Property Market Likely To Recover In 2nd Half Of 2010

[webfact]

Property market likely to recover in 2nd half of 2010

BANGKOK: -- The property market is projected to recover and resume its growth as usual in the second half of this year because the real demand by potential homebuyers who postponed their purchase decision due to the political unrest in the first half of the year remains intact,

and property developers are launching new projects to accommodate the demand, according to the Bank of Thailand (BoT).

Mathee Supapongse, director of the BoT Domestic Economy Department, said the sector conditions in May began to pick up in tandem with the country’s overall economic recovery although it had been affected by the recent political mayhem in the short run.

This could be witnessed by a surge in the number of housing projects offered for sales in Bangkok and its environs by 54.2 per cent from the previous month, and total sales in new projects rising by 23.3 per cent from 13.1 per cent the month before.

In April, the property market conditions shrank due to the political unrest, which had shaken confidence among consumers and property developers. Also, there are many public holidays in that month.

The demand for single-attached and twin-attached houses contracted with house ownership transfers dropping 80.2 per cent from the previous month

and 21 per cent from the same month the year before. So did the supply with the number of registered and completely built houses decreasing 25.9 per cent from the previous month.

The demand for townhouses and commercial buildings also dropped with the ownership transfers shrinking 74.5 per cent from the previous month and

1.9 per cent from the same month last year.

So did the demand for condominiums with ownership transfers decreasing by 83.1 per cent from the previous month. However, total sales of condos

grew 12.6 per cent from the same month last year because the real demand for condos for living and investment remains intact.

Mr Methee also disclosed that outstanding personal loans for property extended by commercial banks grew 15.1 per cent from the previous month while the outstanding loans for property developers dropped 9.6 per cent from the month before because more developers turned to raise funds through the debt instrument issuance. (MCOT online news)

-- TNA 2010-07-02

[123ace]

For the avoidance of doubt this report relates to the domestic housing market only, which were led to believe was doing very well anyway.

The foreign specific sector will not recover any time soon and will continue to be an unrelated industry to the local market in many respects.

[craigt3365]

We just finished our house off, but needed a few extra things done. The original contractors are booked. No time to work with us...even though they have become good friends and their families even stop by from time to time to say hello. They are both too busy to take on another project.

Found another contractor, and he is jammed, but fitting us in from time to time. So, something must be making them busy....

[Seizetheday]

Yes my wife's house in Pattaya has increased in value by 10% a year for the last 2 years, she is just about to sell it for 1.7m Baht. Meanwhile a village I've got my eye on has had houses increase from 9.5m Baht to 10.9m Baht since 2006.

Edited July 2, 2010 by Seizetheday

[123ace]

The signs are the condo market will in fact see a correction (reduced asking and transcated values psm) in the short to medium term. With 100% financing now available for some developments and a local reseach body suggesting that condo developers in Bangkok slow down or delay new launches due to the oversupply developing in the mid market condo sector.<BR><BR>

[PattayaParent]

^it would need 100% financing terms of 'you only pay when it's finished' to get the Pattaya market moving judging by all the halted and not yet started 'developments' around the place.

[yabaaaa]

I dont know what will happen, I have a feeling things are going to get much worse but the problem is where or what do you put your money in if you have any? Real assetts land and houses..........at least it will still be there in 5 years............hopefully.

[123ace]

The Pattaya market is really not relevant as the Thai condo rush never started in pattaya (as in developements by mass market Thai developers aimed at the local market). In Pattaya, it has been an excessive volume of new supply from mostly foreign developers with very limted exposure to the local banks by the developers or purchasers, so Pattaya will likely just plod along as is, i.e. slow and steady with some downward pressure but not likley a crash.<BR><BR>

[trogers]

The Pattaya market is really not relevant as the Thai condo rush never started in pattaya (as in developements by mass market Thai developers aimed at the local market). In Pattaya, it has been an excessive volume of new supply from mostly foreign developers with very limted exposure to the local banks by the developers or purchasers, so Pattaya will likely just plod along as is, i.e. slow and steady with some downward pressure but not likley a crash.<BR><BR>

The dual pricing in Pattaya, one price for foreigners and a lower price for locals, points to a poor local market. Where is the rush?

[craigt3365]

The Pattaya market is really not relevant as the Thai condo rush never started in pattaya (as in developements by mass market Thai developers aimed at the local market). In Pattaya, it has been an excessive volume of new supply from mostly foreign developers with very limted exposure to the local banks by the developers or purchasers, so Pattaya will likely just plod along as is, i.e. slow and steady with some downward pressure but not likley a crash.<BR><BR>

The dual pricing in Pattaya, one price for foreigners and a lower price for locals, points to a poor local market. Where is the rush?

Or a (previously) hot foreign market?

[trogers]

The Pattaya market is really not relevant as the Thai condo rush never started in pattaya (as in developements by mass market Thai developers aimed at the local market). In Pattaya, it has been an excessive volume of new supply from mostly foreign developers with very limted exposure to the local banks by the developers or purchasers, so Pattaya will likely just plod along as is, i.e. slow and steady with some downward pressure but not likley a crash.<BR><BR>

The dual pricing in Pattaya, one price for foreigners and a lower price for locals, points to a poor local market. Where is the rush?

Or a (previously) hot foreign market?

Lukewarm, hot for half the buildings...

I suspect 30-year leasehold projects may do better in Pattaya, and lesser number of buildings will be needed as 100% foreign holdings is possible. The foreign buyers are mainly retirees.

Edited July 9, 2010 by trogers

[Pakboong]

The global property guide has property in all of Thailand off 16.98% for the past year, I expect Pattaya is at least twice that for the same period. Anyone thinking otherwise, is dreaming.

http://www.globalpropertyguide.com/Asia/price-change-1-year/

Edited July 10, 2010 by Pakboong

[craigt3365]

Yeah, well that link brought me to this:

http://www.ulikaiser.de/Zeitraffer/Pattaya_2015_Webinars.html

Now I will just have to wait until 2015!

[hansum]

The global property guide has property in all of Thailand off 16.98% for the past year, I expect Pattaya is at least twice that for the same period. Anyone thinking otherwise, is dreaming.

http://www.globalpro...-change-1-year/

Why how can you post such nonsense, everyone knows the value of property only goes up.

[quiksilva]

Its been mentioned before but its worth mentioning again, but I think their site, still has an over reliance on BOT stats.

I understand why though, because the BOT provides the only official property market index from a disinterested 3rd party. This is what most professional research teams in more sophisticated markets rely on for their analysis.

However, the problem here lies not with the approach, but with the data itself. BOT stats are still primarily concerned with detached housing which tends to be properties of less than Bt 5mn, in peripheral locations.

This detached housing sector is of course a local market and by far and away the biggest market segment, but its movements have little effect on the condominium markets of resort destinations or CBD Bangkok, which are driven by an entirely different set of factors, and I guess will be of most interest to TV'ers here.

To its credit the global property guide has also started incorporating research and views from most of the major international property consultancies. My firm's view, which is not particularly upbeat (like most others), can also be found via a link on their website.

Edited July 12, 2010 by quiksilva

[PaddyThai]

Anyone know how rural agricultural land prices are doing or a link to a web site that tracks them.

I am particularly interested in famland in Chaiyaphum and want to see if prices have risen in past 5 to 10 years.

[bkk_mike]

All I know is - we bought a 2-bed condo in July on a high floor in a building that is literally next to a skytrain station, and we've already had offers to buy it for a 900K more than we paid for it.

(We don't actually live in it, so it's still "new" as far as Thai buyers are concerned.)

We have our house on the outskirts of Bangkok that we actually live at, but I can see other people wanting to buy a place in the centre to use during the week too. (The other advantage is the condo can get 16Mbps, where my house currently has only 1Mbps - although True have recently admitted they can upgrade my line here to 2Mbps now...)