Price Reduction - How Low Should I Go For A Quick Sale?

[typist]

I have an opportunity to buy the business one of my main competitors (thank god for the financial crisis). I almost have enough cash, though I could need a little extra, and external funding is hard to come by these days, so looking at my options, I am contemplating to sell a condo in central Bangkok. For this to make sense, the sale would need to be completed in 3 months (the other option is a mortgage on the condo, I am looking into that now).

I am currently leaning towards the mortgage option, as I am afraid 3 months is a short timeframe for a sale in the city of angels, my experience here is that things usually happen slowly. Anyone sold recently? How long did it take?

My rental yield on this one has been 6-7%, so a 10% purchase price reduction should push the rental yield closer to 7-8%. For a condo in central Bangkok which cost me roughly 10.5 million baht 2 years ago (5% below list price then), how much would I need to reduce the price for a quick sale? Thinking about it, I could probably live with a 10% loss provided I get the funds quickly enough, but is anyone buying? 

Edited January 14, 2009 by typist

[typist]

Well I guess I have to try and see, but obviously I don't want to set a price which is too low, on the other hand I don't want to keep reducing the price every week either. The mortgage option seems to be relatively painless, so maybe it's better to wait and sell another time. Still, I'd appreciate if anyone here could share experiences regarding recent condo transactions.

[steelepulse]

Any realisitic comparables in your building or your area that have sold within the last 6 months?  That would be a good starting point.

[think_too_mut]

Any realisitic comparables in your building or your area that have sold within the last 6 months?  That would be a good starting point.

Or last 6 years?

[sorensen]

Do you have any pictures and details of the unit?

What building, floor and size?

Robert

[UncleFrank]

A unit in my building sold for 85,000/meter last year.

Nice building and top location.

More details on your place please.

I recently read there are 22,000 empty units available within 2km of the Skytrain.

Prices are dropping like a rock and some projects are now being abandoned.

Thailand is less attractive these days. Coups, mobs, terrorism, tsunamis, scams, corruption, lousy police force, factories closings, the TIT factor, are all taking it's toll.

If you are under 50 and unmarried, you cannot even stay here long term. No investment VISAs.

hel_l, if you read what the PAD are saying, they would like to get rid of foreigners.

A 10% discount doesn't sound very exciting at this stage to be honest.

Prices in my home town are down at least 30%.

Thailand is about to feel the pain too I'm afraid.

Edited January 15, 2009 by UncleFrank

[typist]

Any realisitic comparables in your building or your area that have sold within the last 6 months?  That would be a good starting point.

Yes, there have been 2nd hand sales of comparable units in the building, however it's not always easy to determine at which price they sold. I agree though, it's a good starting point. from what I've seen, there haven't been any fire sales. most owners probably weren't leveraged, and none have been forced to sell, so I doubt there have been dramatic price reductions.

Someone mentioned a 30% drop in his home town. I'd assume that's mostly due to leverage; easy credit contributing to inflated property prices, which then collapseduring a crisis. Imho the property market in Bangkok is less vulnerable in that respect. Most banks here probably learnt the lesson during the Asia crisis.

Despite the so-called credit crisis, getting a reasonable conservative mortgage on a property in Bangkok (60%) seems to be quite straight forward, easier than a "quick sale". I suppose many buyers are hesitant now, and prefer to buy during an upturn.

Edited January 15, 2009 by typist

[londonthai]

typist, get several estate agents in your area to value your condo and put you on their portfolio and tell them that up to 10% off for the fast sale is possible - they might have already some buyer on their lists.

Yourself put a few ads in the newspapers and a few posters in your building and in your area with already the lowest slashed price plus 3% of the agent's fee (so 13% lowert than the cheapest valuation) with a note, that it's fast sale.

simultanously try to organise a mortgage, if you won't sale within a 3 month, sign a mortage