3 Things that will make your relationship successful in Thailand

[sharecropper]

I have been away for 2 months, so now I'm back and the burning rubber smoke clouds have lifted over Bangkok, I am left wondering, how is Pattaya real estate doing? Doldrums, quiet optimism? Or what? Any news on the stalled developments we always hear about imminently breaking ground, or observations on price movements/discounts etc?

Many thanks.

[PattayaParent]

Same as before you went, still booming according to the developers and real estate agents.

Buy now before they all sell out!! [sarcasm font off]

[123ace]

Prices and rents seem to be maintaining their slow downward spiral. Although I have met with a few mindlessly optimistic developers that seem to think that their latest condo-prison-combo will beat the trend of a decade actually make them some money...

[sharecropper]

Prices and rents seem to be maintaining their slow downward spiral. Although I have met with a few mindlessly optimistic developers that seem to think that their latest condo-prison-combo will beat the trend of a decade actually make them some money...

How is the psm price for seaview condos near the beach holding up (I am thinking of the new (seemingly still very poorly occupied) View Talay blocks in Jomtien). Also, how is demand for VT7? Someone tlod me there is another (ie not Jomtien Complex) lawsuit filed. Do you know if that's true or confusion with the JC lawsuit?

Are we yet in firesale territory, or do you think there is much further to fall?

[SUPERIOR]

I own 14 condos in Pattaya for my sins, Ten of those are rented out,3 Empty,1 being renovated.8 of the ten rooms rented have long term tenants.

I have dropped rent Rates considerably Though.I wouldnt even bother myself trying to sell anything at the moment its so Quiet.

[homeseeker]

Pattaya real estate: supply massively exceeding demand.

So I hope that owners/landlords will negotiate realistic rental prices.

Message to tenants: do not be fooled into paying nonsensically high rents!

[sharecropper]

I own 14 condos in Pattaya for my sins, Ten of those are rented out,3 Empty,1 being renovated.8 of the ten rooms rented have long term tenants.

I have dropped rent Rates considerably Though.I wouldnt even bother myself trying to sell anything at the moment its so Quiet.

What kind of percentage drop in rent have you given over, say, a 3 year time period? And just out of interest are your tenants holidaymakers, workers or retirees? And which county/ies are they from?

Someone told me a while back that Russians are making headway in the lower end of the rental market, but there don't even to be many of those around at the monent.

[SUPERIOR]

Hello Sharecropper, I have 3 Germans renting out 3 rooms,1 Australian,1 American,2 Hungarians,2 English,1 French.

All the Germans work here,Australian retired,american Retired,2 Hungarians (don't have a clue to be honest)english on Holiday.French also.

Units size between 74 -90 sqm 3 years ago i could rent out for between 28-35 in High season,20-25 low season,i now rent out between 15-20 thousand.

A couple of 2 bedroom untits from 148 sqm to 200 sqm i could rent 3 years ago for between 40-55 (high season)Low season Between 35-45

I now rent those units for between 25-30.

I regret buying so much real estate here and am somewhat embarresed but no point crying over spilt Milk Now.

On that not i shall now go out and get myself a stiff drink.

Cheers

[123ace]

Hello Sharecropper, I have 3 Germans renting out 3 rooms,1 Australian,1 American,2 Hungarians,2 English,1 French.

All the Germans work here,Australian retired,american Retired,2 Hungarians (don't have a clue to be honest)english on Holiday.French also.

Units size between 74 -90 sqm 3 years ago i could rent out for between 28-35 in High season,20-25 low season,i now rent out between 15-20 thousand.

A couple of 2 bedroom untits from 148 sqm to 200 sqm i could rent 3 years ago for between 40-55 (high season)Low season Between 35-45

I now rent those units for between 25-30.

I regret buying so much real estate here and am somewhat embarresed but no point crying over spilt Milk Now.

On that not i shall now go out and get myself a stiff drink.

Cheers

Superior - thanks for the info. This from the source data is very interesting and backs up what many would expect but is hard to substantiate.

May we assume all the tenants are male and aged over 50? (retirees aside).

Whilst the market is likley to remain very subdued for potentially many years to come, we may see an increase in older european males looking to escape europe as they apparoach early retirement, perhaps post divorce, and this group should continue to help with new funds entring the market in small but steady increments. I can't see the Russian market supporting the long term rental or holiday home market in significant numbers.

[Rimmer]

Meanwhile outside of Pattaya City, three 20m baht houses (when first released on the market) close to us on the edge of Phoenix golf course now have a 7.5m baht sign outside them. I would expect they can sell at that price even with the state of the market, but it is indicative that the owner must be hurting and wants rid of them at any price.

Also drove around the back roads round Hue Yai the other day, the amount of unfinished shells and empty houses for sale is staggering.

[sharecropper]

Great info Superior. many thanks. Very interesting mix of nationalities.

I imagine your occupancy rate will be the envy of many, and at least you are getting a decent income stream which is what bothers me most here, that I have to import all my money each month at these rates!

Rimmer - a 63% discount is remarkable. In fact it sounds TOO good! When were they originally released on the market at 20M?

[Zstarx]

Hello Sharecropper, I have 3 Germans renting out 3 rooms,1 Australian,1 American,2 Hungarians,2 English,1 French.

All the Germans work here,Australian retired,american Retired,2 Hungarians (don't have a clue to be honest)english on Holiday.French also.

Units size between 74 -90 sqm 3 years ago i could rent out for between 28-35 in High season,20-25 low season,i now rent out between 15-20 thousand.

A couple of 2 bedroom untits from 148 sqm to 200 sqm i could rent 3 years ago for between 40-55 (high season)Low season Between 35-45

I now rent those units for between 25-30.

I regret buying so much real estate here and am somewhat embarresed but no point crying over spilt Milk Now.

On that not i shall now go out and get myself a stiff drink.

Cheers

It's good that you can let everyone know your experience, at least you don't have problems with currencys going down against the Baht

[Thailaw]

Rimmer - a 63% discount is remarkable. In fact it sounds TOO good! When were they originally released on the market at 20M?

If you consider the reduction in the value of the Pound over the last 3 years and assume that the developer has had enough of the housing market here (good decision) and is taking the sale proceeds back home, the reduction (in Pound terms) is only about 43% (L285,714 down to L163,043). Still a very substantial reduction in price, but given the very substantial markups on houses and condos in Thailand, the seller probably just about breaks even at that price.

[Rimmer]

Rimmer - a 63% discount is remarkable. In fact it sounds TOO good! When were they originally released on the market at 20M?

Finished maybe one year to 15 months back but nary a prospect during that time, nice houses too.

[Guderian]

Prices and rents seem to be maintaining their slow downward spiral. Although I have met with a few mindlessly optimistic developers that seem to think that their latest condo-prison-combo will beat the trend of a decade actually make them some money...

How is the psm price for seaview condos near the beach holding up (I am thinking of the new (seemingly still very poorly occupied) View Talay blocks in Jomtien). Also, how is demand for VT7? Someone tlod me there is another (ie not Jomtien Complex) lawsuit filed. Do you know if that's true or confusion with the JC lawsuit?

Are we yet in firesale territory, or do you think there is much further to fall?

VT7 seems to have a pretty low occupancy rate at the moment. To judge by obvious signs of habitation like AC units, lights, stuff on the balconies, and so on, most of the units currently occupied are on the south side of the front leg of the building (the section perpendicular to the beach). Some of the units on the north side of that leg are occupied, but not many at present. I assume that's because of the uncertainty previously over what was going to be built on the land next door - who would want to buy a place looking directly into another VT5 building?

The rear two wings that are built parallel to the beach seem almost entirely deserted. Hardly any AC units and no lights at night. Of course, that doesn't mean that the units haven't been sold. These rear rooms look larger than those in the front part of the building, so are probably more expensive - is that right? If (as seems to be the case) many of these rooms are unsold, I wonder how long it will be before VT start offering large discounts?

BTW, I wouldn't go for a top floor room in VT 7 because of the 'green roof' forced on them by Pattaya City Hall. How long will it take for the damp to penetrate through the ceilings of those rooms, I wonder?

[proximity]

I regret buying so much real estate here and am somewhat embarresed but no point crying over spilt Milk Now.

On that not i shall now go out and get myself a stiff drink.

What are your yields like? When I first bought my rentals I was making 12%, now that rents are down I make 8%. However, 8% is still better then what I am getting on my money elsewhere.

[jori]

It's nothing about yields or rents in the long run,it's the freedom to cut and run when you want to get out, because old age,the heat ,infimity,lack of funds or whatever will catch everyone out.

Property market here is moribund,deader than dead,and getting worse,OK property owners do not want to even consider a potential loss on selling,but that's the way it will happen if they need to get out of Thailand, however a burial plot or funeral pyre location on their property will overcome that problem.

All those countries that many people bought for second homes,investment etc are all devastated ,seems as though Thailand was last into the mess but it sure will go deeper here. personally I think Thailand will change,more two or three week punters arriving ,but long stayers,residents etc leaving,the exchange rate is making more than a few consider packing their bags sooner than later,mine included(along with another reason) Buy in Thailand and your virtually trapped for the rest of your life.

[SUPERIOR]

Jori i understand what your saying but as far as my personal situation Goes i am certainly not trapped.Even if i couldnt ever sell anything ever again i would still be fine.

I can walk away from Thailand anytime i want.

123Ace most of my tenants are over 50 Except for the 2 Hungarians.

Sharecropper thankyou for your post and Pm,my occupancy Rates are very good, I put that down to the Realistic Rates i charge.

Zstarx i share your opinion

Proximity my Rates have dropped significantly but the plus side is i have a better occupancy Rate as far as long term tenants then say 3/4 years ago.

So not all doom and gloom by any means.

[BobbyMoore]

Buy in Thailand and your virtually trapped for the rest of your life.

Sounds great.

[jori]

Jori i understand what your saying but as far as my personal situation Goes i am certainly not trapped.Even if i couldnt ever sell anything ever again i would still be fine.

I can walk away from Thailand anytime i want.

..but you need to take your assets away out of Thailand,it's no good keeping to looking over your shoulder at what's left behind,no matter how much you have got left to carry on with the rest of your life.It needs closure and that will not be achieved here in Thailand

[SUPERIOR]

I understand Lori, but that is your opinion not mine.Who knows what may happen in the future.

I appreciate your comments.

Cheers

[123ace]

I hold a very Cautious outlook for the Pattaya real estate situation and would not be surprised if we see an almost continual stream of new and new-ish developers continue to pump the market with stock. This will inevitably continue to keep the level of supply in excess of the level of demand for decades. Over the next few years we will see many existing freehold condos become depreciating assets due to poor facilities management and local environment degradation.

Only the best of the existing supply will prosper, where a good building, with good units in a well maintained location are able to hold values over time.

Does anybody know how The Cliff in Pratumnak hill is doing? I hear they have sold as many as 300 units, if so expect many, many more to follow…

[moo9]

I hold a very Cautious outlook for the Pattaya real estate situation and would not be surprised if we see an almost continual stream of new and new-ish developers continue to pump the market with stock. This will inevitably continue to keep the level of supply in excess of the level of demand for decades. Over the next few years we will see many existing freehold condos become depreciating assets due to poor facilities management and local environment degradation.

Only the best of the existing supply will prosper, where a good building, with good units in a well maintained location are able to hold values over time.

Does anybody know how The Cliff in Pratumnak hill is doing? I hear they have sold as many as 300 units, if so expect many, many more to follow…

Same talking for years. BUT, why banks support all these projects if all are heading for bankruptcy?

However, I would not buy for speculation reasons now. One can be happy to rent out a nice condo to reliable people at prices which are 30-40 % below the levels 2-3 yrs ago.

I do not believe in the excess supply for luxury condos. Those are way overpriced and Pattaya will not become as fancy as the developers want it to become (FORTUNATELY!).

If you observe the market there is now a trend for cheaper, smaller sized projects as well, which can be bought at much more reasonable prices.

Cheers

[moo9]

Buy in Thailand and your virtually trapped for the rest of your life.

Still prefer to be trapped here than in some other countries. As long as there will be no political chaos in BKK, the SEA economy will be doing much better than Europe/US. That's for sure.

[123ace]

I hold a very Cautious outlook for the Pattaya real estate situation and would not be surprised if we see an almost continual stream of new and new-ish developers continue to pump the market with stock. This will inevitably continue to keep the level of supply in excess of the level of demand for decades. Over the next few years we will see many existing freehold condos become depreciating assets due to poor facilities management and local environment degradation.

Only the best of the existing supply will prosper, where a good building, with good units in a well maintained location are able to hold values over time.

Does anybody know how The Cliff in Pratumnak hill is doing? I hear they have sold as many as 300 units, if so expect many, many more to follow…

Same talking for years. BUT, why banks support all these projects if all are heading for bankruptcy?

However, I would not buy for speculation reasons now. One can be happy to rent out a nice condo to reliable people at prices which are 30-40 % below the levels 2-3 yrs ago.

I do not believe in the excess supply for luxury condos. Those are way overpriced and Pattaya will not become as fancy as the developers want it to become (FORTUNATELY!).

If you observe the market there is now a trend for cheaper, smaller sized projects as well, which can be bought at much more reasonable prices.

Cheers

I would like to agree but I am seeing signs that floods of new buildings are on their way. The trend is for smaller and cheaper as well, so the window of opprtunity in the one area that worked is potentially limited.

Banks don't support these projects. The land costs from US 500,000 to 3 million US and it is normally a cash funded buy by a wealthy individual, often with non-resident investors. The architects, ad desigsn etc are all quite cheap and the intention is for construction to be largely self funded by buyers. Bank exposure is almost a non issue.

[sharecropper]

123ace re your comment: "Bank exposure is almost a non issue. " in relation to 2 other projects:

1. La Royale - do you know if it ever got its final bank funding to finish the development properly?

2. In connection with the supersized Jotmien 90 storey project which we aren't seemingly allowed to mention, do you know whether that was going to be bank-funded, which I would expect, and if so, how that is going? No recent announcements about funding or construction anywhere?

Cheers.

[Zstarx]

I thought for projects to be a goer you need to pre sell a certain amount of units, I would have thought a wealthy private individual or a bank would have similar criteria to approve a deal?

[sharecropper]

I thought for projects to be a goer you need to pre sell a certain amount of units, I would have thought a wealthy private individual or a bank would have similar criteria to approve a deal?

I suppose that depends on how dodgy the dosh is, especially here!

[Zstarx]

I thought for projects to be a goer you need to pre sell a certain amount of units, I would have thought a wealthy private individual or a bank would have similar criteria to approve a deal?

I suppose that depends on how dodgy the dosh is, especially here!

True

[123ace]

123ace re your comment: "Bank exposure is almost a non issue. " in relation to 2 other projects:

1. La Royale - do you know if it ever got its final bank funding to finish the development properly?

2. In connection with the supersized Jotmien 90 storey project which we aren't seemingly allowed to mention, do you know whether that was going to be bank-funded, which I would expect, and if so, how that is going? No recent announcements about funding or construction anywhere?

Cheers.

Sharecropper, I don't have confirmed answers on either, although I have heard rumors that some unit owners at La Royale have moved out recently.

For the bldg that can't be mentioned, again no news.

On a similar note Waterfront's showoom is shut and The Beaches has a few workers that appear to be piling and building perimiter walls.