Buying A Discounted Condo - Any Advice?

[craigt3365]

I have seen plenty of 20%+ discounts from farangs who say they are leaving Thailand. But I'm not sure whether the discounts are real, because Thai sellers may be asking inflated prices.

Depending on which building you are interested in, there may be a huge difference in both value and asking price between farang-owned units and Thai-owned units. It all depends on the quotas.

This is certainly the case in many Pattaya buildings. Indeed there are several buildings here where many Thai-name quota units remain unsold from the developer after several years, even in nice buildings that command high prices per sqm.

I've also seen these buildings. Farang quota sold out, Thai quota open and discounted from the farang price. But if purchased, is the rental market here still good? I think less and less farangs are traveling now...or maybe they are staying here to save money!

[Darrel]

I've also seen these buildings. Farang quota sold out, Thai quota open and discounted from the farang price. But if purchased, is the rental market here still good? I think less and less farangs are traveling now...or maybe they are staying here to save money!

I can only comment on Pattaya.

One of the phrases one often hears here is "you can get X thousand Baht/month for that unit". Particularly common coming from estate agents trying to sell you property.

What they often forget to add is "in the high season, which lasts about 3 months". The rest of the time you will be quite lucky to rent it at all, unless you are prepared to make a significant reduction in the asking price from the high season price.

Also I am concerned about the huge numbers of units due to arrive on the market over the next 2 or 3 years. For me, every new unit sold may be one less potential renter and one more potential letting unit.

[craigt3365]

I've also seen these buildings. Farang quota sold out, Thai quota open and discounted from the farang price. But if purchased, is the rental market here still good? I think less and less farangs are traveling now...or maybe they are staying here to save money!

I can only comment on Pattaya.

One of the phrases one often hears here is "you can get X thousand Baht/month for that unit". Particularly common coming from estate agents trying to sell you property.

What they often forget to add is "in the high season, which lasts about 3 months". The rest of the time you will be quite lucky to rent it at all, unless you are prepared to make a significant reduction in the asking price from the high season price.

Also I am concerned about the huge numbers of units due to arrive on the market over the next 2 or 3 years. For me, every new unit sold may be one less potential renter and one more potential letting unit.

Right...one reason I am looking at the Thai market...but just starting to look now.

[happyfish88]

Great replies from London and Darrel. Thanks. Here are some additional thoughts from me.

Darrel - do you know why these units in Pattaya are being sold at a discount? Is it possible that these are the real prices and the more expensive ones in the building are just advertised at unrealistic prices that don't sell. If I had two condos next door to each other that were worth 4m each, I could put on sale for 5m and say the other is on sale at 4m (a 25% discount). In reality there is no discount at all. But maybe something else is going on in Pattaya. People talk of Pattaya booming, but I think they mean there is a construction boom and not a price boom. Personally I don't buy lifestyle property, as I think it is too risky. Yes, I'm sure you can make lots of money if you know what you're doing, but when there is a recession, property price correction, or something similar, then these are the first properties to be ditched.I would rather invest where there is a local market and where people want to and need to live. For me that is safe, but that's just my personal choice. But thanks for pointing that out. I know you can get properties at 20% discount almost anywhere in the world. Maybe not in every area and not all the time, but I'm in no rush. Look at any market and eventually a problem arises to correct prices. The same will happen in Pattaya. It may be the in place now, but fashions change and soon another country will be the in place and Pattaya property won't seem such a good investment. I remember people telling me about how Dubai was such a fantastic opportunity that I would kick myself if I missed it. And we all know what happened there. Risky investments can bring big rewards and big losses. Nothing wrong with that, but just not what I want.

What sort of property have you been buying in BKK? You say to go with my gut feeling, but my gut feeling is that something is terribly wrong here. The more I investigate, the more it seems that there is a huge oversupply of property. There may be particular reasons in certain buildings, but for example, I saw a condo advertised in Yen Akart. The advert said that only a few units were left for sale. And this was in a building that was completed two years ago. So I doubt they have raised prices, which means that in that particular building prices haven't risen at all in two years. Take inflation into account and it means they have dropped.

I also came across this, which sounds pretty alarming to me...

Its figures show there were more than 135,000 unsold property units in Bangkok and its suburbs as of July 2011, including projects under construction. Another 100,000 units are expected to come in to the market next year.

AREA president Sopon Pornchokchai said he could foresee an "upcoming bubble".

"If something happened to our economy or politics, it could cause the bubble to burst," he said.

I was looking for a rental property for myself a few months ago and almost every building I visited had many properties for rent and/or sale. It's just not something I'm used to seeing in the UK.

London mentioned hi-end condos. I also read about this. They were called super-prime, with the latest example being MahaNakhon next to Chong Nonsi BTS. They are doing roadshows in Hong Kong and Singapore, and rich buyers from these areas want to diversify and see Bangkok as a good investment. Super prime is in a class of it's own though. Super prime properties in London have gone up in price substantially in London in the last 2 years, while some parts of London and most of the UK have see prices falling.

So I'm starting to get a better picture of the property market here and still think things could fall apart. But it could also carry on and take off again. So I want to be at least a little cautious. I want to buy in a better area of Silom, Sukhumvit and not further out. along BTS lines. When things fall apart it is the less desirable areas that tend to suffer the most.

So, London, that's why I'm interested to know what types of properties have worked for you. And are the management of buildings pretty open to giving out past sales data? And can they be trusted? And how do you source the properties you buy - estate agents, private sales, just checking buildings yourself, friends?

My other option is to buy somewhere that I would actually be happy to live myself, as then even if I was stuck with the property, I could still use it myself. I am planning to stay a while, so maybe this could be my first step into the market.

Same thoughts....guess i'm not e only one who feels oversupply seems to be e problem.......problem is e price seems resing even though many is left on e shelf

[ExpatOilWorker]

Check out this site: http://www.prakard.com/

You can look through the history of newer building.

[Darrel]

......problem is e price seems resing even though many is left on e shelf

Standard Thai business logic: if sales are bad, raise the prices.

It works in a completely closed and feudal economy, but not in the real world.