Northshore - What Is Happening

[Thaifan2]

^ can you name a Condo block that has been knocked down just because its 30 years old ?

[123ace]

^ can you name a Condo block that has been knocked down just because its 30 years old ?

You beat me too it on this question! there is simply no precedent on this happeneing locally. The assumption for demolishing and re-building only makes economic sense if it is in a location that is in demand, and is more desirable than other locations with available development land at that time. Sadly as this is not likley to be the case for Pattaya (due to immense land availability), and this scenario will not apply, aside from truly special beachfront land - however this remains entirley hypothetical as a majority of co-owners would be required to agree.

The core structure of any condo will likley remain largely intact after 30 ++ years, leading to refurbs rather than demolishing, particularly as future building codes & permits will likely seek to reduce footpint sizes and buildable areas etc.

[Forkinhades]

tax free rental returns in the 12-16% range....

Note to self, KEEP bying properties in Thailand

yeah right

did you buy 20 years ago, and basing your yields on that price?

[LennyW]

^ can you name a Condo block that has been knocked down just because its 30 years old ?

Can you name a 30 year old condo block in Pattaya?

[FarangBuddha]

Many buildings have been/are torn down to the ground after their leasehold periods have expired and the land itself has reverted back to the landowner. This happens all the time in Bangkok and other Asian cities...countries where the ownership of land and the right to use/build on the land are separate ownership rights/interests. Many people from the USA especially, don't know about this concept or don't understand it as these two rights are generally merged in their country. If a Pattaya condo is a leasehold, it will happen here too. If the condo is freehold, it will just slowly fall apart and decline in value as it does.

The information about the 30 year lifetime design and build quality for condos in Thailand comes direct from a large Bangkok developer who was quoted in that other Bangkok newspaper that this is the case. It is no secret or anything...just a fact. As stated, it's because many buildings are built on 30 year leasehold land so why would a developer spend or maintain extra money on a property they will not even own after the 30 year lease expires.

I'm not saying anything about the build quality of Northshore or any other Parttaya condo (but having its superstructure sitting out in the sun, rain, and salt of Pattaya for 10 years I would have some doubts) as I don't know if they are freeholds or leaseholds. Just saying like others have that condos generally slowly decline in value in Thailand as they are not built to last and there is plenty of new land (even in Bangkok) to build new ones (never a shortage...which drives prices up in other urban areas in other countries).

^ can you name a Condo block that has been knocked down just because its 30 years old ?

You beat me too it on this question! there is simply no precedent on this happeneing locally. The assumption for demolishing and re-building only makes economic sense if it is in a location that is in demand, and is more desirable than other locations with available development land at that time. Sadly as this is not likley to be the case for Pattaya (due to immense land availability), and this scenario will not apply, aside from truly special beachfront land - however this remains entirley hypothetical as a majority of co-owners would be required to agree.

The core structure of any condo will likley remain largely intact after 30 ++ years, leading to refurbs rather than demolishing, particularly as future building codes & permits will likely seek to reduce footpint sizes and buildable areas etc.

Edited March 8, 2010 by FarangBuddha

[LennyW]

As stated, it's because many buildings are built on 30 year leasehold land so why would a developer spend or maintain extra money on a property they will not even own after the 30 year lease expires.

This is very often the case, particularly with beachfront properties.

[gk10002000]

tax free rental returns in the 12-16% range....

Note to self, KEEP bying properties in Thailand

Tax free returns? If you are a US citizen, the US internal revenue service (IRS) would probably take exception to your claim. The US Federal govenrment in general taxes anything a US citizen makes anywhere. Of course, there are some corporate work arounds.

[123ace]

I really disagree with this assumption that builidngs are built with a 30 year intended lifespan.

Firstly, 30 years leases in Bangkok are necessitated by the land title such as CPB or State Railway land etc, as such this is why the builings located on leasehold land have leashold title. This may apply for some high rise resort property, though overwhelmingly not condos (titled in this case as apartments) and for different reasons.

In Bangkok I can think of very few ‘modern’ buildings that have been knocked down. By ‘modern’ I am referring to purpose built developments sold to multiple third parties, built since the 70’s. There are lots of recent examples of older buildings from the 70’s that have been gutted to shell and core and refurbished, but few high rises that have been demolished for redevelopment due to a purpose built limted life span. Feel free to name some though.

From a construction perspective my understanding is that buildings here are often ‘over specified’ in terms of steel rebar and this why the shell and core is so robust.

Both Hong kong and Singpaore are on the beach and they seem to be doing ok, including builings still standing from the 1800's...let alone the 1960's.

Plenty of Pattaya conods have passed the 20 year mark and whilst the poorly maintained ones are a mess, this would apply to any poorly maintained property anywhere in the world. There are no significant leashold high rise apartments in Pattaya, in fact I can't readily think of any.

[soundman]

tax free rental returns in the 12-16% range....

Note to self, KEEP bying properties in Thailand

Surely that depends on whether you are a resident (more than 180 days within a calender year in Thailand), or a corporate entity, or just dodging the taxman.

Looking at PIT, this revenue department guideline, you are allowed a 10% deduction of gross rental return with the remainder being assessed as personal income tax.

For CIT, according to this revenue department guideline, you are supposed to pay at a minimum, 15% of profit as CIT.

[Rimmer]

BIG SNIP

Both Hong kong and Singpaore are on the beach and they seem to be doing ok, including builings still standing from the 1800's...let alone the 1960's.

I do not remember any beach front condo's in Singapore, I remember Marine Parade condo's all having the land to the sea side being re claimed and further buildings being built in front of them. The older condo's being sold 'On Block' then knocked down and re developed. As Singapore grows this is happening more and more.

The only buildings still standing from the 1800s are two story shop houses with a preservation order on them.

Such as China Town and Primrose Hill.

[123ace]

BIG SNIP

Both Hong kong and Singpaore are on the beach and they seem to be doing ok, including builings still standing from the 1800's...let alone the 1960's.

I do not remember any beach front condo's in Singapore, I remember Marine Parade condo's all having the land to the sea side being re claimed and further buildings being built in front of them. The older condo's being sold 'On Block' then knocked down and re developed. As Singapore grows this is happening more and more.

The only buildings still standing from the 1800s are two story shop houses with a preservation order on them.

Such as China Town and Primrose Hill.

There remain some colonial govt buildings (like the post office now converted to the Fullerton hotel) that exist as well as many old villas (called bungaloes) and churches etc.

Singapore has scarcity of land, strict building controls and zoning and these limitaions drive redevelopment by creating opportunity. I see any part of Singapore or HK as being costal (rather than beachfront) if you can see the sea. Technically Northshore is not beachfront and my angle is that high rise condo buildings are not built with a 30 year life span.

The original sea frontage in HK still exists from Wanchi to Central as inland roads now, with many colonial era builings still in place such as the Wanchai police station. Many decades ago these buildings were literally battered by the sea during typhoons, and yet they are still there today.

But I am happy for a developer or major construction party to correct me as I would like to know if this is the case locally regarding 30 years life span only (so I can become quietly worried!).

[CHdiver]

I think this is the biggest problem with condos in Thailand. If you look at them after ten years they look old and even if condo prices have gone up 30%, the older buildings prices havent moved. Lets say you are paying Bt40/sqm/month that is Bt8,000 for a 200sqm condo. That should be enough to get things by but with little left over. Lets say your condo is worth Bt50,000sqm and you increased common area fees by Bt5,000 (surplus money that can be spent maintaining the place). That equates I think to 0.6% of the value of the property per annum. It just seems virtually impossible to me that, that 0.6% investment wont add value and if you dont pay at least that over running costs the value of property will decline.

Hmm, View Talay1/2 sold for about 4 to 600 k Baht if I am no wrong. Not sure if you would find one for that price. Anket got a renovation and is selling Condos now in the 900k price range, probably also a little bit more then when they where built. Sure many other examples around

Edited March 8, 2010 by CHdiver

[fredKroket]

tax free rental returns in the 12-16% range....

Note to self, KEEP bying properties in Thailand

Note to DonTron, agreed, easily accessable ROI if property in right condition, in right location, without much competition

[fredKroket]

tax free rental returns in the 12-16% range....

Note to self, KEEP bying properties in Thailand

Rental yields in Thailand have been under 8% for a while now and dropping like a big rock. You are either a brilliant business man or incredibly lucky.

http://www.globalpropertyguide.com/Asia/Th...d/Rental-Yields

Agreed if you rent out a condo in something like a view talay, where there is so much competition, where everyone scrambles for the same tenant, or in east pattaya where there is an over supply of vacant houses. If you use your head, buy in smaller developments, possibly in company name in a good location there is noting stopping you from achieving what DonTron does!