Baht Strengthens- Real Estate Suffers

[chownah]

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.

Don't know but if you could get the contractor to agree to accept a certain number of pounds transfered in a certain time period this would make the transaction clean and give the uncertainty of the FX trade the contractor.

[pkrv]

Don't know but if you could get the contractor to agree to accept a certain number of pounds transfered in a certain time period this would make the transaction clean and give the uncertainty of the FX trade the contractor.

There is a secondary (from my perspective) aspect to this. There are 3, 4 or maybe 5 individuals who are heavily, heavily involved in the building/real-estate business that contribute to this forum. These guys are attempting to run business in Thailand, I am not. I just need a rest. However I do not intend to add to their troubles, which I have seen, they are reasonable guys and I will do all I can to meet my commitments, I think I know how to do this - I will not expose the expletives on the tip of my tongue, but they rhyme with clucking bell…..

[chownah]

Don't know but if you could get the contractor to agree to accept a certain number of pounds transfered in a certain time period this would make the transaction clean and give the uncertainty of the FX trade the contractor.

There is a secondary (from my perspective) aspect to this. There are 3, 4 or maybe 5 individuals who are heavily, heavily involved in the building/real-estate business that contribute to this forum. These guys are attempting to run business in Thailand, I am not. I just need a rest. However I do not intend to add to their troubles, which I have seen, they are reasonable guys and I will do all I can to meet my commitments, I think I know how to do this - I will not expose the expletives on the tip of my tongue, but they rhyme with clucking bell…..

I really don't know what you are trying to say. If it envolves me in any way would you please explain it more clearly and less cleverly?

Chownah

[pkrv]

Don't know but if you could get the contractor to agree to accept a certain number of pounds transfered in a certain time period this would make the transaction clean and give the uncertainty of the FX trade the contractor.

There is a secondary (from my perspective) aspect to this. There are 3, 4 or maybe 5 individuals who are heavily, heavily involved in the building/real-estate business that contribute to this forum. These guys are attempting to run business in Thailand, I am not. I just need a rest. However I do not intend to add to their troubles, which I have seen, they are reasonable guys and I will do all I can to meet my commitments, I think I know how to do this - I will not expose the expletives on the tip of my tongue, but they rhyme with clucking bell…..

I really don't know what you are trying to say. If it envolves me in any way would you please explain it more clearly and less cleverly?

Chownah

Chownah - My direct and unequivocal apology I did not mean to be rude, in any way shape of form. I know that there are others who are impacted (directly or indirectly) by what is happening, which is tricky to say the least.

[thaigene2]

Don't know but if you could get the contractor to agree to accept a certain number of pounds transfered in a certain time period this would make the transaction clean and give the uncertainty of the FX trade the contractor.

There is a secondary (from my perspective) aspect to this. There are 3, 4 or maybe 5 individuals who are heavily, heavily involved in the building/real-estate business that contribute to this forum. These guys are attempting to run business in Thailand, I am not. I just need a rest. However I do not intend to add to their troubles, which I have seen, they are reasonable guys and I will do all I can to meet my commitments, I think I know how to do this - I will not expose the expletives on the tip of my tongue, but they rhyme with clucking bell…..

I really don't know what you are trying to say. If it envolves me in any way would you please explain it more clearly and less cleverly?

Chownah

Chownah - My direct and unequivocal apology I did not mean to be rude, in any way shape of form. I know that there are others who are impacted (directly or indirectly) by what is happening, which is tricky to say the least.

Chownah

I think PKRV is on the record as stating he is a consumer purchaser for his own residence (waiting for completion in a building I won't state) and not a commercial speculator/industry hack. The way I read his comments, is him trying to tell you this..

PKRV - walk down to the Heath, take a deep breath.....and dream of Thailand. How long til your building is complete (or is it finished now?)

[pkrv]

Don't know but if you could get the contractor to agree to accept a certain number of pounds transfered in a certain time period this would make the transaction clean and give the uncertainty of the FX trade the contractor.

There is a secondary (from my perspective) aspect to this. There are 3, 4 or maybe 5 individuals who are heavily, heavily involved in the building/real-estate business that contribute to this forum. These guys are attempting to run business in Thailand, I am not. I just need a rest. However I do not intend to add to their troubles, which I have seen, they are reasonable guys and I will do all I can to meet my commitments, I think I know how to do this - I will not expose the expletives on the tip of my tongue, but they rhyme with clucking bell…..

I really don't know what you are trying to say. If it envolves me in any way would you please explain it more clearly and less cleverly?

Chownah

Chownah - My direct and unequivocal apology I did not mean to be rude, in any way shape of form. I know that there are others who are impacted (directly or indirectly) by what is happening, which is tricky to say the least.

Chownah

I think PKRV is on the record as stating he is a consumer purchaser for his own residence (waiting for completion in a building I won't state) and not a commercial speculator/industry hack. The way I read his comments, is him trying to tell you this..

PKRV - walk down to the Heath, take a deep breath.....and dream of Thailand. How long til your building is complete (or is it finished now?)

October we think - You use the correct terms, I will need to detached myself, I Know this.

[bingobongo]

all together now......when supply is greater than demand.....prices fall......and as the title of this thread, stronger baht is negatiely impacting foreign buyers.....so who will buy up supply? thais? i think not

Market needs more reasons to take off

Elections may not be enough to attract foreign buyers to the Thai property market, says a property expert.

Ian Soo, managing director of Hampdhtons Property, cautions that volatile exchange rates have raised dollar-denodhminated property costs by 10-20% over 12 months and that the stock market's gains mask underlying weaknesses in the Thai economy. These may prevent a full property recovery unless the government acts by reducing property taxes.

''The argument previously was that developers were just going to keep prices the same and will just increase their profit margins, but I don't think they can afford to do that,'' he said. ''They can't hold stock, they want to sell, they have to reduce their prices. The government can really help with this if they reduce the tax the way it did in 2003.''

Mr Soo says foreign demand for Thai property has fallen, while the number of new developments has grown, leading to a possible supply glut.

''So there is a huge vacuum there, and how is that going to be resolved? The only way I can see is lower prices, developers' margins getting squeezed, extra incentives in terms of promotions here, promotions there, and an improving economy overall to bring more of the mid- to high-end buyers in.

Soo: Rental rates off 10% this year

''Unless you get a combination of those factors I don't think anything is going to happen. If anything, prices show signs that they are declining and I think that if we don't see any significant changes fundamentally ... you will see prices decrease.''

However Mr Soo noted that budget condominiums are unlikely to be hurt because even though they are not cheaper in absolute terms, there are more people who can afford to borrow money and buy such units. ''Just talking about 1-3 million baht, hundreds of thousands if not millions of people can buy, but once you talk about 6-25 million baht, how many people can afford that?''

Also the foreign money component is much more important in the mid- to high-end bracket; there are not enough Thais who can afford these properties.

''I should emphasise that while the picture is generally gloomy ... there are still good deals to be had.''

However, investors need to be aware that rental rates have dropped, even in good buildings _ ''I would say about 10% in the last eight months.''

Hamptons has seen rental returns averaging 5.5% to 7% for freehold property and up to 10% for leasehold. Two-bedroom apartments are the most popular in the rental market.

In terms of sales, units of 90 to 130 square metres are in demand and these are mainly two-bedroom units.

Mr Soo advises landlords and sellers to be price competitive. His agency has rejected many listings simply because they are overpriced. ''We have to make sure the prices are correct, otherwise we won't do any business.''

Among the good units Hamptons has sold in the current buyers' market are Sky Villa at The Ascott Bangkok, Avenue 61, Hampton Thonglor and AP Citismart. The agency also sold a unit at The Met for one million baht less than what the owner paid for it. ''They priced it so that they could sell it. It got sold in a day _ there were loads of people queuing up to buy it.''

Mr Soo is watching new projects in the Bang Na area with great interest, especially those stretches that will be linked to the skytrain extension to Sudhkhumvit 107. ''I think once the skytrain is finished not just foreigners but Thais also will be prepared to live along those routes because it won't increase your travelling time very much.''

However, he cautioned that it is difficult to predict what price ranges will be in most demand. ''But it's inevitable that population will spread out and be willing to live farther away as long as they are serviced by mass transport.''

British-born Mr Soo also warned Thais to be wary of advertisements for land in the UK. ''Look at the small print, have they got permits to do this, or awaiting approval? What happens if you pay and then you don't get approval?''

http://www.bangkokpost.com/Yourmoney/13Aug2007_money08.php

Edited August 13, 2007 by bingobongo

[bingobongo]

more pain is coming......

Property market slowing sharply

The property market slowed sharply in the second quarter, with new land registrations down more than 50% from the same period last year , said the latest data from the Bank of Thailand.

New housing starts and property transactions also slowed due to weak consumer confidence and uncertainties over mass-transit expansion plans. New property registrations in Greater Bangkok fell 30.9% year-on-year in May, with single-home registrations off 19.7% and condos and apartments down 52.2%.

http://www.bangkokpost.co.th/topstories/to...s.php?id=120849

[palm]

more pain is coming......

Property market slowing sharply

The property market slowed sharply in the second quarter, with new land registrations down more than 50% from the same period last year , said the latest data from the Bank of Thailand.

New housing starts and property transactions also slowed due to weak consumer confidence and uncertainties over mass-transit expansion plans. New property registrations in Greater Bangkok fell 30.9% year-on-year in May, with single-home registrations off 19.7% and condos and apartments down 52.2%.

http://www.bangkokpost.co.th/topstories/to...s.php?id=120849

Maybe if good quality condos fall from say 15m to 1.5m you'll finally be able to buy one.

For someone who doesn't own anything here and wouldn't buy anyway, you sure do post a lot on the real estate market. . . does it make you feel better thinking the prices of properties you can't afford could go down a bit? If they go up, will it wind you up even more?

Meanwhile, after 8 months of asking, I'm still waiting for anyone to post factual examples of prime condo prices falling in Bangkok, even despite the strong baht. Be sure to let those of us wishing to buy more property here when that magical bargain time will happen.

[thaigene2]

...after 8 months of asking, I'm still waiting for anyone to post factual examples of prime condo prices falling in Bangkok, even despite the strong baht. Be sure to let those of us wishing to buy more property here when that magical bargain time will happen.

Here you go.

2 Bed Condo - Bht 1.35 Reduced!

Category: Homes/Apts For Sale

Area: Central

City: Bangkok, Sri Nakarin Road. Bangna

Telephone: 081-831-7326

Description: Newly decorated 2 bed condo Sri Nakarin Road. Bangna. PRICE REDUCED AGAIN FOR QUICK SELL! NOW JUST BHT 1.35M Price: 1,350,000 Baht

Source: Baht and Sold - http://www.bahtsold.com/detail.php?id=21271

Ladprao 60 - 1 bedroom, 60 sqm Reference: 1668

60 Sq M 1 bed apartment. Fully re-furbished and furnished. Ideal investment. Will rent or sell, price REDUCED 29th June!!! AUD 74,137

http://www.bangkokpropertyagents.com/index...arch&type=0

Price Reduced April 2007!Luxury villa for sale in most prestigious Bangkok golf club (not a 'condo' - I agree)

http://www.holt-realty.com/propview.php?co...e%5B%5D=default

[midas]

...after 8 months of asking, I'm still waiting for anyone to post factual examples of prime condo prices falling in Bangkok, even despite the strong baht. Be sure to let those of us wishing to buy more property here when that magical bargain time will happen.

Here you go.

2 Bed Condo - Bht 1.35 Reduced!

Category: Homes/Apts For Sale

Area: Central

City: Bangkok, Sri Nakarin Road. Bangna

Telephone: 081-831-7326

Description: Newly decorated 2 bed condo Sri Nakarin Road. Bangna. PRICE REDUCED AGAIN FOR QUICK SELL! NOW JUST BHT 1.35M Price: 1,350,000 Baht

Source: Baht and Sold - http://www.bahtsold.com/detail.php?id=21271

Ladprao 60 - 1 bedroom, 60 sqm Reference: 1668

60 Sq M 1 bed apartment. Fully re-furbished and furnished. Ideal investment. Will rent or sell, price REDUCED 29th June!!! AUD 74,137

http://www.bangkokpropertyagents.com/index...arch&type=0

Price Reduced April 2007!Luxury villa for sale in most prestigious Bangkok golf club (not a 'condo' - I agree)

http://www.holt-realty.com/propview.php?co...e%5B%5D=default

palm is like a broken record

maybe these examples will shut him up for a while

[calibanjr.]

...after 8 months of asking, I'm still waiting for anyone to post factual examples of prime condo prices falling in Bangkok, even despite the strong baht. Be sure to let those of us wishing to buy more property here when that magical bargain time will happen.

Here you go.

2 Bed Condo - Bht 1.35 Reduced!

Category: Homes/Apts For Sale

Area: Central

City: Bangkok, Sri Nakarin Road. Bangna

Telephone: 081-831-7326

Description: Newly decorated 2 bed condo Sri Nakarin Road. Bangna. PRICE REDUCED AGAIN FOR QUICK SELL! NOW JUST BHT 1.35M Price: 1,350,000 Baht

Source: Baht and Sold - http://www.bahtsold.com/detail.php?id=21271

Ladprao 60 - 1 bedroom, 60 sqm Reference: 1668

60 Sq M 1 bed apartment. Fully re-furbished and furnished. Ideal investment. Will rent or sell, price REDUCED 29th June!!! AUD 74,137

http://www.bangkokpropertyagents.com/index...arch&type=0

Price Reduced April 2007!Luxury villa for sale in most prestigious Bangkok golf club (not a 'condo' - I agree)

http://www.holt-realty.com/propview.php?co...e%5B%5D=default

palm is like a broken record

maybe these examples will shut him up for a while

Keep dreaming!

Palm, highdiver, ...(you know the list) they are relentless! Keeps me entertained!

[bingobongo]

the song "tiny bubbles" from Don Ho comes to mind.....and the genius part is that they keep adding more supply thereby driving prices down even further.......economics lessons should be mandatory for all.......

fools and their money will soon be separated

Slowdown hits developers in Q2

The Nation: 15 August 2007

Most listed property developers have posted disappointing second-quarter earnings in a sign that consumers have delayed their home-buying decisions amid the economic slowdown and political uncertainty.

http://thailand-property-guide.com/?p=news...&NewsID=527

Edited August 15, 2007 by bingobongo

[pkrv]

...after 8 months of asking, I'm still waiting for anyone to post factual examples of prime condo prices falling in Bangkok, even despite the strong baht. Be sure to let those of us wishing to buy more property here when that magical bargain time will happen.

Here you go.

2 Bed Condo - Bht 1.35 Reduced!

Category: Homes/Apts For Sale

Area: Central

City: Bangkok, Sri Nakarin Road. Bangna

Telephone: 081-831-7326

Description: Newly decorated 2 bed condo Sri Nakarin Road. Bangna. PRICE REDUCED AGAIN FOR QUICK SELL! NOW JUST BHT 1.35M Price: 1,350,000 Baht

Source: Baht and Sold - http://www.bahtsold.com/detail.php?id=21271

Ladprao 60 - 1 bedroom, 60 sqm Reference: 1668

60 Sq M 1 bed apartment. Fully re-furbished and furnished. Ideal investment. Will rent or sell, price REDUCED 29th June!!! AUD 74,137

http://www.bangkokpropertyagents.com/index...arch&type=0

Price Reduced April 2007!Luxury villa for sale in most prestigious Bangkok golf club (not a 'condo' - I agree)

http://www.holt-realty.com/propview.php?co...e%5B%5D=default

thaigene2 you have a wicked sense of humour

[think_too_mut]

...after 8 months of asking, I'm still waiting for anyone to post factual examples of prime condo prices falling in Bangkok, even despite the strong baht. Be sure to let those of us wishing to buy more property here when that magical bargain time will happen.

Here you go.

2 Bed Condo - Bht 1.35 Reduced!

Category: Homes/Apts For Sale

Area: Central

City: Bangkok, Sri Nakarin Road. Bangna

Telephone: 081-831-7326

Description: Newly decorated 2 bed condo Sri Nakarin Road. Bangna. PRICE REDUCED AGAIN FOR QUICK SELL! NOW JUST BHT 1.35M Price: 1,350,000 Baht

Source: Baht and Sold - http://www.bahtsold.com/detail.php?id=21271

Ladprao 60 - 1 bedroom, 60 sqm Reference: 1668

60 Sq M 1 bed apartment. Fully re-furbished and furnished. Ideal investment. Will rent or sell, price REDUCED 29th June!!! AUD 74,137

http://www.bangkokpropertyagents.com/index...arch&type=0

Price Reduced April 2007!Luxury villa for sale in most prestigious Bangkok golf club (not a 'condo' - I agree)

http://www.holt-realty.com/propview.php?co...e%5B%5D=default

thaigene2 you have a wicked sense of humour

Whoever advertised in today's BKK post properties in Hua Hin, had that same kink. Discounts. They probably know their sale is worth zero...and went to the length to advertise in BKK Post.

And it's probably worth half of the "discounted" prices. If anyone would buy it at any (low) price.

[thaigene2]

Whoever advertised in today's BKK post properties in Hua Hin, had that same kink. Discounts. They probably know their sale is worth zero...and went to the length to advertise in BKK Post.

And it's probably worth half of the "discounted" prices. If anyone would buy it at any (low) price.

Yep - You may also have noticed this guy who's been advertising in Bangkok Post a condo for 5,895,000 (or close to that) for a condo in a development out by Concordia School. That ad has been running for at least a year - maybe two. EVERYDAY in the bangkok post (has a bloody photo too!)- how much does THAT cost!! I rang the guy once and(Dutch or Belgian accent). Incredible. Rich obviously...it was his place - not an agent. Didn't seem to care really..

So in a sense that makes the argument of these other guys - I know..."there are people with lots of money who simply don't give a sh+t." Still, how smart can you be to have some joint on the outskirts that you can't shake off - and you're spending 2 or 3 HUNDRED-THOUSAND-BAHT a year to advertise...(it's a big ad - as I said with a photo too - looks ok - why hasn't it sold?)

Clearly this guy isn't going to drop his price cause he doesn't care...instead he's going to spend more and more on advertising until one day it sells. Makes no sense to me - but maybe that's why he's rich and I'm not..(oh yes, quote that. ya da ya da.....)

[pkrv]

Whoever advertised in today's BKK post properties in Hua Hin, had that same kink. Discounts. They probably know their sale is worth zero...and went to the length to advertise in BKK Post.

And it's probably worth half of the "discounted" prices. If anyone would buy it at any (low) price.

Yep - You may also have noticed this guy who's been advertising in Bangkok Post a condo for 5,895,000 (or close to that) for a condo in a development out by Concordia School. That ad has been running for at least a year - maybe two. EVERYDAY in the bangkok post (has a bloody photo too!)- how much does THAT cost!! I rang the guy once and(Dutch or Belgian accent). Incredible. Rich obviously...it was his place - not an agent. Didn't seem to care really..

So in a sense that makes the argument of these other guys - I know..."there are people with lots of money who simply don't give a sh+t." Still, how smart can you be to have some joint on the outskirts that you can't shake off - and you're spending 2 or 3 HUNDRED-THOUSAND-BAHT a year to advertise...(it's a big ad - as I said with a photo too - looks ok - why hasn't it sold?)

Clearly this guy isn't going to drop his price cause he doesn't care...instead he's going to spend more and more on advertising until one day it sells. Makes no sense to me - but maybe that's why he's rich and I'm not..(oh yes, quote that. ya da ya da.....)

I believe the term is eccentric

[donx]

thaigene2,

Do you really think that the two condos you showed are examples of prime condos? One is less than 2 million baht in Bangna and the other is slightly more that 2 million baht in Ladprao. Those are not what I would consider to be prime locations. I agree that there are probably examples of prime condos being reduced in price. I simply disagree that you have provided such an example. How about finding condos in the Central Business District where the price is/was over 5 million baht.

[cmsally]

There are lots of bargains around Ladprao and Bangna; but try finding the same thing in Patumwan, Sukhumvit (close to BTS).

2.5m minimum for a studio and I looked pretty thoroughly.

[thaigene2]

Donx and cmsally,

You both have reasonable questions. To be honest, I just Googled "bangkok, price reduced" and that's what came up. However, Marc Holt has been the most honest realtor/esate agent I've seen so far in responding to an absolutely f+cked market here. (search for his posts).

Whilst I'd agree that the examples above aren't Ploen Chit or Soi Langsuan I think that's a bit pedantic. So what? Do you really think the US Sub-prime collapse won't ripple UP the chain? And not here too? It's not the US market is stupid (well maybe) but rather that easy credit has blinded people to the realities of life.

What I wish I did have was the ability to search in thai (most of the condos are empty and bought by Thai speculators) - cmsally can you do that? I'd like to see if there is any distress in the Thai speculator's market..and I know you are a pro in buying/selling here...

[jasreeve17]

Donx and cmsally,

You both have reasonable questions. To be honest, I just Googled "bangkok, price reduced" and that's what came up. However, Marc Holt has been the most honest realtor/esate agent I've seen so far in responding to an absolutely f+cked market here. (search for his posts).

Whilst I'd agree that the examples above aren't Ploen Chit or Soi Langsuan I think that's a bit pedantic. So what? Do you really think the US Sub-prime collapse won't ripple UP the chain? And not here too? It's not the US market is stupid (well maybe) but rather that easy credit has blinded people to the realities of life.

What I wish I did have was the ability to search in thai (most of the condos are empty and bought by Thai speculators) - cmsally can you do that? I'd like to see if there is any distress in the Thai speculator's market..and I know you are a pro in buying/selling here...

I've said it before on other threads; there are considerable discounts from the Thai banks on their properties. Selling under the land office valuations (a big statement in itself). My missus just got a couple of apartments nice and cheaply, and the prices are coming down further.

OK these are Thai areas (Pinklao) and prices under a million. But, this is Thailand and the Thai people and banks should have a good idea of what direction their property market is heading in.

Forigners paying top dollar for off plan apartments in central BKK are insane. Having enough money to pay over the market value is fine if you can, but don't tell everyone else that it's a buoyant market. It is not.

Edited August 18, 2007 by jasreeve17

[thaigene2]

Thanks Jasreeve17

That's what i thought.. Is your wife worried about re-sale, or does she thiknk she can rent at an increased profit given fuiture transport links there in Pinklao?

Still wonder about the Thai speculators in the centrally and Srinakarindra located places though... they worried? I see a LOT of empty places in finished buildings owned by thais, not farangs and they are either for sale or for rent. And HEY..Noble and Sansiri are building MORE off plan - any takers?

TG2

[cmsally]

The banks have very little in the central areas but there are properties further out.

The ones that come up for auction are normally bid up by people who know their value and if they don't get a good price the banks will withdraw. I had thought about researching prospective transport links and maybe buying something that could appreciate as long as a good deal, but don't have much time to do the groundwork at the moment.

Bangkok Bank have a good section for this - they have properties that are up for sale with no auction - they have done all the legal work of getting occupiers out etc. From what I have heard prices they are asking can be negotiable.

From searching the Thai websites I have been very surprised that Thai speculators have not tried to sell more and at knock down prices with the economy going downhill.

A good indication is projects that are ready for transfer such as Ban Klang Krung. There are a few units for sale but prices are between 79,000-90,000Bt/m2 Not exactly cheap.

In the project I bought into, as far as I can see on the websites there are only I think ,3 units up for resale and not at a cheap price. Transfer is supposed to be Dec. but probably beginning of next year.

[chownah]

OK these are Thai areas (Pinklao) and prices under a million. But, this is Thailand and the Thai people and banks should have a good idea of what direction their property market is heading in.

:: ::

[jasreeve17]

OK these are Thai areas (Pinklao) and prices under a million. But, this is Thailand and the Thai people and banks should have a good idea of what direction their property market is heading in.

: : : :

[jasreeve17]

The banks have very little in the central areas but there are properties further out.

The ones that come up for auction are normally bid up by people who know their value and if they don't get a good price the banks will withdraw. I had thought about researching prospective transport links and maybe buying something that could appreciate as long as a good deal, but don't have much time to do the groundwork at the moment.

Bangkok Bank have a good section for this - they have properties that are up for sale with no auction - they have done all the legal work of getting occupiers out etc. From what I have heard prices they are asking can be negotiable.

From searching the Thai websites I have been very surprised that Thai speculators have not tried to sell more and at knock down prices with the economy going downhill.

A good indication is projects that are ready for transfer such as Ban Klang Krung. There are a few units for sale but prices are between 79,000-90,000Bt/m2 Not exactly cheap.

In the project I bought into, as far as I can see on the websites there are only I think ,3 units up for resale and not at a cheap price. Transfer is supposed to be Dec. but probably beginning of next year.

This is not my recent experience. & we looked in detail.

We got two properties; one in a "grand sale" where prices were dropped over 10% to below land office valuations. The other property (next door) was not in the grand sale and so we made an offer of 10% under the asking price. They didn't accept the offer and asked for 1.5k more, which was still under the land office valuation. In fact we had to take people from the bank to the land office to prove that the price we said we paid was the real one.

What is central? On Suk and Silom the prices are higher, but most people wouldn't want to live there once they've been in Thailand for a couple of years. I'd consider Pinklao quite central and a better location in many ways.

Bangkok has an unusual accom spread and the word "central" is not really as true here, as it might be in say London or New York. IMHO.

[jasreeve17]

Thanks Jasreeve17

That's what i thought.. Is your wife worried about re-sale, or does she thiknk she can rent at an increased profit given fuiture transport links there in Pinklao?

Still wonder about the Thai speculators in the centrally and Srinakarindra located places though... they worried? I see a LOT of empty places in finished buildings owned by thais, not farangs and they are either for sale or for rent. And HEY..Noble and Sansiri are building MORE off plan - any takers?

TG2

TG,

Resale is not a problem for her as she sold some land in the country ("Bad" land in the middle of a pig farm. The value has been rising very slowly, if at all.) and the property in Bangkok will be a better investment over, say, a 15 year period. Also we will live in it as my work is close by.

As for Pinklao, and Thonburi in general, it has many good points, and with the new BTS and MRT links it'll be very convienient too. An "up and coming" area.

I think that most rational people realise that the "central" area is massively over stocked with new high end apartments. And they are building more. Many won't get completed in my opinion. An example is a nice block by me in PhraKanong (OK, not too central) but a huge "Japanese built quality condo"... One is complete and people are living in it, the one by the side is a shell and likely to stay that way - no work done for the last 5 months...

I would never buy off plan in this country. I'm just not rich enough to lose a multi million baht investment, and I consider the risk of a 100% loss to be quite high.

[bingobongo]

common sense would dictate less building when there is oversupply, but given the oversupply and liquidity.........build more.......genius I tell you, pure genius....

one more time, all together now, when supply is greater than demand, prices go down........i love the sales pitch from the developers......genius again

High-end projects still have potential despite speculation

''In the condominium market, units that are priced between one million and 1.5 million baht are witnessing an oversupply, which can be scary for the overall market,'' Mr Adisorn said.

Mr Chen's views reflected recent data released by the Bank of Thailand that showed the property market slowed during the second quarter of this year, with new land registrations down more than 50% from the same period last year.

The central bank said property transactions also slowed due to weak consumer confidence and uncertainty over mass-transit expansion plans. New property registrations in Greater Bangkok fell 30.9% year-on-year in May

http://www.bangkokpost.com/Business/20Aug2007_biz30.php

[Jai Dee]

Flame comments have been deleted.

Next time it happens a suspension from the forum will be awarded.

[fletchsmile]

common sense would dictate less building when there is oversupply, but given the oversupply and liquidity.........build more.......genius I tell you, pure genius....

one more time, all together now, when supply is greater than demand, prices go down........i love the sales pitch from the developers......genius again

High-end projects still have potential despite speculation

''In the condominium market, units that are priced between one million and 1.5 million baht are witnessing an oversupply, which can be scary for the overall market,'' Mr Adisorn said.

Mr Chen's views reflected recent data released by the Bank of Thailand that showed the property market slowed during the second quarter of this year, with new land registrations down more than 50% from the same period last year.

The central bank said property transactions also slowed due to weak consumer confidence and uncertainty over mass-transit expansion plans. New property registrations in Greater Bangkok fell 30.9% year-on-year in May

http://www.bangkokpost.com/Business/20Aug2007_biz30.php

You've obviously picked up a few basic economic theories when I look at all your posts on this thread. Yes as a general rule if supply exceeds demand prices will fall. What you say may hold true for much of the market, particularly the lower end. But there are a fair few gaps in your statements: You've missed out the bit about a "perfect market" being part of these theories, which Thailand obviously isn't. There are also barriers to entry (and exit). There is not one market but many sub-markets. The high-end / luxury market is different. Luxuries are not as price elastic, and for certain products even, the more expensive they are then the more sought after they are, i.e prestige. Don't forget wealth concentrations, in that much of Thailand's high end wealth (and property) is in a few small hands.

So while I'd agree the mid-low end may have issues. I'd also agree that "High-end projects still have potential despite speculation". BTW 1.5mio is not "high-end" in my view.

On the higher end - let's say THB 10mio+ or THB 100k/ m2, below are just some of the following factors which will come into play in the Thai market to lend support:

- Supply in this bracket for CBD is limited long term. There is only so much space in CBD. There is only one of Bangkok and only one of Sathorn, (lower) Sukhumvit and Silom. Sure there are substitutes in the suburbs for other areas, but these are not substitutes for the central areas at the heart of Bangkok

- Buyers in these high end markets are not middle class Thais and definitely not low class. They are wealthier Thais or foreigners, i.e international players. They have money to spend. They compete with each other internationally. Not Somchai the moto taxi guy

- Wealthy Thais often hate to sell or rent at a loss. They would rather their property was empty, or wait for prices to rise before selling. This maintains more of a floor than normal in other "perfect" markets. Logical? Maybe not in your eyes. But given a choice between losing face or losing money a Thai answer will not alwys be the same as whiteys like yourself. Of course Somchai living hand to mouth, needs to sell or drop his price on his low end pad when things take a downturn. These rich guys can ride it out tho'.

- Buyers in these markets also consider other Asian capitals, eg Singapore, HK, Tokyo, as well as other global capitals eg London, Sydney. In comparison to other cities, for prime CBD area, Bangkok is cheap. i.e as far as international money is concerned BKK is cheap

- Quality condos in Singapore start at SGD 1mio up. That's THB 20mio up. That market is booming at the moment. Once it becomes too high people will look for alternatives. THB10mio is a bargain. THB10 mio would just about buy a garden shed in London (if you could afford a garden).

- Infrastructure is being upgraded all the time in BKK. Skytrain, Underground, BRT. This will make the city more desireable in the future to international demand

- GDP growth in Thailand once the current political situation passes smoothly, means wage growth and growth generally will exceed developed countries'. That's increase in local demand, as well as international demand.

- How many people are there in US, UK, Germany, France, Japan, Scandanavia, Switzerland etc. Add in similar countries and around a billion. To all these people Thailand is cheap. There have been more and more people coming to live in Thailand in the last 20 years. The trend will continue. Indians, Chinese are growing in wealth. Their elite will also spread their wings to other capitals.

- mortgage markets are gradually opening up if you look at the long term picture. eg much easier now than a few years ago for a foreigner to get a mortgage in their own name. eg BKK Bank Singapore, UOB Singapore didn't offfer a service 10 years ago

- For people with real money. What are the alternatives? Most will always want some part of their portfolio in property. STock markets are volatile at the moment. Rich people want diversification and can afford a long term view. Over a longer time frame, it's not timing in the market that counts but amount of time in the market.

So while there may be something in your gloom and doom analysis for the low end. Be careful not to make wide sweeping assumptions...

Edited August 20, 2007 by fletchthai68