Capital Faces Oversupply Of Condo Units

[Pakboong]

I agree with you completely! Falling equities ( and Put options ) at just the right times over the last six to eight weeks have made me very good money.

now that money is in cash unlike a sitting duck with a Bangkok second hand condominium

around my neck The problem is what storm clouds are gathering - looks very stormy on the horizon........................

You must have a big pair of cojones as these days the markets could just as easily climb by 20% as drop depending on which way the wind blows.

I don't see any big drop happening with the Bangkok real estate market prices- only fewer transactions. Back 10 years ago (which to me had a far bigger impact on Thailand than anything happening today) there were a lot of people ready with cash to scoop up properties sold off at firesale prices... and not much happened aside from some auctions of Ssongyangs and whatnot.

If anything I think like that time it'll be flat for several years with developments here and there halted. Anyhow, the top tier stuff still keeps plowing on regardless of the latest market conditions.

We are approaching uncharted waters.

[midas]

I don't see any big drop happening with the Bangkok real estate market prices- only fewer transactions. Back 10 years ago (which to me had a far bigger impact on Thailand than anything happening today) there were a lot of people ready with cash to scoop up properties sold off at firesale prices... and not much happened aside from some auctions of Ssongyangs and whatnot.

If anything I think like that time it'll be flat for several years with developments here and there halted. Anyhow, the top tier stuff still keeps plowing on regardless of the latest market conditions.

Crash this is GLOBAL not Asian and people around the world have gone into their shells regaring spending for a very long time

( at least until they clear their debts and that cant happen until they shake off negative equity in Us and Uk and the unemployment

is skyrocketing etc etc etc .) Try to join the dots

I cannot possibly understand also how you could read the graph and come to the conclusion

that " it'll be flat for several years " ? In those days ( 10 years ago ) there were far less condos

avialable and many more expat renters in the marke.t

I think that what lies ahead will make the property " hicup " of 1997 look like a vicars tea party

[Nouf]

richm7 wrote -

What is all this crap about short selling? You write as if it is a no brainer that anyone can make money on rather than a very risky gamble which it in truth really is. Ask the smart alecks who just got burned by the Porsche buy out of VW.

If it is so easy to make money short selling perhaps you would be kind enough to give us all a few tips. Next week's winning lottery numbers would be nice too.

that particular example was insider knowledge with porsche and the government, the laws as i understood it were different to the US and alot was partially to do with Naked short selling, did you notice the next day alot of it came right back of, that sort of move on VW moved the Dax to silly levels

what you are presently witnessing in the equities markets are unreal, especially in the ES (spx futures) 30-40 daily range with a 200 point range, its an extremely tough market to trade, and trading futures has taken out many pro`s in the game to put it in to context in a days range you never saw these sort of moves in a month span on the bull run from 2002

100 ES points on a day is on verge on insanity, hence many pros have fallen on the roadside (when i mean pro`s i mean the locals in the s&p pit in chicago at the CME (chicago mercantile exchange)

but with alot of knowledge its very possible to still make money in this environment if you trade futures or options

(i trade ES futures or a daily basis, and its not the sort of market for novice traders, but i have learnt my trade from years or trading and screen time,) coulpled that with Techincal analysis (TA)

A tip for any would be traders, dont listen to the media they are there to pull you in and get you on the wrong side of the trade

like shorting holes after a decline and getting long after rallies.

PS - i know its slighlty off topic buts its still posssible to make money trading equities either direction

Edited November 17, 2008 by Nouf

[bingobongo]

lets see

oversupply - check

less farangs arriving - check

thais cant afford - check

and credit faucet drying up - check

OUTLOOK

Market expected to shrink by 10%

The banks are now rejecting about 40 per cent of mortฌgage applications, when the previous rejection rate was about 25 per cent, he said.

http://www.nationmultimedia.com/2008/11/19/business/business_30088739.php

[ace]

OUTLOOK

Market expected to shrink by 10%

Or.....Thai property market outperforms stock market by 30% ?

[midas]

OUTLOOK

Market expected to shrink by 10%

Or.....Thai property market outperforms stock market by 30% ?

That doesnt mean anything ?

There is no timelag in the stockmarket like there is in CONDO developments...........

Just wait ...............its coming ...............

[bingobongo]

sure many bagholders will lose their deposits, but at least somchai the builder will still be able to get that new S class Benz

RESIDENTIAL MARKET

Most firms suspend new projects

Falling buying power, lack of confidence bite into sales

http://www.nationmultimedia.com/2008/11/20...ss_30088861.php

Edited November 20, 2008 by bingobongo

[glyph]

Firms suspend new projects, to prevent an oversupply of condos. What's the big dealio?

[midas]

Firms suspend new projects, to prevent an oversupply of condos. What's the big dealio?

the oversupply has ALREADY HAPPENED

just read this

http://thaicrisis.wordpress.com/category/e...estate-economy/

[thaihome]

Firms suspend new projects, to prevent an oversupply of condos. What's the big dealio?

the oversupply has ALREADY HAPPENED

just read this

http://thaicrisis.wordpress.com/category/e...estate-economy/

No one is doubting the real estate market in Thailand is on downward trend. Any developer that is slightly overextended is going to be in for a hard time over the next year or so.

Congratulations, you have called this one right.

TH

[glyph]

"the oversupply has ALREADY HAPPENED"

Ah yes, the very informative "thaicirisis" website. The very place I go for unbiased and truthful infomation. Collapsing real estate prices predicted by you and bingobongo would provide clear evidence of the massive oversupply....and that has not happened.

[midas]

"the oversupply has ALREADY HAPPENED"

Ah yes, the very informative "thaicirisis" website. The very place I go for unbiased and truthful infomation. Collapsing real estate prices predicted by you and bingobongo would provide clear evidence of the massive oversupply....and that has not happened.

what and your statements are more unbiased and truthful ?

[think_too_mut]

now now glyph, do not hate the player, hate the game

anyway, i understand your financial astuteness is lacking so i am going to teach something called a "capital trap", so please write this down and paste to the wall of your crumbling domicile (or soon to be crumbling)....are you ready?

CAPITAL TRAP: When an asset starts depreciating rapidly (due to oversupply, poor construction, credit crunch, bombings in the streets, etc), the smart investment decision is to sell it quickly and preserve whatever capital you still have--unless it's illiquid, in which case your capital is trapped.

here is how to apply in a sentence glyph: As in the "current condo/real estate market (insert city here) is a capital trap"

Bingobongo - your sparing partner has been banned under his former "backflip" handle. A champion of "ignore" lists.

And your personal stalker, you should have reported him.

I don't know why the Mods are letting him trade again under a new handle. Is it that someone is banned just for 1 handle and can come again under a new one?

For me, keep on pushing the news from the dark side. (I bought and I knew and expect the place to be unsellable, not that I would ever attempt to sell it, let alone any proifit).

[bingobongo]

now now glyph, do not hate the player, hate the game

anyway, i understand your financial astuteness is lacking so i am going to teach something called a "capital trap", so please write this down and paste to the wall of your crumbling domicile (or soon to be crumbling)....are you ready?

CAPITAL TRAP: When an asset starts depreciating rapidly (due to oversupply, poor construction, credit crunch, bombings in the streets, etc), the smart investment decision is to sell it quickly and preserve whatever capital you still have--unless it's illiquid, in which case your capital is trapped.

here is how to apply in a sentence glyph: As in the "current condo/real estate market (insert city here) is a capital trap"

Bingobongo - your sparing partner has been banned under his former "backflip" handle. A champion of "ignore" lists.

And your personal stalker, you should have reported him.

I don't know why the Mods are letting him trade again under a new handle. Is it that someone is banned just for 1 handle and can come again under a new one?

For me, keep on pushing the news from the dark side. (I bought and I knew and expect the place to be unsellable, not that I would ever attempt to sell it, let alone any proifit).

thanks for the notice TTM, i thought his frustration/denial sounded familiar, i can only hope that my Christmas wish of backflip (or whatever he calls himself these days) disappearing comes true

[bingobongo]

to quote marlon brando in apocolypse now glyph......the horror, the horror

when they to "its knees" are they talking about the bargirls or the condo market?

Condo market set for slowdown

"The aftermath of this crisis will take longer than 24 months," said Samma Kitsin, director-general of Real Estate Information Centre (REIC).

Developers may face the double challenge of unsold units remaining and untransferrable units returning. At the same time, they may have to face new competition from completed resale units being offered by speculators.

http://www.bangkokpost.com/241108_Business/24Nov2008_biz78.php

[bingobongo]

this guy must have had too much yabba

what do you do when you already have oversupply, a credit crunch, and a nonfunctioning gvt?........why build more of course, genius, pure genius

Asian Property goes lowrise

Developer stresses caution as it opts for smaller, faster housing projects next year

http://www.nationmultimedia.com/2008/11/25...ss_30089280.php

[bingobongo]

well what do you think about this condo sales pitch?

1) the airport is now closed

2) the baht is about to go over a cliff (so Dan the dreg may get 10% inflation appreciation but don't forget the 10%+ baht depreciation thats coming)

3) either a civil war or coup is coming and

4) about 1 million thais are going to lose their jobs within the next year

do you think any of these will be mentioned in the shiny glossy real estate brochures? genius, pure genius

Edited November 26, 2008 by bingobongo

[cclub75]

well what do you think about this condo sales pitch?

You forgot one very important item (for the sales pitch):

5) The Market Is Healthy (copyrighted)

We are going to laugh, endlessly, at all the sweet daydreamers who were unable to understand the word crisis : political crisis, financial crisis, global crisis etc.

I know it's not fair play to laugh... but I can't stop.

And the best is : they will probably continue. Over and over. It's basic human behaviour. They can't acknowledge their owns mistakes.

Edited November 26, 2008 by cclub75

[bingobongo]

so many dreams destroyed, so much money to be lost, and yet they will keep building.........oh well

Real estate loses billions

The Suvarnabhumi Airport shutdown has scared away potential foreign investors and buyers in the property market, causing billions of baht worth of damage, according to Patima Jeerapaet, managing director of the property consultant Colliers International Thailand.

"It is worse than the Phuket International Airport blockade (in September). The overall situation is very bad. We just got cancellations from potential customers from Eastern Europe who had planned to fly to Bangkok," he said yesterday.

"If the situation does not improve, pending property deals worth around one billion baht in the final stages will definitely vanish. Investors who are waiting and seeing or freezing their investment will absolutely cancel."

He added that foreigners generally came to buy property during the high season but the airport closure would slow transactions.

Meanwhile, the country's hotels and serviced apartments face a major occupancy decline that could get worse.

Some hotels in Bangkok have an occupancy rate of only 20-30% despite the fact that this is the high season.

http://www.bangkokpost.com/271108_Business...v2008_biz26.php

Edited November 26, 2008 by bingobongo

[LoveDaBlues]

well what do you think about this condo sales pitch?

You forgot one very important item (for the sales pitch):

5) The Market Is Healthy (copyrighted)

We are going to laugh, endlessly, at all the sweet daydreamers who were unable to understand the word crisis : political crisis, financial crisis, global crisis etc.

I know it's not fair play to laugh... but I can't stop.

And the best is : they will probably continue. Over and over. It's basic human behaviour. They can't acknowledge their owns mistakes.

George Bush is buying in Thailand?

[bingobongo]

maybe they should offer your choice of free hand clapper and/or red or yellow shirt? what do you think?

is this battle the same as the other "final battle"?

HOUSING PRICE WAR

Buyers' market as developers battle

The developers, who are keen to boost their sales before the end of the year, have effectively reduced their resฌidential prices by 5 to 10 per cent. Some have launched aggressive marketing campaigns in a bid to clear inventories in existing residential projects.

He said the company could not simply cut the price of its oldermodel detached houses because customers who had bought the same houses at the old price would feel bad about it.

http://www.nationmultimedia.com/2008/11/27...ss_30089488.php

[Scott123]

The longer you can collect a rent on your asset the better!!

Lets say - you have a 5 M Bt asset rented out at 35,000 Bt / month, over a 5 year (long period) term you will have written down your asset to 2.9 M Bt, so even if you sell at the same price it cost 5 M Bt, (highly unlikely on a property), you will still have made a profit of 2.1M Bt.

Thats 8.4% ROI per annum, better than you will get with any bank meantime!

your statement is under these BIG assumptions:

1. you have tenants to rent your asset without interrution thoroughout the 5 year period.

2. you did not account for the agent commission or maintenance/repair cost for your rental property.

3. when you want to sale the property in 5 years, you can find a buyer.

4. the buyer will pay 5 M baht for that property that is already 5 years old. Keep in mind that rental properties get worn out fast. Also, if the real estate market takes a dive, who knows what the comparable market values of a 5 year old property is.

[pkrv]

I guess a simple question - How many of these new condominiums were also targeted at Farangs? An open question.

[bingobongo]

well at least the bagholders will have a great view of the civil unrest from their balconies

so many dreams destroyed, so many deposits never to be returned, so many delusions remedied.............

Buathong to freeze new projects

''The real estate market has slowed down over the past three years and it will continue in the future. The situation is getting worse now so we need to freeze new project developments to avoid risks,'' he said

One of the projects is a 77-unit condominium, launched two years ago but with only 20 units sold.

http://www.bangkokpost.com/281108_Business...v2008_biz37.php

[LennyW]

The longer you can collect a rent on your asset the better!!

Lets say - you have a 5 M Bt asset rented out at 35,000 Bt / month, over a 5 year (long period) term you will have written down your asset to 2.9 M Bt, so even if you sell at the same price it cost 5 M Bt, (highly unlikely on a property), you will still have made a profit of 2.1M Bt.

Thats 8.4% ROI per annum, better than you will get with any bank meantime!

your statement is under these BIG assumptions:

1. you have tenants to rent your asset without interrution thoroughout the 5 year period.

2. you did not account for the agent commission or maintenance/repair cost for your rental property.

3. when you want to sale the property in 5 years, you can find a buyer.

4. the buyer will pay 5 M baht for that property that is already 5 years old. Keep in mind that rental properties get worn out fast. Also, if the real estate market takes a dive, who knows what the comparable market values of a 5 year old property is.

Correct, but it has worked for me for a number of years now, and continues to do so thankyou very much!!

Just look at how much free advertising you get on this site....every time somebody posts saying they want to BUY a house or condo, hundreds of posters come out saying RENT RENT RENT!!! Magic!!!!

Edited November 28, 2008 by LennyW

[midas]

Correct, but it has worked for me for a number of years now, and continues to do so thankyou very much!!

Just look at how much free advertising you get on this site....every time somebody posts saying they want to BUY a house or condo, hundreds of posters come out saying RENT RENT RENT!!! Magic!!!!

Lenny I don't envy you one little bit with all those property assets around your neck !

With the fallout from what is happening right now, where are your tenants going to come from in months to come?

[LennyW]

Correct, but it has worked for me for a number of years now, and continues to do so thankyou very much!!

Just look at how much free advertising you get on this site....every time somebody posts saying they want to BUY a house or condo, hundreds of posters come out saying RENT RENT RENT!!! Magic!!!!

Lenny I don't envy you one little bit with all those property assets around your neck !

With the fallout from what is happening right now, where are your tenants going to come from in months to come?

Been through Coups, Ridiculous exchange rates, Bird flu, Sars, Tsunami, before no big difference for me, no worries.

It does annoy me though the impact this will have on some business especially at this time of year, its a dammned shame for some of those setting up new ventures in the hope of scoring in the high season, i guess in those circumstance the effects will be felt for some considerable time to come.

Edited November 28, 2008 by LennyW

[midas]

Been through Coups, Ridiculous exchange rates, Bird flu, Sars, Tsunami, before no big difference for me, no worries.

It does annoy me though the impact this will have on some business especially at this time of year, its a dammned shame for some of those setting up new ventures in the hope of scoring in the high season, i guess in those circumstance the effects will be felt for some considerable time to come.

Lenny I think you need to take off those rose tinted glasses that you're obviously wearing

if you cannot tell the difference between the gravity of what is happening now and how it will permanently damage

the image and the economy compared to all the other things you listed then obviously to use the words

of John McCain " you just don't get it ". Haven't you seen another thread in the general section where somebody asks

what could happen to foreigners in the event of Civil War?

It's unnerving

[LennyW]

Been through Coups, Ridiculous exchange rates, Bird flu, Sars, Tsunami, before no big difference for me, no worries.

It does annoy me though the impact this will have on some business especially at this time of year, its a dammned shame for some of those setting up new ventures in the hope of scoring in the high season, i guess in those circumstance the effects will be felt for some considerable time to come.

Lenny I think you need to take off those rose tinted glasses that you're obviously wearing

if you cannot tell the difference between the gravity of what is happening now and how it will permanently damage

the image and the economy compared to all the other things you listed then obviously to use the words

of John McCain " you just don't get it ". Haven't you seen another thread in the general section where somebody asks

what could happen to foreigners in the event of Civil War?

It's unnerving

Seen that, nothing more than speculation and scaremongering, no basis whatsoever, only fuelled by the ease of access to the internet.

I was just saying that it makes no difference to me, but thanks for your concern Midas.

[midas]

Seen that, nothing more than speculation and scaremongering, no basis whatsoever, only fuelled by the ease of access to the internet.

I was just saying that it makes no difference to me, but thanks for your concern Midas.

Lenny successful ownership of real estate assets

in any country requires a strong legal system. At this point in time

there is no rule of law in Thailand and so I can't possibly see

how real estate can be considered to be a good investment?

And this is quite apart from the other issues regarding the

global economic crisis