Trends In Pattaya/jomtien Real Estate Development Market

[billaaa777]

I’m a Real Estate Broker from America living in Pattaya for the past three years. Additionally I ran a Mortgage Brokerage Business. Coming from south Florida I witnessed the implosion of that market and I see many parallel’s here

I swore I was not going to post here anymore more. But after this I had too.

WRONG, again. I am from Miami, and have owned many properties all over Broward County. For those who don’t know this is where he is basing his experience on.

The following is why you WRONG, I could add many more, but I had too many beers.

A) All if not all, at least 95% of the condos bought here are bought with cash. Properties bought in SF were purchased 99.99% on mortgages. LARGE DIFFERENCE!

In Pattaya and Jomtien the condos are bought with cash by buyers that have NO concern about making money on them. They are retired and buying as vacation homes or come over here a few times a year. They have ALLREADY made their money. What happens else where is NO concern to them.

C) At least 50% of the properties bought in SF bought were purchased with VERY questionable mortgages with the sole purpose of making money.

D) There is no place in the world like Pattaya and the demand for properties will not decrease but only increase. Why do you think a city of 500,000 people is building 50,000 units? If they were NOT selling then they would NOT be building. The developers are not stopping building, but only INCREASING there rate of building.

[prefabs]

I'm a Real Estate Broker from America living in Pattaya for the past three years. Additionally I ran a Mortgage Brokerage Business. Coming from south Florida I witnessed the implosion of that market and I see many parallel's here

I swore I was not going to post here anymore more. But after this I had too.

WRONG, again. I am from Miami, and have owned many properties all over Broward County. For those who don't know this is where he is basing his experience on.

The following is why you WRONG, I could add many more, but I had too many beers.

A) All if not all, at least 95% of the condos bought here are bought with cash. Properties bought in SF were purchased 99.99% on mortgages. LARGE DIFFERENCE!

In Pattaya and Jomtien the condos are bought with cash by buyers that have NO concern about making money on them. They are retired and buying as vacation homes or come over here a few times a year. They have ALLREADY made their money. What happens else where is NO concern to them.

C) At least 50% of the properties bought in SF bought were purchased with VERY questionable mortgages with the sole purpose of making money.

D) There is no place in the world like Pattaya and the demand for properties will not decrease but only increase. Why do you think a city of 500,000 people is building 50,000 units? If they were NOT selling then they would NOT be building. The developers are not stopping building, but only INCREASING there rate of building.

In one respect, you are 100% correct. You have had too many beers.

Ask the people trying to sell houses on the East Side of Sukhumvit if they are selling easily enough

Where is the evidence that there is an increase in demand for expat type building? Ocean Tower 1 maybe? The Sails? The Spinnaker?

Maybe in the low cost areas such as one room dwellings which cater for the local workforce. But that is not what this thread is all about.

[kedawi]

Well I get the impression that a lot of building takes place in Pattaya that is way outside the influence of “normal” market pressures and rules....i.e. it is simply connected to corruption....money laundering, and contracts that line local dignitaries’ pockets and contactors......it shows all the signs that are so familiar in Italy where the alternative economy is reckoned to be bigger than the regular economy; buildings shoot up in one place for no apparent reason and remain idle for years in another....

[fidelio]

I'm a Real Estate Broker from America living in Pattaya for the past three years. Additionally I ran a Mortgage Brokerage Business. Coming from south Florida I witnessed the implosion of that market and I see many parallel's here

I swore I was not going to post here anymore more. But after this I had too.

WRONG, again. I am from Miami, and have owned many properties all over Broward County. For those who don't know this is where he is basing his experience on.

The following is why you WRONG, I could add many more, but I had too many beers.

A) All if not all, at least 95% of the condos bought here are bought with cash. Properties bought in SF were purchased 99.99% on mortgages. LARGE DIFFERENCE!

In Pattaya and Jomtien the condos are bought with cash by buyers that have NO concern about making money on them. They are retired and buying as vacation homes or come over here a few times a year. They have ALLREADY made their money. What happens else where is NO concern to them.

C) At least 50% of the properties bought in SF bought were purchased with VERY questionable mortgages with the sole purpose of making money.

D) There is no place in the world like Pattaya and the demand for properties will not decrease but only increase. Why do you think a city of 500,000 people is building 50,000 units? If they were NOT selling then they would NOT be building. The developers are not stopping building, but only INCREASING there rate of building.

Ladies and gentlemen, please welcome back the king of real estate bullshiter : billaaa77

[plasticpig]

Think his still stuck with a few crap units in Majestic condo in Jomtien.

[APMann]

I'm a Real Estate Broker from America living in Pattaya for the past three years. Additionally I ran a Mortgage Brokerage Business. Coming from south Florida I witnessed the implosion of that market and I see many parallel's here

I swore I was not going to post here anymore more. But after this I had too.

WRONG, again. I am from Miami, and have owned many properties all over Broward County. For those who don't know this is where he is basing his experience on.

The following is why you WRONG, I could add many more, but I had too many beers.

A) All if not all, at least 95% of the condos bought here are bought with cash. Properties bought in SF were purchased 99.99% on mortgages. LARGE DIFFERENCE!

In Pattaya and Jomtien the condos are bought with cash by buyers that have NO concern about making money on them. They are retired and buying as vacation homes or come over here a few times a year. They have ALLREADY made their money. What happens else where is NO concern to them.

C) At least 50% of the properties bought in SF bought were purchased with VERY questionable mortgages with the sole purpose of making money.

D) There is no place in the world like Pattaya and the demand for properties will not decrease but only increase. Why do you think a city of 500,000 people is building 50,000 units? If they were NOT selling then they would NOT be building. The developers are not stopping building, but only INCREASING there rate of building.

Your point D is incorrect. Properties are NOT selling, yet fools keep building. It's called a condition precedent for a market crash.

Your analysis ignores the reduced numbers of buyers, let alone tourists, coming to Thailand, and Pattaya in particular, massively increased construction costs since many developments were expensively trumpeted, high prices per sq metre, the global financial crisis and the woeful state of Thailand generally, which has further squeezed Thai and foreign banks' willingness to bankroll developments when fresh money is required, all of which will have a material adverse impact on the market, as we shall soon no doubt discover if and when a few of the big boys go under.

[RobertPattaya]

Billaa777, I don’t come from Miami but the south west area of Florida. If you recall this sentence in my post, “This is exactly what happened in Florida three years before the market crashed. The difference was all the financing options in America distorted the values even more than they are here but the fundamental valuation methods still apply”.

I am aware that most of the sales here are cash transactions. If you notice I based my example of economic determination of value on a cash sale. It doesn’t matter if you’re paying cash or financing the same rule applies. What I’m focusing on is determining the value of a property based on its production value.

However I agree with you that none of that is important in satisfying the needs of a Buyer who have no concern about making money on the property they purchase here. I realize there are a larger percentage of property consumers here that fit into those criteria here. However for a buyer interested in investing to make money or maintain cash flow, economic valuation techniques are a valuable tool to analyze the potential of a particular piece of properties ability to generate a consistent income stream. As I said I’m the type of buyer that is interested in yield when I buy real estate. The rental incomes here have no correlation to the sell prices based on economic evaluation, they are speculative values. Some investors like to speculate that properties will skyrocket in value and sometimes they will. I like to buy properties that I know will make me money, I’m not too much of a speculator, I’m looking to set up reliable income streams with my money.

R…

[sotsira]

Couldn't agree more, estate agents in Pattaya and Jomtien have no idea in what the job involves, i made enquires to sell my property with over 10 different agents and they all just asked me how much i want to sell for with no advice or valuation of their own, i even asked them what i should sell for and none gave a straight answer and most didn't even come to inspect the property, they just took photos from my flash drive that i took for them!

I will answer one of these them I am done here.

Don't you know why none of them wanted to do business with you? I do. If you had a property they think they could sell, you think they would have just walked away? You are just one more person walking into their office with no idea what their property is really worth.

Marking your price way up, when there are another 20 properties just the same as yours priced way less. Why, would they spend time messing with you? They have MUCH better deals to offer their customers. Don't you realize agents have to spend time and money marketing your property? And if they have so MANY better deals than yours, then why would they?

Just one more at this site that does not have a clue that is going to blame an agent because they can't sell their property. Everything can be sold, but at what price. Just reading your post is SO sad and the fact that I am the only one that responded, might even be worse.

Your post just SCREAMS OUT, "I do not have a clue what I am talking about."

Billaaa777,

You certainly don't have a clue what your talking about, your not a real estate agent by any chance, are you?

You make assumptions, then claim to know the answers, without knowing the facts. As other posters have already said in not so many words that you blow a lot of hot air!

As i wrote in my above post that estate agents here in Pattaya really don't know how to do their jobs, i am a prime example of their incompetance, after listing my property with over 10 different agents back in May this year, only 3 or 4 could be bothered to actually come to inspect the property and take there own photos, but none of them would suggest a selling price, so they all wanted me to value my own property. I thought that was part of there job as estate agents should also be able to do valuations, but obviously not in Pattaya.

So as the months rolled on and i had very little feedback from any of them i decided to do my own marketing and had a sign made up and put some private adds around which had a much more positive effect, and low and behold i now have not only 1 but 2 interested buyers which in effect has raised the asking price as 1 buyer has outbid the other and today have secured the sale, for more than what i would have got from any agent taking in to account their 5% commission.

All this is due to the incompetance of the agents marketing skills, or lack of them, and the inability to know what properties are really worth, hence leaving the sellers to try and value their own properties which usually means overinflating the values hence putting off any prospective buyers. In my case, i feel i managed to value realistically, as once i marketed the property myself it sold quickly saving me an agents 5% comm, which i feel is also way too high for what they do or don't do for that matter!

[hoolbear]

I recall some mega condo being planned a couple of years ago, to be built in Jomtien

The 91-storey Ocean 1 condominium, 327 metres in height, is being spearheaded by Siam Best Enterprises Co. It will occupy a site of 12 rai in Jomtien, south of Pattaya, with 611 units, priced anywhere between five million and 150 million baht each, or 100,000 baht per square metre.

Bruno ######, Siam Best's managing director, said it would be a new city icon, adding that its height had already attracted bookings of 12% from buyers from Europe, Australia and the United States.

The company invested 280 million baht in acquiring the land for Ocean I with the construction financed by TMB Bank. It will be launched officially in October.

I seldom visit the area of Jomtien where I believe this was to be built. Haven't heard anything about it recently. Is it still on? I haven't noticed any extraordinary structure casting a shadow across the landscape.

Even when it was proposed, in the midst of what seemed to be condos popping up everywhere, it seemed ovely ambitious. In the current market I would think it would be a financial disaster.

Ocean 1 is NEVER going to happen. The company Siam Best Enterprises are being sued by tons of people unlucky enough to have put down deposits. The Thai Bank are closing in on them and they can't even meet their existing commitments. No bank would lend them the money to finance this. The Ocean 1 site is cleverly rented out to a cement works that gives the illusion that some building project is under way to the casual holiday maker. The fact is, they've been mixing cement there for other developments around Pattaya for nearly 2 years now.

Meanwhile SBE keep ripping off innocent investors while pretendingn the whole project is going ahead. Everytime I go there I read in some magazine that Ocean 1 is commencing in a month or 2 but, suprise suprise, nothing ever happens.

I give them another 6 months before the game is well and truly up!

Edited July 11, 2009 by hoolbear

[Ohio]

So , We should not be buying our condo yet ????????

That is the advice we had in January & it seems that this is even more truer now , that the asking prices are inflated to heck??