Twelve Condominium Projects Suspended

[mommysboy]

Reading the article which bingobongo referenced:

"The situation in Thailand is very different to many other Asian countries, and cannot be compared to the difficulties we faced in 1997. The debt levels on existing, completed buildings are much lower this time. In the office and retail sectors, there is limited future supply under construction."

In summary, things are much worse in Singapore, South Korea, and Hong Kong.

Yep, keep the analysis up and come midnight we'll have a boom on our hands, in your mind that is!

[hhgz]

"Yep, keep the analysis up and come midnight we'll have a boom on our hands, in your mind that is!"

Well, mommysboy, I just summarized the portion of the article that wasn't posted. I didn't write it.

"Real Estate companies can no longer cover this up. 50% drop in prices on the way."

Somewhere, perhaps, but not in Bangkok.

Edited February 6, 2009 by hhgz

[bingobongo]

when i think of all the bagholders......

monkeys i tell you, monkeys

Edited February 7, 2009 by bingobongo

[lost_in_space]

In my little townhouse moobaan, it seems like sale prices are based on whether or not the property is a burden on the owner. Might not the same be true for developers? I suspect some condo prices will drop, and others will remain static, as there's nowhere else to put their money for a reasonable return in the current economy.

[bingobongo]

oh the humanity, so many dreams and deposits about to disappear, well at least the birds will have new homes to move into

i wonder how the RE spin machine will turn this into a positive developement (that was a pun)........let me guess, the market is sill booming, healthy, etc(insert rainbow here)

fools deserve to be separated form their dough

BANGKOK SETBACK

Twelve condominium projects suspended

Normally, the market can absorb unsold residential stock within one-and-a-half years, Samma said, but now that the economy is reeling from the global recession, it will take twice as long.

http://www.nationmultimedia.com/2009/02/05...ss_30095036.php

"fools deserve to be separated form their dough". Do they, why is that? They have probably worked long and hard for that money. What sort of <deleted> are you gloating over others misfortune? No doubt someone with nothing yourself, except a bar bill.

lol, i work for my money too, that is why i am not dumb enough to invest blindly and get emotional about investments, half these fools got greedy and got their <deleted> handed to them

anybody can make money, but it takes smarts not to be separted from it and manage it correctly

oh and to your last point, i do not drink

Edited February 7, 2009 by bingobongo

[bingobongo]

There's a German word, schadenfreud, meaning finding pleasure at the misfortune of others, that expresses perfectly the attitutde of the OP here. Hard to see anything of value or constructive that they contribute here. All of us are quite capable to make our own decision as to what to do with our money, and nothing they say can influence us.

So to answer Gravelrash's question then, he's a schadenfreud <deleted>.

i am a <deleted> because others make bad choices?

come on now, dont hate because you are blind to what has and is happening, by the way how is the 3rd world these days?

Edited February 7, 2009 by bingobongo

[rixalex]

i am a <deleted> because others make bad choices?

No, you're a <deleted> for gloating. Bet you've never made a bad choice in your life - and i bet your farts smell like freshly cut roses. What a perfect, flawless specimen you are to behold.

[homehunter]

Environmental Assesment is done after the building is completed?? Isnt that ass backwards?? I mean the project is already up and completed so isnt it too late then to say its bad for the area???

Also curious as to which projects as well. I have seen that property plus one on ratchada near ladprao, they had to dismantle an upper floor 'cos it was too high. Now its still sitting empty eventhought the building is finished

As to 50% drop in prices....I definitely will be doing some shopping.

Environmental Impact Assessment (E.I.A.) is required prior to construction commences and most developers will conform to this as any changes implemented by E.I.A. could cost the developer dearly. However, this is Thailand (TIT) and many connections mean loopholes are made if not found!

As to 50% drop in prices..... I do not know any market in the world where property prices are as competitively priced as here in Thailand (like-for-like) so I can not foresee 50% price drops with the current cost of construction increasing not declining. I do however see incentives to buy other than price drops.

This market dictates that buyers choose their developer with care and ensure they have some form of Escrow or equivalent should anything unforeseen happen.

[thaiwanderer]

As to 50% drop in prices..... I do not know any market in the world where property prices are as competitively priced as here in Thailand (like-for-like) so I can not foresee 50% price drops with the current cost of construction increasing not declining. I do however see incentives to buy other than price drops.

oh, please why don't you also include a link to your website here.

[Zombienation]

Childish comments aside, condo prices are vastly inflated in a country where the average wage is around 20,000 Baht per month. As has been seen in other countries, an adjustment is due and necessary. As the export businesses start to lay off workers, fewer Thais will have money to spend on rents or new purchases. The Thai market should shrink.

Add to this that the farang market here is shrinking, due to a lot less having money to splash about (both because of the dire economic situation and appalling exchange rates) then the only logical conclusion is that prices have to fall.

I know of several Thai families who bought up lots of condos to rent out (mostly to farang as they can charge more)...they bought on credit more often than not. Their customers will be fewer this year and maybe next year. This is going to hurt a lot of folks and maybe some of those Thais will be looking to offload some of their purchases. The market could be flooded....or it might not but it seems a logical conclusion.

Regardless, prices aren't falling yet.

[midas]

Childish comments aside, condo prices are vastly inflated in a country where the average wage is around 20,000 Baht per month. As has been seen in other countries, an adjustment is due and necessary. As the export businesses start to lay off workers, fewer Thais will have money to spend on rents or new purchases. The Thai market should shrink.

Add to this that the farang market here is shrinking, due to a lot less having money to splash about (both because of the dire economic situation and appalling exchange rates) then the only logical conclusion is that prices have to fall.

I know of several Thai families who bought up lots of condos to rent out (mostly to farang as they can charge more)...they bought on credit more often than not. Their customers will be fewer this year and maybe next year. This is going to hurt a lot of folks and maybe some of those Thais will be looking to offload some of their purchases. The market could be flooded....or it might not but it seems a logical conclusion.

Regardless, prices aren't falling yet.

It sure is murky isnt it ? I am surpised no one seems to have researched this

in more depth ?

[ray08]

Childish comments aside, condo prices are vastly inflated in a country where the average wage is around 20,000 Baht per month. As has been seen in other countries, an adjustment is due and necessary. As the export businesses start to lay off workers, fewer Thais will have money to spend on rents or new purchases. The Thai market should shrink.

Add to this that the farang market here is shrinking, due to a lot less having money to splash about (both because of the dire economic situation and appalling exchange rates) then the only logical conclusion is that prices have to fall.

I know of several Thai families who bought up lots of condos to rent out (mostly to farang as they can charge more)...they bought on credit more often than not. Their customers will be fewer this year and maybe next year. This is going to hurt a lot of folks and maybe some of those Thais will be looking to offload some of their purchases. The market could be flooded....or it might not but it seems a logical conclusion.

Regardless, prices aren't falling yet.

I would imagine the avg thai wage is more like thb 10000 per month if you cosider that is what a good factory worker gets, back to real estate ,i like the comment about Thai,s borrowing to buy ,i also know some who borrow ,and also a few where there business has been hit ( exporters ) who are in a bit of trouble ,the Myth about all Thai,s who own real estate been cashed up is being broken

[PattayaParent]

<snip>

I know of several Thai families who bought up lots of condos to rent out (mostly to farang as they can charge more)...they bought on credit more often than not. Their customers will be fewer this year and maybe next year. This is going to hurt a lot of folks and maybe some of those Thais will be looking to offload some of their purchases. The market could be flooded....or it might not but it seems a logical conclusion.

Regardless, prices aren't falling yet.

But if the Farang quota in the building is full all those Thai owned units coming onto the market aren't going to be of any benefit to the Farang regardless of price.

Edited February 8, 2009 by PattayaParent

[shochu]

actually, most of the young thai professionals buying into the condo market have salaries starting at 20,000 and many have many times this. many have saved a lot of money since they don't have much expenses since everthing was/is pretty much paid for by the family except their indulgences.

i am now starting to see condos (practically similar) in the same building with huge variances in prices - 6mil+ and 4 mil+ in the thonglor area.

Edited February 8, 2009 by shochu

[bingobongo]

Many of those with kool-aid fantasies of the riches they were going to obtain from their houses are waking up to the reality of the market.

Reality must be very unpleasant for the typical homedebtor. I am sure more prefer the denial of beliefs such as: “prices will rebound when the economy picks up” or “this correction is only temporary” or “Thailand real estate has proven to be a good investment in the long term” or “we are closer to the bottom than to the top.”

All of these beliefs cause people to hold on to real estate that is draining all their cash each month and giving them nothing in return.

[midas]

actually, most of the young thai professionals buying into the condo market have salaries starting at 20,000 and many have many times this. many have saved a lot of money since they don't have much expenses since everthing was/is pretty much paid for by the family except their indulgences.

i am now starting to see condos (practically similar) in the same building with huge variances in prices - 6mil+ and 4 mil+ in the thonglor area.

shochu

I have been thinking about this statement

Does your research so far suggest why this is the case?

I remember seeing a brand new building in which some condominiums were being offered for

rent by owner investors. There were also some inexplicable asking rents in that building. Even though all of the

owners had fitted out their property very generously with different styles of new furniture,

what was being offered was essentially the same in each one except for a small difference

in some cases with floor levels.

But there was in some cases a substantial difference in the rent being asked

without any logical reason. I attributed at the time to perhaps a variation of

negotiating skills by the owners in that some had probably managed to buy the property

at the true market price whereas others may have paid too much. After

that they worked out how much rent they needed - maybe even to pay the finance?

I mean surely they could have seen themselves the huge rent difference which looked silly

Because of what you said I thought it could have been a similar situation?

[bingobongo]

The Nouveau Riche are supposed to have money, aren’t they? In Thailand, debt is a useful substitute because looking rich is all the matters. Perhaps it is the land of the Nouveau Dette…...

[jcon]

The Nouveau Riche are supposed to have money, aren’t they? In Thailand, debt is a useful substitute because looking rich is all the matters. Perhaps it is the land of the Nouveau Dette…...

bingo you can rant about the world economy and whatever... but don't doubt the rich in Thailand... they are here, and here to stay, and they are surely cashed up more than you could ever dream of... maybe you can direct your comment to the relevant segment, the middle-class who benefited over the past boom, but definitely not the rich. You want everyone to be poor don't you, it's kind of sad - but I have friends whose cars (and they are just their insignificant playthings) are probably worth more than all of your net worth + your boyfriend's as well...

[shochu]

midas,

i can not give u a definitive answer as i never really looked into it. ur answer seems quite reasonable. based on my experience and i wrote about this in the past - about how similar condos had a large variance in prices - i would say it could be two possible reasons: 1) someone is desperately trying to sell more than the other due to many reasons, (only paid deposit, needs money, lost job, etc.) or 2) one bought at pre-sale and the other bought later or from a flipper and for some reason both are trying to sell (due to need or profit). mind u, some people r too expectant on inflated prices.

i think u will start seeing more of these discrepancies in time as the realization hits that things are only just beginning to slow and will remain this way for an extended time and many of the renters for these condos do not materialize as many can not afford to just leave these units empty while some can.

what is real, is that commerce is coming to a grinding halt. i recently heard that some ships are being partly filled with things and sail out to the sea and anchor for a week and then come back with the same product but saying it comes from another country. i guess this is the small tick up in bdi numbers. thailand being very dependant on trade will suffer quite a bit and what most do not realize or want to see here is that this will mean many offices downsizing, which means less bodies for the condos. there was a much hushed internal mesage from a large japanese manufacturer that ordered their employees to send their families home from all overseas locations except singapore. and i have heard that many japanese co's here in thaialnd have also ordered their employees back. perhaps this is a possible explanation to the above.

jcon,

i don't know whether u r aware of how wealthy families' finances work. do u know these families intimate cash flow numbers? perhaps u do - i don't know. many wealthy families do not have a lot of cash in bank - well maybe a few mil here and there but when u consider their lifestyles, it is not a whole lot of money. yes they can buy a few condos here and there, but generally they have to move money/assets around constantly, or cash or sell an asset. it is not like they have wads of money at their disposal. most have a large company that they kinda use as a bank and can also be used to secure capital. how do i know - well i work for wealthy families. some of my clients own dozens of large buildings in major cities. there are families like this in every major city and sure they have money and expensive houses and can buy as many nice cars as they want - but one major hit on their assets will shake their other assets up either a bit or a lot - unless of course they are very cash rich and there arn't a whole lot of people like that around as most of the money is not in a ready cash form but more products - some more liquid than others.

[midas]

what is real, is that commerce is coming to a grinding halt. i recently heard that some ships are being partly filled with things and sail out to the sea and anchor for a week and then come back with the same product but saying it comes from another country. i guess this is the small tick up in bdi numbers. thailand being very dependant on trade will suffer quite a bit and what most do not realize or want to see here is that this will mean many offices downsizing, which means less bodies for the condos. there was a much hushed internal mesage from a large japanese manufacturer that ordered their employees to send their families home from all overseas locations except singapore. and i have heard that many japanese co's here in thaialnd have also ordered their employees back. perhaps this is a possible explanation to the above.

I am still reeling from the shock of finding out today that Thailand has only managed to pay

off 32 billion baht from its 1.4 trillion baht debt from 1997 ? That is abyssmal ,.......... Talk about the

land of smoke and mirrors and what happens to property developers who will

get into trouble this time because the cupboard is already empty

And now I know this - how on earth can the baht continue to be this strong

with this debt still overhanging the country from 12 years ago - its crazy

Edited February 12, 2009 by midas

[mommysboy]

what is real, is that commerce is coming to a grinding halt. i recently heard that some ships are being partly filled with things and sail out to the sea and anchor for a week and then come back with the same product but saying it comes from another country. i guess this is the small tick up in bdi numbers. thailand being very dependant on trade will suffer quite a bit and what most do not realize or want to see here is that this will mean many offices downsizing, which means less bodies for the condos. there was a much hushed internal mesage from a large japanese manufacturer that ordered their employees to send their families home from all overseas locations except singapore. and i have heard that many japanese co's here in thaialnd have also ordered their employees back. perhaps this is a possible explanation to the above.

I am still reeling from the shock of finding out today that Thailand has only managed to pay

off 32 billion baht from its 1.4 trillion baht debt from 1997 ? That is abyssmal ,.......... Talk about the

land of smoke and mirrors and what happens to property developers who will

get into trouble this time because the cupboard is already empty

And now I know this - how on earth can the baht continue to be this strong

with this debt still overhanging the country from 12 years ago - its crazy

Yes, but where did you get this info. from? have you a link?

It would be rather typical.

[thaihome]

I assume this is the article being refered to:

Knock knock

Another noted objective Thailand observer.

TH

[midas]

And now I know this - how on earth can the baht continue to be this strong

with this debt still overhanging the country from 12 years ago - its crazy

Yes, but where did you get this info. from? have you a link?

It would be rather typical.

mommy

I read it here yesterday...............

full article here - http://www.bangkokpost.com/business/econom...-debt-authority

[bingobongo]

have a great weekend

[bingobongo]

this would only come as a surprise to those in denial or deeply delusional

Sharp rise in business failures

Twelve per cent of shutdowns were construction, land, property-development or related businesses.

http://www.nationmultimedia.com/2009/02/23...ss_30096384.php

[hhgz]

"Twelve per cent of shutdowns were construction, land, property-development or related businesses. "

I guess that means that 88% of business shutdowns had nothing to do with land development, construction, or related businesses.

[corkscrew]

Is this the Regency?

[thaiwanderer]

http://www.property-report.com/property-ne...amp;date=260209

[hhgz]

"Is this the Regency"

No. If you mean "Regent", yes.

[ThaiPauly]

i too am curious which 12 projects are being scrapped....

One of them must be the second tower at Vista Gardens on Suk Soi 71.

They just about finished tower A , but tower B looks exactly the same as it did 2 years ago, there are never any lights on, luckiliy I got my deposit back...others have not been so lucky

Tower B was due for completion 3 years ago