Where Is The Condominium Market In Thailand Going?

[donx]

But I think 30 years down the road, most of the good locations are already occupied, since there are 30-50 new projects being built every year.

In 30 years, there may be computers providing the illusion, structure, electromagnetic floors and moving walls. Not brick and mortar.

think_too_mut: your not mellowing by any chance are you?

It was interesting to note the sheer number of developments on the river, there appears to be a lot going on. But there are other developments too that actually are all IMO really complimentary - Things like new Thai banking practices aimed specifically to assit Ferangs (whilst detering undesirables)

Interesting article in Nation today:

PERSONAL FINANCE

Bank accounts for foreigners

By Ekarin Bumroongpuk

The Nation

Published on June 26, 2008

A look at the qualification criteria at various insititutions and the documents you need

http://www.nationmultimedia.com/2008/06/26...ss_30076519.php

I think Thailand is getting its act together in this whole area, it has infrastructure, the ability to communicate, the best options for the region. One thing that keeps nagging at me is the 49% rule, I think this is now being exploited to Ferangs long term detriment (it differentiates the status of ownership of Thais and ferangs for the same property), but am unsure of Thai long term reaction. (personally I would be pissed off if I owned the same type of unit but it was cheeper because I was a local)

pkrv, it is "farang", not "Ferang". In Thai, cassualy, they say "falang".

Been to Thai before? Thai is a nice place, believe me. Come and see for yourself.

Technical term - Bugger - I had thought I had taught my spell checker the correct version - I am slightly dyslexic - I can't see errors on spelling and get numbers mixed up - but yes I own and have been over frequently, next stop in under 4 weeks you will see the photos!

And no you are not mellowing ];-)

Although Thais don't feel the price differentials are fair, for the most part they are not pissed off. This is because even though their units will be sold for less, they can usually get them for less when they buy. In addition, they see the double pricing for everything in all the farang areas.

As for think_too_mut mellowing...

[think_too_mut]

But I think 30 years down the road, most of the good locations are already occupied, since there are 30-50 new projects being built every year.

In 30 years, there may be computers providing the illusion, structure, electromagnetic floors and moving walls. Not brick and mortar.

think_too_mut: your not mellowing by any chance are you?

It was interesting to note the sheer number of developments on the river, there appears to be a lot going on. But there are other developments too that actually are all IMO really complimentary - Things like new Thai banking practices aimed specifically to assit Ferangs (whilst detering undesirables)

Interesting article in Nation today:

PERSONAL FINANCE

Bank accounts for foreigners

By Ekarin Bumroongpuk

The Nation

Published on June 26, 2008

A look at the qualification criteria at various insititutions and the documents you need

http://www.nationmultimedia.com/2008/06/26...ss_30076519.php

I think Thailand is getting its act together in this whole area, it has infrastructure, the ability to communicate, the best options for the region. One thing that keeps nagging at me is the 49% rule, I think this is now being exploited to Ferangs long term detriment (it differentiates the status of ownership of Thais and ferangs for the same property), but am unsure of Thai long term reaction. (personally I would be pissed off if I owned the same type of unit but it was cheeper because I was a local)

pkrv, it is "farang", not "Ferang". In Thai, cassualy, they say "falang".

Been to Thai before? Thai is a nice place, believe me. Come and see for yourself.

Technical term - Bugger - I had thought I had taught my spell checker the correct version - I am slightly dyslexic - I can't see errors on spelling and get numbers mixed up - but yes I own and have been over frequently, next stop in under 4 weeks you will see the photos!

And no you are not mellowing ];-)

Ok, be better with some basic things and don't blame your spell checker,

To go with your thread, I bought my condo out of my fear I would ever have to step into the shithole called Bangkok again and see stray dogs all over the place. The same stray dogs, no premium dogs at more expensive or more central places.

How is Bang Na worse than BKK City?

[dotcom]

This development is 5 months ahead of schedule, now final contract and payment are 6 months earlier - end of July 2008 instead of January 2009.

May I ask how many sq meter the floorplan?

Thanks

I watched the first I think 3 towers go in behind Makro office. But now it's just crazy in that area. You have a beautiful Foodland store a few km outbound on Srinakarin too!! With partking. We never close.

[pkrv]

But I think 30 years down the road, most of the good locations are already occupied, since there are 30-50 new projects being built every year.

In 30 years, there may be computers providing the illusion, structure, electromagnetic floors and moving walls. Not brick and mortar.

think_too_mut: your not mellowing by any chance are you?

It was interesting to note the sheer number of developments on the river, there appears to be a lot going on. But there are other developments too that actually are all IMO really complimentary - Things like new Thai banking practices aimed specifically to assit Ferangs (whilst detering undesirables)

Interesting article in Nation today:

PERSONAL FINANCE

Bank accounts for foreigners

By Ekarin Bumroongpuk

The Nation

Published on June 26, 2008

A look at the qualification criteria at various insititutions and the documents you need

http://www.nationmultimedia.com/2008/06/26...ss_30076519.php

I think Thailand is getting its act together in this whole area, it has infrastructure, the ability to communicate, the best options for the region. One thing that keeps nagging at me is the 49% rule, I think this is now being exploited to Ferangs long term detriment (it differentiates the status of ownership of Thais and ferangs for the same property), but am unsure of Thai long term reaction. (personally I would be pissed off if I owned the same type of unit but it was cheeper because I was a local)

pkrv, it is "farang", not "Ferang". In Thai, cassualy, they say "falang".

Been to Thai before? Thai is a nice place, believe me. Come and see for yourself.

Technical term - Bugger - I had thought I had taught my spell checker the correct version - I am slightly dyslexic - I can't see errors on spelling and get numbers mixed up - but yes I own and have been over frequently, next stop in under 4 weeks you will see the photos!

And no you are not mellowing ];-)

Ok, be better with some basic things and don't blame your spell checker,

To go with your thread, I bought my condo out of my fear I would ever have to step into the shithole called Bangkok again and see stray dogs all over the place. The same stray dogs, no premium dogs at more expensive or more central places.

How is Bang Na worse than BKK City?

Ahhaahh this is where we differ - We have Sky dogs in Bangkok, not just Soi dogs (I hope I spelt that right) they are SOOOOOO cute - some of them are overfed though, and looking a little rotund.... I finally came to the conclusion that they can teleport. I have never seen one move! Yet when you go back through the same area they have shifted position. Inexplicable.

There is no difference here we are all in this together - admittedly I do not engage in house/land ownership issues but that is because I don't understand them. Your thoughts are deeply appreciated it helps us all build a bigger picture of a very big and diverse city and country! I note dotcom has some input - this IMO is what it is about - strangers in a strange land.

Edited June 27, 2008 by pkrv

[think_too_mut]

This development is 5 months ahead of schedule, now final contract and payment are 6 months earlier - end of July 2008 instead of January 2009.

May I ask how many sq meter the floorplan?

Thanks

I watched the first I think 3 towers go in behind Makro office. But now it's just crazy in that area. You have a beautiful Foodland store a few km outbound on Srinakarin too!! With partking. We never close.

66sqm is ours.

We don't care. It's a holiday home or a fall back if something happens. To live there on the cheap.

Far from my plans, but, just in case.

[pkrv]

According to The Nation a new building phase of condominuims seems to be in the planned stage and prices are predicted to rise for new condominiums.

Could this have a possible knock on effect in the secondary market? This could now start to begin to look very cost effective? (In well run condos). Additionally you would see what you are paying for and get to meet with the in situ juristic people.

http://www.nationmultimedia.com/2008/07/01...ss_30076914.php

I also note the number of developments along the Chao Phraya

http://www.thaivisa.com/forum/Chao-Phraya-...ts-t195556.html

[garrieoz]

Hi Gents,

Does anybody have experience with Omni Tower in Soi 4 or a similar. A 'friend of a friend' is selling a 3 bed 2 bath there on a high floor for a 'good price' of Baht 7.9m fully furnished. I think it is about 119 sq metres. They have offerred to cover all ancilliary costs of me buying.

I have no idea of the current market, and had wanted to do some more research before I bought, but if it is a good deal I don't want to miss out.

Any comments that would help me understand the market would be greatly appreciated.

Cheers,

Gaz

[pkrv]

Welcome to the board.

Here are a couple of estate agents you can try to get your own independent view on prices.

Hamptons (mostly secondary market but some new developments)

http://www.hamptons.co.th/

CBRE (new stuff I think)

http://www.cbre.co.th/cbrecontent/bangkok/...ntial_sales.htm

I note Omni Tower has its own web site (for services apartments) - but you could try searching this board for past comments on the place there is a whole lot of information here!

http://www.agoda.com/asia/thailand/bangkok...residences.html

Edited July 2, 2008 by pkrv

[steveromagnino]

Hi Gents,

Does anybody have experience with Omni Tower in Soi 4 or a similar. A 'friend of a friend' is selling a 3 bed 2 bath there on a high floor for a 'good price' of Baht 7.9m fully furnished. I think it is about 119 sq metres. They have offerred to cover all ancilliary costs of me buying.

I have no idea of the current market, and had wanted to do some more research before I bought, but if it is a good deal I don't want to miss out.

Any comments that would help me understand the market would be greatly appreciated.

Cheers,

Gaz

bulding a bit of a dump; fairly bad soi for Thais, good for foreigners in some respects; building has a bunch of serviced apartments in it....would not have thought too bad at that price, probably low ceiling height, a bit tired, but at under 70,000b per sqm it isn't bad.

[pkrv]

An interesting article in The Nation today

http://www.nationmultimedia.com/2008/07/03...ss_30077121.php

Sales agencies get bullish on resale market

Most of the residential units for resale, including detached houses, townhouses and condominiums, are three to five years old. Thus, their construction cost is lower than new houses that will be built and delivered this year. This is why the prices are lower than the new projects launched this year," he said.

and

n Resale prices for homes are 15 per cent to 20 per cent lower than new projects in the same location.

n Home-buyers of pre-owned homes can avail of the tax incentives in the property sector.

n A total of 70,000 to 80,000 units a year are sold in the residential-resale market.

Though no split out of the condominium figures I'm afraid.

[steveromagnino]

the total supply of new units (condos combined with detached/semi detached housing) hasn't changed in the last 3-4 years; just the split has swung away from houses to condos.

With petrol rising even more, and better mass transit, I can see this likely to continue.

[think_too_mut]

the total supply of new units (condos combined with detached/semi detached housing) hasn't changed in the last 3-4 years; just the split has swung away from houses to condos.

With petrol rising even more, and better mass transit, I can see this likely to continue.

Better Mass Transit is a multi-billion US$ investment. What is in place now is a nice try but still underutilized (the subway I mean). It's all kind of Mickey Mouse transport.

I hate any public transport, the Sky Train is packed, according to some reports here and (to a lesser extent) my own observations.

That is why I ran away from BKK.

No traffic jams, no loss comparable to moving out of Manhattan to New Jersey, just same climate, same people, same shopping malls, same goods. No loss of Broadway, no loss of the Metropolitan, no loss of all that buzz that NY has and other places don't.

Walking distance restaurants - ahem, they are usually concentrated around or within the shopping malls.

Those good ones that are not - they are priced as in the West.

Condos that are being completed now know something and that's why I posted before they were too nice.

Unexpected but nice to see, hope I don't have to run away from my deposit.

[pkrv]

the total supply of new units (condos combined with detached/semi detached housing) hasn't changed in the last 3-4 years; just the split has swung away from houses to condos.

With petrol rising even more, and better mass transit, I can see this likely to continue.

Better Mass Transit is a multi-billion US$ investment. What is in place now is a nice try but still underutilized (the subway I mean). It's all kind of Mickey Mouse transport.

I hate any public transport, the Sky Train is packed, according to some reports here and (to a lesser extent) my own observations.

That is why I ran away from BKK.

No traffic jams, no loss comparable to moving out of Manhattan to New Jersey, just same climate, same people, same shopping malls, same goods. No loss of Broadway, no loss of the Metropolitan, no loss of all that buzz that NY has and other places don't.

Walking distance restaurants - ahem, they are usually concentrated around or within the shopping malls.

Those good ones that are not - they are priced as in the West.

Condos that are being completed now know something and that's why I posted before they were too nice.

Unexpected but nice to see, hope I don't have to run away from my deposit.

Sounds like you are looking to bring up kids? if so they should find plenty of friends and the location sounds about right. I no longer drive. The Sky Train does not remind me of The Tube. I like the Tokyo underground for the same reasons BTW, the adverts you bash your head on as you walk down the center of the carrage (female only carrages were clearly marked!) I like the change in cultures, it can be quite hysterical when you work out why.

Good luck and please tell us what happens. To be honest there were a fair few of us who were pooing our pants/tearing their hair out as various projects came in - We sort of worked openly together. It IMO helped us. Happy to onpass what I/We learned, but quite frankly looking at it I think you are home free.

This is all an interesting Human dynamic to what is going on. We are oddly all getting on with our lives, and Bangkok/Thailand seems to feature. IMO correctly.

[garrieoz]

Hi Gents,

Does anybody have experience with Omni Tower in Soi 4 or a similar. A 'friend of a friend' is selling a 3 bed 2 bath there on a high floor for a 'good price' of Baht 7.9m fully furnished. I think it is about 119 sq metres. They have offerred to cover all ancilliary costs of me buying.

I have no idea of the current market, and had wanted to do some more research before I bought, but if it is a good deal I don't want to miss out.

Any comments that would help me understand the market would be greatly appreciated.

Cheers,

Gaz

bulding a bit of a dump; fairly bad soi for Thais, good for foreigners in some respects; building has a bunch of serviced apartments in it....would not have thought too bad at that price, probably low ceiling height, a bit tired, but at under 70,000b per sqm it isn't bad.

Thanks Steve,

Yes it is a bit dowdy & the place requires a kitchen renovation. I was kind of looking long term. Maybe that Tobacco Factory or even NEP may disappear 5-10 years. Sort of like Soi 10 was gentrified. NEP is certainly a bit of fun for some, but IMHO it does kind of hold the area back.

I could be way off course with this, but I witnessed a similar thing in Singapore. Then again Thailand is a whole different kettle of fish.

Cheers,

liam

[quiksilva]

The area might change but the buildings will get older too. So dont buy condos because you think the area might improve in the future.

If you think a location might improve, you speculate on land, which is not an option for most people here.

[pkrv]

There has been an interesting series of developments in the Condominiums In Rajadamri Road - Ok Or Not? thread regarding leasehold. At the moment we have a 49% quota for Farangs and 51% quota for Thais. It would appear that Thai flippers buy into the Farang quota to ensure success in on selling.

Oddly though it seems that if the condominium is leasehold Farangs can buy 100%. There is no cap.

It looks like a new development Sukhothai almost immediately sold its 49% Farang quota but only about 50% of its Thai quota. Given market forces it may be the remaining Thai quota units could now be sold as leasehold.

I must confess I was always concerned with the market distortion introduced by the 49/51% rule but it would appear that it can now be bypassed legally. A shame IMO that the rule is just not simply scrapped it is causing a mess/sales hurdle, and now serves no purpose.

This development could add a serious impetus to condominium sales in Thailand.

[ray08]

There has been an interesting series of developments in the Condominiums In Rajadamri Road - Ok Or Not? thread regarding leasehold. At the moment we have a 49% quota for Farangs and 51% quota for Thais. It would appear that Thai flippers buy into the Farang quota to ensure success in on selling.

Oddly though it seems that if the condominium is leasehold Farangs can buy 100%. There is no cap.

It looks like a new development Sukhothai almost immediately sold its 49% Farang quota but only about 50% of its Thai quota. Given market forces it may be the remaining Thai quota units could now be sold as leasehold.

I must confess I was always concerned with the market distortion introduced by the 49/51% rule but it would appear that it can now be bypassed legally. A shame IMO that the rule is just not simply scrapped it is causing a mess/sales hurdle, and now serves no purpose.

This development could add a serious impetus to condominium sales in Thailand.

The news ( if Correct ) that the Thai Speculators prefer to buy into the Foreign Quota to me is not a good sign , it shows not even Thai people beleive in there own product and instead take the bet that they can move it on to a foreigner but not onto a fellow Thai ,

Of course in an open market this would not be the case , but it seems The market is fuelled by foreigners and by Thais betting on Foreigners to purchase property , almost like playing with ourselves ,

If the 49/51 rule was scrapped i believe the market would push prices down , because if we are talking a Foreigner fuelled market it would overnight double the supply , without an overnight increase in demand it would kill the foreigner market ,long term it would all even out but short term it would create havoc.

[pkrv]

There has been an interesting series of developments in the Condominiums In Rajadamri Road - Ok Or Not? thread regarding leasehold. At the moment we have a 49% quota for Farangs and 51% quota for Thais. It would appear that Thai flippers buy into the Farang quota to ensure success in on selling.

Oddly though it seems that if the condominium is leasehold Farangs can buy 100%. There is no cap.

It looks like a new development Sukhothai almost immediately sold its 49% Farang quota but only about 50% of its Thai quota. Given market forces it may be the remaining Thai quota units could now be sold as leasehold.

I must confess I was always concerned with the market distortion introduced by the 49/51% rule but it would appear that it can now be bypassed legally. A shame IMO that the rule is just not simply scrapped it is causing a mess/sales hurdle, and now serves no purpose.

This development could add a serious impetus to condominium sales in Thailand.

The news ( if Correct ) that the Thai Speculators prefer to buy into the Foreign Quota to me is not a good sign , it shows not even Thai people beleive in there own product and instead take the bet that they can move it on to a foreigner but not onto a fellow Thai ,

Of course in an open market this would not be the case , but it seems The market is fuelled by foreigners and by Thais betting on Foreigners to purchase property , almost like playing with ourselves ,

If the 49/51 rule was scrapped i believe the market would push prices down , because if we are talking a Foreigner fuelled market it would overnight double the supply , without an overnight increase in demand it would kill the foreigner market ,long term it would all even out but short term it would create havoc.

I agree but additionally it also means that there is a secondary market that everyone says is poor. Conflicting information all round.

[Old Man River]

Totally not related to this thread and acknowledging it up front, for those that are currently outfitting a new residence (PKRV etc.), there is a big sale on the top floor of Siam Paragon for appliances (TV's, washers, dryers etc). All the major manufacturers selling in Thailand are there and they are motivated sellers (i.e. discounts). Also, depending on which credit card you use, the discounts are higher and free gifts etc. The wife and I hit it today and spent, well, a lot. They will hold the goods for you until you are ready to move in.

[pkrv]

Totally not related to this thread and acknowledging it up front, for those that are currently outfitting a new residence (PKRV etc.), there is a big sale on the top floor of Siam Paragon for appliances (TV's, washers, dryers etc). All the major manufacturers selling in Thailand are there and they are motivated sellers (i.e. discounts). Also, depending on which credit card you use, the discounts are higher and free gifts etc. The wife and I hit it today and spent, well, a lot. They will hold the goods for you until you are ready to move in.

Thanks for the heads up - It was AMEX in Central last time we were over and the next sale at Central I believe discounts for visa.

We are furnished though I think there are going to be a lot of happy faces with the major developments all coming on line at the same time (and credit limits 'pushed to the limit' and no bonkers I pay off my card every month and get money back for spending on it)

Edited July 10, 2008 by pkrv

[quiksilva]

As I hear yet more news and whispers from within the market, I think its worth reviving this thread, if only for me to share some thoughts that I have been developing over the last few weeks.

There are a number of challenges facing condo developers at the moment, the greatest of which is rising construction costs. Stories are circling about profit margins disappearing over night. Some have said that this will only projects targeted at the low-medium sector, but I can tell you that this is simply not true.

Some very high profile projects are now projected to have zero profit margin, and meanwhile costs continue to escalate and transactions at current price points are thin on the ground, especially amongst Thai buyers whose buy-in is crucial for success but they rarely buy above 150,000 Baht per sqm. (Ask yourself how many locals have brought in some of these new ultra high end projects).

I believe that some big names will fall over the coming year, (unless they can control costs and restructure finance agreements), and I believe that some high profile projects may not get off the ground, and I am not just referring to ultra high end here.

I do hear the argument for the ultra high end sector. Branded residences have a proven appeal to a certain sector of the foreign community here and abroad so can see why some are shifting their sights to this sector, but frankly I just don't believe in it given Thailand's restrictions. I think it is hype. Irrational confidence.

One thing for sure is that costs will continue to rise, and looking forward more and more new developments will start to become unfeasible. (I.e. the projects prices to make a margin will unaffordable by locals).

So a pause in the supply pipeline is needed, to give demand a chance to recover to the point where the equilibrium rises to meet the higher costs that developers face today. Also a pause in the supply pipeline will help to bring costs back in line with demand.

Obviously if what I foresee happens it will be sad for all involved but ultimately it would be healthy for the market, because a pause in supply coupled with a scarcity of prime development sites will only serve to support values over the medium term, whilst demand is given a chance to build up.

Just my personal opinion.

[ray08]

I invest in real estate , but from my point of view , and i don,t know about other investors , as the world economic climate is not the best . Investing in Places like Thailand would go at the bottom of the list , as being conservative is now the name of the game ,

But more important is for investing ,we have seen the real estate market drop on Australia , Uk , USA , i think a little more to go, but thats about it , So if someone was to invest in the next 6-12 months , would it not be a good idea to pick up real bargains in the countries listed above , where the prices have taken a real hit , therefore more of an upward trend in the future or buy in Thailand where prices are going up, not down,

IMO there are great opportunities around and more to come in Developed nations for Real Estate , compared to buying in the Thai market where asking prices are only going up ,

On the above logic ,if people were to follow , Buy low and Sell high , why would you put money into here ? very little upside

[steveromagnino]

Some very high profile projects are now projected to have zero profit margin, and meanwhile costs continue to escalate and transactions at current price points are thin on the ground, especially amongst Thai buyers whose buy-in is crucial for success but they rarely buy above 150,000 Baht per sqm. (Ask yourself how many locals have brought in some of these new ultra high end projects).

I agree with the sentiment, but disagree with this statement, as I just had dinner last night and all 6 Thais there own condos in some or all of following

Athenee Residence

Park

Prive

Infinity

that Hansar leasehold thing

and they are waiting for projects in what they consider the prime locations. These are affluent 30 something professionals with access to family money, buying for investment, flicking and as a backup position, to live in. High net worth individuals who are not buying at retail prices, but in the VIP less 5%/10% type presales.

Interesting that they (2 of them) had deposits in Sukhothai but one pulled out and the other has since flicked; no interest in the Met, River or most of the other foreign developer projects.

Prive proves (with sales well above 50% to Thais) that it isn't to do with will Thais pay 150k per sqm (that's fact, they are). It is more a question of can a foreign developer with a marketing plan that hinges on attracting foreigners ALSO manage to sell to Thais - do they even know how to sell to Thais?

On the flip side, Sansiri seem to struggle to match their foreign competitors such as Riamon Land in selling to foreigners!

I'd believe that there are going to be some stalled out projects; I can see one on Langsuan that looks fairly stalled now. There are also going to be some major price rises. But as always, there is always space for good quality perceived value.

[quiksilva]

Fair call Steve, interesting.

Re developers though I personally like Sansiri developments, they are one of the only Thai based developers who consistently win awards in the regional aren.

Yet neither of these firms is making all that much money and therein lies the danger, because in the coming years survival will depend on the strength of their financial foundations.

Compare sales volume to margin amongst the developers and you'll see that groups like L&H, Preuksa, Supalai, and Property Perfect are doing far better, even though their focus in the market sectors is somewhat lower.

[whitethai]

Am I mad?

By selling my house or trying in the current UK climate.

THing is have to pay back the crippling mortgage not worked for two years as been doing up house then visited Thailand for six months (rented house out).

Now back in UK but thinking of buying condo in Pattaya fifteen grand max ( probably ready build not offplan) staying there if sell house at asking price.

Also want to buy one near MabunKrong bangkok ( buy stuff to sell)so can flit from one condo to another.

Someone said View Talay 2 was the best buy right now with good neighbours too?

What do you think of that plan?

Edited July 31, 2008 by whitethai

[Chaimai]

Now back in UK but thinking of buying condo in Pattaya fifteen grand max ( probably ready build not offplan) staying there if sell house at asking price.

Sorry, but you will not sell at asking price. Adjust your plan for a 10-20% shortfall because that is where buyers are pitching. If you wait for the market to catch up with your asking price you will probably sell in 2010/2011.

Where/what can you buy for less than 1m baht ?

Edited July 31, 2008 by Chaimai