Samui, Phangan Land Prices Overvalued?

[Boater]

THE Chamber of Commerce of Suratthani has issued an urgent letter to the Finance Ministry to protest what it thinks are the overly high prices of lands fixed for Koh Samui and Koh Phangan by the Treasury Department. The prices represent an average increase of 200 percent. It said the land valuations were higher than the actual market prices. Theerakit Wangmutitakul, the Chamber president, told Finance Ministry caretaker Korn Jatikavanit that the new land prices set by the Treasury Department for 2008-11 did not reflect the real prices in the market and that they could be detrimental instead of helpful to the two islands’ economies.

Mr. Theerakit said property investors would be discouraged to put their money in Samui and Phangan because the new land prices are too high, and might instead move to other destinations.

The Chamber’s letter complaint was sent after landowners affected by the new land prices expressed their apprehension to the Chamber. Theerakit urged the Treasury Department to reconsider the new land prices it has set for the two islands.

“On behalf of the private sector, we would like to ask the concerned agencies and officials to consider the land prices which have recently been adjusted; the prices do not reflect the actual market and economic situation on Koh Samui. The exaggerated increase can result in the suspension of the economic growth and block potential investors and land purchasers from choosing Samui and Phangan as their investment destinations,” Theerakit said.

Theerakit said that they proposed more realistic land price adjustments for consideration by the Treasury Department “so that we can have the real prices that are not so high like what the Treasury Department has set."

Meanwhile, Rep. Choomphol Kajana, a member of the Democrat Party from Suratthani, said he has also received a letter from those who are affected by the “inflated” land price valuations and that he was ready to coordinate with the Finance Ministry to solve the problem.

A source from the Treasury Department has admitted that the land prices on Koh Samui and Koh Phangan it set were in fact higher than their real prices and that when the prices were fixed, the department factored in the highly competitive market, wherein prices move up continually. The source added that the Treasury Department was in the process of readjusting the new prices to reflect the reality in some areas. But the Treasury Department said that land prices on Koh Samui and Koh Phangan could not be brought down because they are major tourist destinations where land prices are boosted up all the time. It claimed that in some areas, the real land prices are higher than what the Treasury Department has evaluated. For example, from Chaweng beach to Laem Son within 60 meters from the sea, the land price in 2004-07 was Bt 2,500-Bt10,000 per 4 square meters, but the land price in 2008-11 is Bt 6,250-Bt50,000, or an increase of 150-400 percent.

The old price of land in Lamai beach within the range of 40 meters from the sea was Bt5,000-Bt 7,500 per 4 square meters, but now it is Bt35,000, or a 366.66-600 percent increase.

In Koh Tao and Koh Nang Yuan the old price of land within 40 meters from the beach was Bt750 per 4 square meters, but the price now is Bt8,000, an increase of 966 percent. —

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[Northbank]

If higher land prices contribute to halting or slowing the development on Samui down thats got to be a good thing, long may it continue.

[suegha]

I hadn't thought about it like that Northbank. Hmmmn...

[ESB7]

I am visiting Samui this week for the purpose of purhasing some land.....my research has shown that over the past 2 years prices have actually collapsed rather than become more expensive.....Of course there will always be land owners asking high prices but that land never sells.....