean, this is not tidy, and this is a bloody mess.

Mai pen rai, pkrv. You're obviously not short of a bob so kick back, positive thoughts and you'll be fine. All the thinking of what can/will go wrong does is give the universe an excuse/energy to balls it up... and a stomach ulcer

[bingobongo]

for those who like pictures, and the application of supply and demand to real estate.......

[bingobongo]

reality can be a real bit@@........but keep building, thats it more oversupply........and more NPLs

Amendments may hurt property

Expanding restrictions on foreign companies to cover management will hurt the country's investment climate, says a property business leader. Longlom Bunnag, the chairman of the real estate agency Jones Lang LaSalle (JLL), said Thailand could be regarded as an ''unfriendly'' country for investors, which might encourage businesses to move to Vietnam or China, which do not place such strict limits on foreign investments.

In the property market, he said that further changing the Foreign Business Act (FBA) without clear implementation details would deter new investors from coming to Thailand.

http://www.bangkokpost.com/Business/10Aug2007_biz38.php