Bkk Condo Glut

[ppam888]

Its been a very interesting discussion.

im very inexperienced in these ares so please be nice....

Lets say I have around 5-6 million baht to invest. And I want to maybe invest half of that in real estate and other half in stocks. I was looking at purchasing a condo as a long term investment and then renting it out. I have read a lot of the forums and this thread and there have been a lot of pessimistic views regarding condo investment in bangkok as a buy-to-let. Do you think its worth it? I believe I will probably get a better return in stocks but I if bought I condo I would gain exposure into something Im relatively interested in....

Keep in mind that I will be paying in lump sum and will prob be buying around jan 2012. Do you think its worth it?

If so what type of condos would be best? (e.g. old/new, 1 bed/2bed, centrally located, near bts etc.)

is condo investment in bangkok completely dead or not?

thanks

[ThreeProperty]

Depends where the condo is and what contacts you have, it's very saturated and I would not recommend it.

Their are far better investments to spend 6 million on.

Three Property

[khaan]

This flooding may have an effect on the BK condo glut - I see so many families flooded out and renting condos in the present crisis with no reason to hope that this may not all happen again next year.

Not only that if this becomes a regular occurrence I am wondering could this have a long-term impact on the structural integrity of the buildings themselves?

But yes it appears to me that Bangkok could become a city that you would want to be able to pack up and leave at short notice .

[FarangBuddha]

I bet if you gave Raimon Land a call, you could pick up a unit at their new The River (nobody thought they meant it would actually be IN a river) condo really cheap about now...probably some really cheap re-sales of existing purchase contracts as well

[london]

I bet if you gave Raimon Land a call, you could pick up a unit at their new The River (nobody thought they meant it would actually be IN a river) condo really cheap about now...probably some really cheap re-sales of existing purchase contracts as well

ONLY if you want part of the 51% Thai allocation.

[khaan]

I bet if you gave Raimon Land a call, you could pick up a unit at their new The River (nobody thought they meant it would actually be IN a river) condo really cheap about now...probably some really cheap re-sales of existing purchase contracts as well

ONLY if you want part of the 51% Thai allocation.

When I read this I wondered if we could ever see this kind of thing happening in Thailand?

Chinese Homeowners Damaged A Sales Office As Developer Cut Prices

http://www.alsosprac...cut-prices.html

Edited November 5, 2011 by khaan

[trogers]

I bet if you gave Raimon Land a call, you could pick up a unit at their new The River (nobody thought they meant it would actually be IN a river) condo really cheap about now...probably some really cheap re-sales of existing purchase contracts as well

ONLY if you want part of the 51% Thai allocation.

When I read this I wondered if we could ever see this kind of thing happening in Thailand?

Chinese Homeowners Damaged A Sales Office As Developer Cut Prices

http://www.alsosprac...cut-prices.html

Highly unlikely, not due to observed temperaments of Thais, but due to the high improbability of local developers cutting prices by 25%.

[khaan]

I bet if you gave Raimon Land a call, you could pick up a unit at their new The River (nobody thought they meant it would actually be IN a river) condo really cheap about now...probably some really cheap re-sales of existing purchase contracts as well

ONLY if you want part of the 51% Thai allocation.

When I read this I wondered if we could ever see this kind of thing happening in Thailand?

Chinese Homeowners Damaged A Sales Office As Developer Cut Prices

http://www.alsosprac...cut-prices.html

Highly unlikely, not due to observed temperaments of Thais, but due to the high improbability of local developers cutting prices by 25%.

Yes but you can never say impossible? Just look at a very sorry state of the global economy even without this flooding problem and yes they can refuse to cut their prices but they cannot live in Wonderland forever?

Over in the News threeds people are talking about the possibility this water will never recede and that this is the new normal.

And even if it does recede eventually people are not going to forget this episode for a long long time

because how do you know the same thing will not happen next year or the year after?

I think more and more people will realise that owning real estate in Bangkok was not such a wise thing after all

because it's a swamp.

Edited November 5, 2011 by khaan

[london]

The world is changing....things aren't the same as they were even 6 months ago.

The most salient statement in your entire post. when driving a car do you attach more importance

to what you see in your rearview mirror or what lies on the horizon in front of you?

I don't think this is the most salient.....but certainly the most obvious !

[london]

Yes but you can never say impossible? Just look at a very sorry state of the global economy even without this flooding problem and yes they can refuse to cut their prices but they cannot live in Wonderland forever?

Over in the News threeds people are talking about the possibility this water will never recede and that this is the new normal.

And even if it does recede eventually people are not going to forget this episode for a long long time

because how do you know the same thing will not happen next year or the year after?

I think more and more people will realise that owning real estate in Bangkok was not such a wise thing after all

because it's a swamp.

No, one can never say anything is "impossible".

The Chinese have a different mindset from the Thai's. Working in both places, you realise it quite quickly.

The Thai's have a Buddhist attitude and approach whereas the mainland Chinese are focused primarily on profit. Its money. Thats all that counts.

Forget these news threads "about the possibility this water will never recede and that this is the new normal." Same as so many bloggers.....a lot of information and opinion but little fact behind a lot of it.

The floods will recede and sure, they may return next year or the year after. However, I'd be prepared to bet that the levels experienced now will not be "the new normal". Money and expertise will come to the fore and new engineering will be used to stop it, not necessarily tomorrow, but over time, IF it occurs like this again. People do recover from adversity and they do tend to forget the extent of an adversity. Its part of the human condition.

Re your comment "I think more and more people will realise that owning real estate in Bangkok was not such a wise thing after all

because it's a swamp" I doubt if many people who own real estate in BKK are panicking. One adverse event doesn't make an investment unwise. Its part of the process. Oh, Bangkok is built on a flood plain, not a swamp.

If people are that fickle, then the Jakarta real estate market would be under water as Jakarta has a major ongoing flooding problem and is sinking. And yet, you try and buy a property cheaply in Jakarta....as cheaply for the same quality/location as BKK. It isn't going to happen. Oh, and from memory too, Venice has a regular flooding problem. Last time I looked, the prices there weren't in the bargain range.

[khaan]

Yes but you can never say impossible? Just look at a very sorry state of the global economy even without this flooding problem and yes they can refuse to cut their prices but they cannot live in Wonderland forever?

Over in the News threeds people are talking about the possibility this water will never recede and that this is the new normal.

And even if it does recede eventually people are not going to forget this episode for a long long time

because how do you know the same thing will not happen next year or the year after?

I think more and more people will realise that owning real estate in Bangkok was not such a wise thing after all

because it's a swamp.

No, one can never say anything is "impossible".

The Chinese have a different mindset from the Thai's. Working in both places, you realise it quite quickly.

The Thai's have a Buddhist attitude and approach whereas the mainland Chinese are focused primarily on profit. Its money. Thats all that counts.

Forget these news threads "about the possibility this water will never recede and that this is the new normal." Same as so many bloggers.....a lot of information and opinion but little fact behind a lot of it.

The floods will recede and sure, they may return next year or the year after. However, I'd be prepared to bet that the levels experienced now will not be "the new normal". Money and expertise will come to the fore and new engineering will be used to stop it, not necessarily tomorrow, but over time, IF it occurs like this again. People do recover from adversity and they do tend to forget the extent of an adversity. Its part of the human condition.

Re your comment "I think more and more people will realise that owning real estate in Bangkok was not such a wise thing after all

because it's a swamp" I doubt if many people who own real estate in BKK are panicking. One adverse event doesn't make an investment unwise. Its part of the process. Oh, Bangkok is built on a flood plain, not a swamp.

If people are that fickle, then the Jakarta real estate market would be under water as Jakarta has a major ongoing flooding problem and is sinking. And yet, you try and buy a property cheaply in Jakarta....as cheaply for the same quality/location as BKK. It isn't going to happen. Oh, and from memory too, Venice has a regular flooding problem. Last time I looked, the prices there weren't in the bargain range.

Yes but we haven't seen the outcome of the financial crisis yet and you just wait to see what surprises are lying for the global markets this Monday :whistling:it's to do with margin calls that means anything to you?

Edited November 5, 2011 by khaan

[zorro1]

Yes but you can never say impossible? Just look at a very sorry state of the global economy even without this flooding problem and yes they can refuse to cut their prices but they cannot live in Wonderland forever?

Over in the News threeds people are talking about the possibility this water will never recede and that this is the new normal.

And even if it does recede eventually people are not going to forget this episode for a long long time

because how do you know the same thing will not happen next year or the year after?

I think more and more people will realise that owning real estate in Bangkok was not such a wise thing after all

because it's a swamp.

No, one can never say anything is "impossible".

The Chinese have a different mindset from the Thai's. Working in both places, you realise it quite quickly.

The Thai's have a Buddhist attitude and approach whereas the mainland Chinese are focused primarily on profit. Its money. Thats all that counts.

Forget these news threads "about the possibility this water will never recede and that this is the new normal." Same as so many bloggers.....a lot of information and opinion but little fact behind a lot of it.

The floods will recede and sure, they may return next year or the year after. However, I'd be prepared to bet that the levels experienced now will not be "the new normal". Money and expertise will come to the fore and new engineering will be used to stop it, not necessarily tomorrow, but over time, IF it occurs like this again. People do recover from adversity and they do tend to forget the extent of an adversity. Its part of the human condition.

Re your comment "I think more and more people will realise that owning real estate in Bangkok was not such a wise thing after all

because it's a swamp" I doubt if many people who own real estate in BKK are panicking. One adverse event doesn't make an investment unwise. Its part of the process. Oh, Bangkok is built on a flood plain, not a swamp.

If people are that fickle, then the Jakarta real estate market would be under water as Jakarta has a major ongoing flooding problem and is sinking. And yet, you try and buy a property cheaply in Jakarta....as cheaply for the same quality/location as BKK. It isn't going to happen. Oh, and from memory too, Venice has a regular flooding problem. Last time I looked, the prices there weren't in the bargain range.

Yes but we haven't seen the outcome of the financial crisis yet and you just wait to see what surprises are lying for the global markets this Monday :whistling:it's to do with margin calls that means anything to you?

You inadvertently nailed it. The thai property market was unaffected in the last market crash whilst the west went into free fall. The same people were posting what you just posted predicting a wipe out for Bangkok....never happened and for very obvious reasons.

Now we have the same crowd predicting a catastrophic once in 50 years flood will be the demise of Thailands property market

You can look back as far as you like on TV and you wont find a positive property thread, yet the prices on new condos keep rising year after year. One of the reasons the anti property posters far out number everyone else is simply due to money issues, lets face it, the majority of westerners have arrived here as a busted <deleted> (failed marriage, business etcetc) and continue to live on a shoestring ,Jaded and are anti everything Thai except the girlies of course. Rarely do wildly successful people pull up stumps and move to Asia full time unless retired.

There will always be down ramping in the R/E sector but prices keep rising, Thats the market for you and as they say until proven otherwise the market is always right

[khaan]

Re your comment "I think more and more people will realise that owning real estate in Bangkok was not such a wise thing after all

because it's a swamp" I doubt if many people who own real estate in BKK are panicking. One adverse event doesn't make an investment unwise. Its part of the process. Oh, Bangkok is built on a flood plain, not a swamp.

If people are that fickle, then the Jakarta real estate market would be under water as Jakarta has a major ongoing flooding problem and is sinking. And yet, you try and buy a property cheaply in Jakarta....as cheaply for the same quality/location as BKK. It isn't going to happen. Oh, and from memory too, Venice has a regular flooding problem. Last time I looked, the prices there weren't in the bargain range.

I don't think it is correct for you to compare Bangkok with Jakarta because it sounds like Jakarta is miles ahead of Bangkok in dealing with this problem?

I raised this question in one of the flooding threads in the news section and one poster responded with these comments

" Yes, Jakarta DID have the same problem every year. They finally decided something needed to be one. They brought in the experts, both Indonesian and foreign, and eventually built a water management system both above and below ground. One of the things they did was dig a massive tunnel that, in normal times handles traffic, but during monsoon floods, traffic is rerouted and the tunnel serves as a giant drainage system that all the other systems drain into. Yes, Thailand/BKK could very well benefit from something such as this, but only if it can be done correctly, which means bringing in REAL experts, and doing away with all the graft and corruption, and we all know that's not going to happen. But as I said in my op, experts, both Thai and foreign, have been telling and warning the governments for the past 50+ years about what could/would happen, but no one bothered to listen. Now they're paying the price for it."

[khaan]

Yes but you can never say impossible? Just look at a very sorry state of the global economy even without this flooding problem and yes they can refuse to cut their prices but they cannot live in Wonderland forever?

Over in the News threeds people are talking about the possibility this water will never recede and that this is the new normal.

And even if it does recede eventually people are not going to forget this episode for a long long time

because how do you know the same thing will not happen next year or the year after?

I think more and more people will realise that owning real estate in Bangkok was not such a wise thing after all

because it's a swamp.

No, one can never say anything is "impossible".

The Chinese have a different mindset from the Thai's. Working in both places, you realise it quite quickly.

The Thai's have a Buddhist attitude and approach whereas the mainland Chinese are focused primarily on profit. Its money. Thats all that counts.

Forget these news threads "about the possibility this water will never recede and that this is the new normal." Same as so many bloggers.....a lot of information and opinion but little fact behind a lot of it.

The floods will recede and sure, they may return next year or the year after. However, I'd be prepared to bet that the levels experienced now will not be "the new normal". Money and expertise will come to the fore and new engineering will be used to stop it, not necessarily tomorrow, but over time, IF it occurs like this again. People do recover from adversity and they do tend to forget the extent of an adversity. Its part of the human condition.

Re your comment "I think more and more people will realise that owning real estate in Bangkok was not such a wise thing after all

because it's a swamp" I doubt if many people who own real estate in BKK are panicking. One adverse event doesn't make an investment unwise. Its part of the process. Oh, Bangkok is built on a flood plain, not a swamp.

If people are that fickle, then the Jakarta real estate market would be under water as Jakarta has a major ongoing flooding problem and is sinking. And yet, you try and buy a property cheaply in Jakarta....as cheaply for the same quality/location as BKK. It isn't going to happen. Oh, and from memory too, Venice has a regular flooding problem. Last time I looked, the prices there weren't in the bargain range.

Yes but we haven't seen the outcome of the financial crisis yet and you just wait to see what surprises are lying for the global markets this Monday :whistling:it's to do with margin calls that means anything to you?

You inadvertently nailed it. The thai property market was unaffected in the last market crash whilst the west went into free fall. The same people were posting what you just posted predicting a wipe out for Bangkok....never happened and for very obvious reasons.

Now we have the same crowd predicting a catastrophic once in 50 years flood will be the demise of Thailands property market

You can look back as far as you like on TV and you wont find a positive property thread, yet the prices on new condos keep rising year after year. One of the reasons the anti property posters far out number everyone else is simply due to money issues, lets face it, the majority of westerners have arrived here as a busted <deleted> (failed marriage, business etcetc) and continue to live on a shoestring ,Jaded and are anti everything Thai except the girlies of course. Rarely do wildly successful people pull up stumps and move to Asia full time unless retired.

There will always be down ramping in the R/E sector but prices keep rising, Thats the market for you and as they say until proven otherwise the market is always right

Do you have any evidence to support your theory that this will not happen again for another 50 years and can you tell me where I can buy

the crystal ball you use?

[khaan]

. Oh, Bangkok is built on a flood plain, not a swamp.

You say that but the Economist magazine says distinctly Bangkok is built over a swamp?

Actually this article unbelievably is from 2000 and yet it could have been written yesterday?

Bangkok gets that sinking feeling

Apr 27th 2000

" ONCE known as the Venice of the East for its multitude of canals, Bangkok may soon resemble another fabled city: Atlantis. According to Thailand’s Department of Mineral Resources, Bangkok is sinking at the rate of up to five centimetres (two inches) a year, and the entire city may be below sea level by 2050.

For some 200 years, Bangkok, built over a swamp, has weathered annual floods. Every monsoon season, heavy rains slow traffic to a crawl and flood basements in some areas of the city. But the factories and housing estates that sprang up during Thailand's economic boom took much of Bangkok's ground-water, and as water has flowed out of the ground, the soil has sunk in. The government estimates that about 2.5m cubic metres (660m American gallons) of ground-water a day is pumped up in Bangkok, twice as much as can safely be removed."

http://www.economist.com/node/304819

Edited November 5, 2011 by khaan

[khaan]

. Oh, Bangkok is built on a flood plain, not a swamp.

You say that but the Economist magazine says distinctly Bangkok is built over a swamp?

Actually this article unbelievably is from 2000 and yet it could have been written yesterday?

Bangkok gets that sinking feeling

Apr 27th 2000

" ONCE known as the Venice of the East for its multitude of canals, Bangkok may soon resemble another fabled city: Atlantis. According to Thailand’s Department of Mineral Resources, Bangkok is sinking at the rate of up to five centimetres (two inches) a year, and the entire city may be below sea level by 2050.

For some 200 years, Bangkok, built over a swamp, has weathered annual floods. Every monsoon season, heavy rains slow traffic to a crawl and flood basements in some areas of the city. But the factories and housing estates that sprang up during Thailand's economic boom took much of Bangkok's ground-water, and as water has flowed out of the ground, the soil has sunk in. The government estimates that about 2.5m cubic metres (660m American gallons) of ground-water a day is pumped up in Bangkok, twice as much as can safely be removed."

http://www.economist.com/node/304819

Floods show what lies ahead for sinking Bangkok

by Amelie Bottollier-Depois

BANGKOK, November 7, 2011 (AFP) - The Thai capital, built on swampland, is slowly sinking and the floods currently besieging Bangkok could be merely a foretaste of a grim future as climate change makes its impact felt, experts say.

The low-lying metropolis lies just 30 kilometres (18 miles) north of the Gulf of Thailand, where various experts forecast sea level will rise by 19 to 29 centimetres (7 to 11 inches) by 2050 as a result of global warming.

Water levels would also increase in Bangkok's main Chao Phraya river, which already overflows regularly.

[travelmann]

Yes but you can never say impossible? Just look at a very sorry state of the global economy even without this flooding problem and yes they can refuse to cut their prices but they cannot live in Wonderland forever?

Over in the News threeds people are talking about the possibility this water will never recede and that this is the new normal.

And even if it does recede eventually people are not going to forget this episode for a long long time

because how do you know the same thing will not happen next year or the year after?

I think more and more people will realise that owning real estate in Bangkok was not such a wise thing after all

because it's a swamp.

No, one can never say anything is "impossible".

The Chinese have a different mindset from the Thai's. Working in both places, you realise it quite quickly.

The Thai's have a Buddhist attitude and approach whereas the mainland Chinese are focused primarily on profit. Its money. Thats all that counts.

Forget these news threads "about the possibility this water will never recede and that this is the new normal." Same as so many bloggers.....a lot of information and opinion but little fact behind a lot of it.

The floods will recede and sure, they may return next year or the year after. However, I'd be prepared to bet that the levels experienced now will not be "the new normal". Money and expertise will come to the fore and new engineering will be used to stop it, not necessarily tomorrow, but over time, IF it occurs like this again. People do recover from adversity and they do tend to forget the extent of an adversity. Its part of the human condition.

Re your comment "I think more and more people will realise that owning real estate in Bangkok was not such a wise thing after all

because it's a swamp" I doubt if many people who own real estate in BKK are panicking. One adverse event doesn't make an investment unwise. Its part of the process. Oh, Bangkok is built on a flood plain, not a swamp.

If people are that fickle, then the Jakarta real estate market would be under water as Jakarta has a major ongoing flooding problem and is sinking. And yet, you try and buy a property cheaply in Jakarta....as cheaply for the same quality/location as BKK. It isn't going to happen. Oh, and from memory too, Venice has a regular flooding problem. Last time I looked, the prices there weren't in the bargain range.

And lets not forget all the nice big fat real estate in earthquake zones all round the world, dont see el cheapo prices there.

[travelmann]

. Oh, Bangkok is built on a flood plain, not a swamp.

You say that but the Economist magazine says distinctly Bangkok is built over a swamp?

Actually this article unbelievably is from 2000 and yet it could have been written yesterday?

Bangkok gets that sinking feeling

Apr 27th 2000

" ONCE known as the Venice of the East for its multitude of canals, Bangkok may soon resemble another fabled city: Atlantis. According to Thailand's Department of Mineral Resources, Bangkok is sinking at the rate of up to five centimetres (two inches) a year, and the entire city may be below sea level by 2050.

For some 200 years, Bangkok, built over a swamp, has weathered annual floods. Every monsoon season, heavy rains slow traffic to a crawl and flood basements in some areas of the city. But the factories and housing estates that sprang up during Thailand's economic boom took much of Bangkok's ground-water, and as water has flowed out of the ground, the soil has sunk in. The government estimates that about 2.5m cubic metres (660m American gallons) of ground-water a day is pumped up in Bangkok, twice as much as can safely be removed."

http://www.economist.com/node/304819

Floods show what lies ahead for sinking Bangkok

by Amelie Bottollier-Depois

BANGKOK, November 7, 2011 (AFP) - The Thai capital, built on swampland, is slowly sinking and the floods currently besieging Bangkok could be merely a foretaste of a grim future as climate change makes its impact felt, experts say.

The low-lying metropolis lies just 30 kilometres (18 miles) north of the Gulf of Thailand, where various experts forecast sea level will rise by 19 to 29 centimetres (7 to 11 inches) by 2050 as a result of global warming.

Water levels would also increase in Bangkok's main Chao Phraya river, which already overflows regularly.

http://www.thaivisa....-inner-bangkok/

Ive already edited that clipping for you if you go and look and taken out the dross. http://www.thaivisa.com/forum/topic/510642-floodwater-spreading-into-inner-bangkok/page__st__100

[steveromagnino]

Actually, parts of Bangkok were historically swamp and other parts weren't. Airport the new one is most definitely swamp, and the decision on how it was built in that part of the city is partly why Minburi and others on the east side of the city are underwater now; that's how the water used to flow.

Much of the inner city is reasonably solid sand. Water table is high, but that's not surprising given the geography. Using ground water is declining substantially now compared to 10 years ago.

Replacing the klongs and canals with roads works as long as you have the means to shift the water away quickly. Bangkok has that, which is why flash floods occur ocassionally but not with great regularity and the degree is usually reasonable and certainly on par with other cities with similar rainfall stats.

What Bangkok cannot cope with is the vast amount of water flowing south, partly caused by lousy management of the watershed since July (particularly in August/Sept) and partly caused by long term lack of planning to divert the water in a 1 in 50 year volume.

A sinking city doesn't help, but this would be a non issue with a few LA style bypasses for flooding and some high pressure pumps similar to what is used now for areas like Dindaeng...but going all the way to the sea - current ones dump back into the river south of Bangkok (if we care enough to allow Samut Prakarn to stay dry, not part of BMA though).

Incidentally, the Economist is not so strong for facts regarding countries or people in the corners of the world (reliably 'average' when writing on countries like the Pacific Islands, NZ, Thailand, etc - par for the course when you have stretched editorial staff covering multiple countries; I think the Thailand correspondent was covering 4 countries at one point a few years back).

As with most of their political coverage of Thailand, it's not the stuff of substance that we get served weekly regarding USA, UK, world finance or even some very novel and interesting topics. Compulsory reading over breakfast, sure... but with a little salt. For the eggs, they don't give you high blood pressure by themselves you know!

Now, regarding the so called GLUT. I cannot see this clear cut difference between Thai Chinese and Thais nearly as easily as some posters. The line is far less clear than other countries with widespread Chinese migration, with a much closer sharing of values; most of the Thai Chinese I know and work with, less than 1/2 would be full Chinese, most are mixed. I know plenty of money hungry pure Thais, and plenty of highly religious Chinese Thais.

The glut of condos is not supported by statistics or facts of the market (also due to non transparency); and even if there is over supply the latest promotions by the government will continue to distort the new /2nd hand market differential which is accentuated by access to finance. Access to transportation makes some sizeable differences between 2 buildings 100m apart now; the right buildings and right locations will always sell. And are selling now.

What I DO think we may see is a continuing drop in the popularity of further out estates, and a continuing shift towards the inner city; not just from flooding but also from transportation. Also...the government's market distorting crazy 1st home scheme is aimed at creating demand for mid priced condos mostly, and the benefits accrue to tax payers; many of whom work in the inner city. While the also market distorting car scheme might have previously helped the estates in suburban Bangkok, that one is mostly dead in the water literally, as the number of cars available to buy that are part of the scheme designed to basically enrich Honda/Toyota and their suppliers just slumped severely.

When you have the leaders (Prueksa, L&H, Q House, LPN) and even the me-toos of the property sector starting to do condos (SC Asset for instance) you know this is a shift in the WAY in which Thai people will live. Fact is, the average 26-30 year old looking to move out of the family house no longer thinks they want a house; more than 50% expect to live in a condo so they don't have to spend their time in a car. That's a huge shift from 2004, when condos were relatively new.

There are substantial differences between condos built now and condos built even 8 years ago at the top end of the market; which is why some have appreciated so much, while others drop. Costs to build (supply side) keep climbing. So you have the strategy at the bottom end (LPN for instance) getting more and more efficient at delivering and keeping prices relatively steady, and at the top end (the true top end, St Regis, Sukhothai, Ritz-Carlton) delivering condos that are worthy of the world's rich...perhaps beyond the reach of the average millionaire, but for which there is a substantial market of people who previously would live in their own housing estate - I believe St Regis and Ritz-Carlton are both mostly Thais who have bought; Sukhothai 50 50.

[khaan]

Actually, parts of Bangkok were historically swamp and other parts weren't. Airport the new one is most definitely swamp, and the decision on how it was built in that part of the city is partly why Minburi and others on the east side of the city are underwater now; that's how the water used to flow.

Much of the inner city is reasonably solid sand. Water table is high, but that's not surprising given the geography. Using ground water is declining substantially now compared to 10 years ago.

Replacing the klongs and canals with roads works as long as you have the means to shift the water away quickly. Bangkok has that, which is why flash floods occur ocassionally but not with great regularity and the degree is usually reasonable and certainly on par with other cities with similar rainfall stats.

What Bangkok cannot cope with is the vast amount of water flowing south, partly caused by lousy management of the watershed since July (particularly in August/Sept) and partly caused by long term lack of planning to divert the water in a 1 in 50 year volume.

A sinking city doesn't help, but this would be a non issue with a few LA style bypasses for flooding and some high pressure pumps similar to what is used now for areas like Dindaeng...but going all the way to the sea - current ones dump back into the river south of Bangkok (if we care enough to allow Samut Prakarn to stay dry, not part of BMA though).

Incidentally, the Economist is not so strong for facts regarding countries or people in the corners of the world (reliably 'average' when writing on countries like the Pacific Islands, NZ, Thailand, etc - par for the course when you have stretched editorial staff covering multiple countries; I think the Thailand correspondent was covering 4 countries at one point a few years back).

As with most of their political coverage of Thailand, it's not the stuff of substance that we get served weekly regarding USA, UK, world finance or even some very novel and interesting topics. Compulsory reading over breakfast, sure... but with a little salt. For the eggs, they don't give you high blood pressure by themselves you know!

Now, regarding the so called GLUT. I cannot see this clear cut difference between Thai Chinese and Thais nearly as easily as some posters. The line is far less clear than other countries with widespread Chinese migration, with a much closer sharing of values; most of the Thai Chinese I know and work with, less than 1/2 would be full Chinese, most are mixed. I know plenty of money hungry pure Thais, and plenty of highly religious Chinese Thais.

The glut of condos is not supported by statistics or facts of the market (also due to non transparency); and even if there is over supply the latest promotions by the government will continue to distort the new /2nd hand market differential which is accentuated by access to finance. Access to transportation makes some sizeable differences between 2 buildings 100m apart now; the right buildings and right locations will always sell. And are selling now.

What I DO think we may see is a continuing drop in the popularity of further out estates, and a continuing shift towards the inner city; not just from flooding but also from transportation. Also...the government's market distorting crazy 1st home scheme is aimed at creating demand for mid priced condos mostly, and the benefits accrue to tax payers; many of whom work in the inner city. While the also market distorting car scheme might have previously helped the estates in suburban Bangkok, that one is mostly dead in the water literally, as the number of cars available to buy that are part of the scheme designed to basically enrich Honda/Toyota and their suppliers just slumped severely.

When you have the leaders (Prueksa, L&H, Q House, LPN) and even the me-toos of the property sector starting to do condos (SC Asset for instance) you know this is a shift in the WAY in which Thai people will live. Fact is, the average 26-30 year old looking to move out of the family house no longer thinks they want a house; more than 50% expect to live in a condo so they don't have to spend their time in a car. That's a huge shift from 2004, when condos were relatively new.

There are substantial differences between condos built now and condos built even 8 years ago at the top end of the market; which is why some have appreciated so much, while others drop. Costs to build (supply side) keep climbing. So you have the strategy at the bottom end (LPN for instance) getting more and more efficient at delivering and keeping prices relatively steady, and at the top end (the true top end, St Regis, Sukhothai, Ritz-Carlton) delivering condos that are worthy of the world's rich...perhaps beyond the reach of the average millionaire, but for which there is a substantial market of people who previously would live in their own housing estate - I believe St Regis and Ritz-Carlton are both mostly Thais who have bought; Sukhothai 50 50.

Steveromagnino even if you are right about what you've written ( and there is no guarantee that you are even remotely so ) then it still comes down to the fact who in their right mind would want to buy real estate with the real risk that you have to write off the investment over 50 years?

This means you need to value the property as you would when it is leasehold and nothing more which makes some of Bangkok's condominium developments very expensive indeed.

International Experts: Bangkok to be Submerged under Water in 50 Years

[farang000999]

this is not rocket science. when you set interest rates super low nobody wants to have their money sitting in the bank. why? because they know oil is not going to cost only 1% more a year from now. why keep ur money earning 1% when you can buy a condo and earn 3-5% from a renter and enjoy the price appreciation? It will probably double in value in the next 5-6 years right?

there are two situations to the global crisis, debt deflation which will cause asset deflation or monetary inflation which will wipe out debts and send the value of paper money downward and all assets upwards.

no need to get blue in the face debating it, we will surely get the solution soon enough.

the one hilarious thing though is this rumor that all real estate in Thailand is purchased with cash in Thailand.

[khaan]

this is not rocket science. when you set interest rates super low nobody wants to have their money sitting in the bank. why? because they know oil is not going to cost only 1% more a year from now. why keep ur money earning 1% when you can buy a condo and earn 3-5% from a renter and enjoy the price appreciation? It will probably double in value in the next 5-6 years right?

there are two situations to the global crisis, debt deflation which will cause asset deflation or monetary inflation which will wipe out debts and send the value of paper money downward and all assets upwards.

no need to get blue in the face debating it, we will surely get the solution soon enough.

the one hilarious thing though is this rumor that all real estate in Thailand is purchased with cash in Thailand.

Good luck with that one going forward

[steveromagnino]

Steveromagnino even if you are right about what you've written ( and there is no guarantee that you are even remotely so ) then it still comes down to the fact who in their right mind would want to buy real estate with the real risk that you have to write off the investment over 50 years?

I believe that as with this year, correct upcountry water management will mean Bangkok is unlikely to be affected long term in a major way by climate change or sea level change; certainly not rainfall. As neither of us are fortune tellers, we will have to see whether that transpires to be true or not.

There are very real risks in many places; earthquakes (LA, Tokyo, Christchurch, etc), tsunami, fires, floods, nuclear radiation, etc. People keep buying in those places (often with insurance) and so the question becomes is there inherent demand to live in Bangkok or not.

I would answer...based on the market demand for housing and real absorption rates....yes.

Certain areas in the medium term are certainly likely to depreciate as the market factors in flood risk. Other areas as a direct result may benefit.

We will just have to see how it all turns out.

[khaan]

There are very real risks in many places; earthquakes (LA, Tokyo, Christchurch, etc), tsunami, fires, floods, nuclear radiation, etc. People keep buying in those places (often with insurance) and so the question becomes is there inherent demand to live in Bangkok or not.

We will just have to see how it all turns out.

now the " malaise " has even hit Hong Kong

HK home sales fall over 50% in October

http://www.shanghaidaily.com/article/?id=486448&type=Business

[zorro1]

lets see now... what should I buy for me and my family.... A safe high dry condo ....or????

enough said

[janverbeem]

lets see now... what should I buy for me and my family.... A safe high dry condo ....or????

enough said

What is the purpose of having a safe high dry condo if you have to swim to the local 7/11 anyway?

[khaan]

lets see now... what should I buy for me and my family.... A safe high dry condo ....or????

enough said

What is the purpose of having a safe high dry condo if you have to swim to the local 7/11 anyway?

it is quite evident who all the condo owners are in this thread

They are too embarrassed to admit that the tables have turned on them because Bangkok has now become a place

where if you want to live there you need complete flexibility and to be able to move if the need arises at the drop of a hat.

Condo ownership does not give you that flexibility

better to rent your accommodation in Bangkok and invest your money in one of the other

many equally good and dry ( and not sinking ) markets around the world.

Edited November 10, 2011 by khaan

[zorro1]

lets see now... what should I buy for me and my family.... A safe high dry condo ....or????

enough said

What is the purpose of having a safe high dry condo if you have to swim to the local 7/11 anyway?

it is quite evident who all the condo owners are in this thread

They are too embarrassed to admit that the tables have turned on them because Bangkok has now become a place

where if you want to live there you need complete flexibility and to be able to move if the need arises at the drop of a hat.

Condo ownership does not give you that flexibility

better to rent your accommodation in Bangkok and invest your money in one of the other

many equally good and dry ( and not sinking ) markets around the world.

http://www.thaivisa....50#entry4834449

Floods Likely To Renew Interest In Condos: Thailand

Makes perfect sense to me.

.

Good luck with your "international" investment portfolio, but you certainly dont post like a content millionaire playboy so I somehow doubt it. Packing up and leaving at the drop of a hat is a euphemism for... sh#t , Im out of money, time to go home LOL

You know its true

Edited November 10, 2011 by zorro1

[khaan]

lets see now... what should I buy for me and my family.... A safe high dry condo ....or????

enough said

What is the purpose of having a safe high dry condo if you have to swim to the local 7/11 anyway?

it is quite evident who all the condo owners are in this thread

They are too embarrassed to admit that the tables have turned on them because Bangkok has now become a place

where if you want to live there you need complete flexibility and to be able to move if the need arises at the drop of a hat.

Condo ownership does not give you that flexibility

better to rent your accommodation in Bangkok and invest your money in one of the other

many equally good and dry ( and not sinking ) markets around the world.

http://www.thaivisa....50#entry4834449

Floods Likely To Renew Interest In Condos: Thailand

Makes perfect sense to me.

.

Good luck with your "international" investment portfolio, but you certainly dont post like a content millionaire playboy so I somehow doubt it. Packing up and leaving at the drop of a hat is a euphemism for... sh#t , Im out of money, time to go home LOL

You know its true

Running out of money has nothing to do with it.

Packing up and leaving at the drop of a hat is because the water would have arrived yet again

and don't forget the La Nina conditions can last up to 2 years so you cannot possibly

tell that you will not experience the same thing again in the next monsoon season.

If you can't recognise the potential folly of investing in real estate where experts

are now predicting that within 50 years the city will be underwater then I can only imagine you are a

condominium owner yourself and you must feel uncertain? I can understand that

Unless Bangkok condominium prices were now dirt cheap ( which they are not ) I'm sure there will be many people

who will reconsider their alternatives.

Edited November 10, 2011 by khaan

[bkkjames]

with the home ownership laws as they are combined with exceedingly high prices vs quality in Bangkok area I don't honestly care too much.

Condos are a double edged sword IMO. Again workmanship and materials that last for a year or two before the owners need to pay to replace / fix stuff, condo committees set up and driven by absentee money hungry owners who cut everything that was once promised on the glossy brochure.

Of course there are some exceptions but all these newish condos with fancy names up and down sukhumvit and other areas priced at 120k+ a sqm are already looking old and tired.

The older condo buildings (again generally) that I have rented over the years seem to fair better, more owner occupiers, less crappy cheap facades and tiling than the newer ones being thrown up and branded / priced as Grade A but really are barely Grade B.

However people keep snapping them up when launched. I rent one now that would cost me 10 million to buy for 88 sqm on the river. Nice development - 2 yrs old, room is nice but has a few issues but again 333,000 USD for it instead of renting it for 21k a month like a do. No thanks.

Edited November 10, 2011 by bkkjames