Property Pricing Rising ?

[jonik]

I've been watching prices for land/property in the south area like samoui and phuket ,and it seems like there is a lot of building going on and the prices is rising.

A good landslot is about 6-8 mill bath now and when i first started looking at these propertys the price was about 2-4 mill bath.Is there a change going on or what?

I've asked in this forum before but nobody seemed recognize this.................

So i've been looking at beachland in Cambodia to but the prices are pretty high there also.......about 2,5 - 3000 bth pr sqm land.

Am i too late for some shopping ?

[Heng]

If you're not already in, then yes you've probably missed the boat in a lot of the more popular markets. That said, unless you're a property developer or in it just for the business aspect, it's not a big deal to miss the boat. Yes, you pay more (say if you're buying a place to live or retire), but you're probably less likely to get burned as well.

[jonik]

eh........i don't think you got my question quite right.

I am asking if there has been some drastic changes in the pricing for properties in los, i seem to remember that the prices were pretty much lower 1 year ago than right now.

I know you still can get some good spots but at a much higher price.

Or is this a scam to make people think that this is the value of these propertys.

It's been done elsewhere, so is the same thing happening in thailand ?

Look at the landslots in Spain the prices has gone skyhigh cause some dealers made it look like this was the price to pay.And now it is........

In Norway the prices went from zero to impossible in just 2-3 years. This due to lack of condoes and houses for sale.

[johnnyk]

Property is worth precisely what someone will pay for it in real money.

What someone asks and what they get are different things.

Find out, if you can, the actual price paid for a given piece of land, that's the only umber that really matters.

But, yes, prices have risen.

Cheap interest rates worldwide are fueling the property boom.

[jrincon17]

Property is worth precisely what someone will pay for it in real money.

What someone asks and what they get are different things.

Find out, if you can, the actual price paid for a given piece of land, that's the only umber that really matters.

But, yes, prices have risen.

Cheap interest rates worldwide are fueling the property boom.

<{POST_SNAPBACK}>

also with the lower rates makes this an issue , but not usually in thaioland

[baht&sold]

Property is worth precisely what someone will pay for it in real money.

<{POST_SNAPBACK}>

That's the reality.

I'm no expert but there's at least a couple basic camps who might be forgiven for having much different perspectives on the Expat property market in Thailand (excluding commercial properties & the Thai domestic market)

-There's the offshore Expat vacation/homebuyer/retiree/investor who previously bought or was looking at say, Mallorca Spain (or Cancun Mexico etc etc) and is now looking at Thailand comparitively.

-Then there's the local Expat who's lived in Thailand a while now, been thinking of buying and watching prices for some time and who's point of view may come from comparing prices in Thailand to well, Thailand.

To each camp, their points of view are formed from separate realities, yet to both are real. Meanwhile, prices have risen across the board.

Who's right, what's real? I think Johnnyk nailed it with his answer above

[Heng]

Check out the revenue boards that are publicly displayed at most land offices. Land, houses, buildings are being bought and sold left and right... and I don't think it's just a show to get you to pay 25% more.

[SamuiRes]

I've been watching prices for land/property in the south area like samoui and phuket ,and it seems like there is a lot of building going on and the prices is rising.

A good landslot is about 6-8 mill bath now and when i first started looking at these propertys the price was about 2-4 mill bath.Is there a change going on or what?

I've asked in this forum before but nobody seemed recognize this.................

So i've been looking at beachland in Cambodia to but the prices are pretty high there also.......about 2,5 - 3000 bth pr sqm land.

Am i too late for some shopping ?

<{POST_SNAPBACK}>

I can only speak for Samui. land prices here have risen dramatically over the last couple of years. Four years ago one rai on the beach in Talig Ngam sold for Baht 2m. Today that would sell for Baht 8m or more easily.

We are finding it harder and harder to put a value on any particular piece of land. There is no consistency in the market any more. One of the factors has been the buyer with significant funds who sees a plot of land he likes (particularly true of sea view close to the sea) and will pay what ever it takes to get that land. That is why we have seen some hillside/seaview land in the NE of the island selling for upwards of Baht 13m/rai. (Elsewhere 2.5 - 4.5 would be the norm) The philosophy seems to be, this is the location I want, I have the money, I will spend say Baht 15m on the land, another Baht 15m on the house, and have something worth maybe Baht 40m. In that sense the economics work, but only for very special land. There is a knock on effect of course in that everyone now thinks they can sell for Baht 15m/rai in that area, which is not necessarily true.

The same philosophy seem to apply to beach land which is becoming scarcer and scarcer. However, from a personal point of view I really do not understand it as the limitations on what you can build on the beach restrict the ability to build a house of any size. I am not saying the restrictions are wrong, I applaud them, but strict size limitations, set backs, height restrictions, density restrictions - to me anway make the prices being paid for beach land unrealistic - but you cannot argue with the market - if someone will pay the price that is what it is worth.

Arguing with myself here a bit - I slightly disagree with that though in as much I believe the true value is not what the highest bidder pays, but the what the second highest bidder would have paid.

To answer the question - have you missed the boat? Well as my first boss said to me "You never miss the boat - there is a boat leaving every day - you just need to be on the right one!" Research the market, do not rush into anything, carry out good due diligence but be prepared to move quickly when a good opportunity presents itself because if you do not, someone else will.

[OldAsiaHand]

The prior post seems to me to contain quite a lot of sensiblle advice. I would add only one observation for emphasis....

A major problem with the property markets in Thailand is that, on the whole, they don't exist. Unlike in Europe or the US, the concept of 'a market' just isn't useful in determining value or pricing since there is so little readily accessible and accurate data available.

The previous poster's experience with the 'knock-on effect' is a perfect example. Even in a much bigger market, say condos in Bangkok, it works exactly the same way. Some developer launches a new building priced at 20% above what is generally accepted to be the prevailing price and suddenly everybody says that existing condos have 'gone up' by 20%. Of course, no one sells at the new price (and possibly nobody was selling at the old price either), but it doesn't matter. Prices are now 'up' 20%. Welcome to Thailand.

[h5n1]

Don't worry - you can always rent what these losers bought and can't sell. Prices are rising everywhere, nothing is selling for it's asking prices except to those numbskulls off the boat.

Give the draconain nature (laws) of owning anything here - you're doing fine mate.

Why buy someones used condo when the same new one is going up next door?

Old Asia Hand - spot on. Check the Pattaya Trader for all the Property that is NOT selling. NOt to mention all the 'expert' real estate mugs hyping themselves as 'professional' (last time I checked a Professional had a terminal degree and worked in a profession!...No shortage of mugs that are willing to help you separate yourself from your money.

Edited December 30, 2005 by h5n1

[chucky66]

I still dont get why anyone would want to invest in property or land in Thailand if repatriating money (getting their money out of Thailand and back to their homeland) is so difficult. This limiting factor will therefore always restrict the profitability of investments and until I get an answer Im not putting any of my money into Thailand until someone tells me a clear and easy way of how to get it back out again should I need to.

[jonik]

The prices are adjusted by the seller in most cases a propertysales company, these are the ones who set the price and ofcourse they want the highest price. If all the best spots in los are being sold you would have an unlimited posibility to set the prices as high as you'd want,because these are excelent located.

[SamuiRes]

I still dont get why anyone would want to invest in property or land in Thailand if repatriating money (getting their money out of Thailand and back to their homeland) is so difficult. This limiting factor will therefore always restrict the profitability of investments and until I get an answer Im not putting any of my money into Thailand until someone tells me a clear and easy way of how to get it back out again should I need to.

<{POST_SNAPBACK}>

Provided you brought the funds into Thailand correctly, ie throught the banking system and obtained a Tor Dor Sam certificate from the bank, you can repatriate those funds without any difficulty. The funds must come in in foreign currency and be converted to Thai Baht here and you must state that the funds are for investment in Thailand. As and when you wish to send the funds back you simply go to the bank with the Tor Dor Sam and make the transfer. I have done this for clients on more than one occassion and know it works.

Now, assuming your investment has been wise and you have actually made a profit, you would expect to pay tax on that profit and if you provide the Tax Certificate from the Revenue Department you can freely repatriate those funds as well.

[chucky66]

As a foreigner I was advised that you cannot get one of these repatriation certificates if you plan to buy land or a house using a Thai company and that only when you buy certain condos (local govt approved) can you get this certficate?

This is one of the main problems I have with investingin Thailand is that these rules/laws for foreigners are not made clear. When it is my hard earned money that Im investing this lack of clarity makes things a lot more risky.

[nev]

why would you want to buy in thailand when the rent is so cheap and if not happy where you are just move on.

have seen some 1 3 million baht condos returning just 8000 baht a month and thats if they can let them.

better of having money invested off shore and live off the income.

[jonik]

An value increase of 400 percent in 4 years is a pretty good investment if you ask me. Don't know where you live but you better have some solid off shore investment to manage that.....

[nev]

please show me where in thailand you can get 400% return on anything.

its ok someone telling you your property is worth this now,just try selling.

i come from australia.

i still think renting is the best option.

[SamuiRes]

As a foreigner I was advised that you cannot get one of these repatriation certificates if you plan to buy land or a house using a Thai company and that only when you buy certain condos (local govt approved) can you get this certficate?

This is one of the main problems I have with investingin Thailand is that these rules/laws for foreigners are not made clear. When it is my hard earned money that Im investing this lack of clarity makes things a lot more risky.

<{POST_SNAPBACK}>

All I can say from practical experience is that I have not had a problem sending money out with the TD3 certificate on behalf of clients. Nor have we ever had a problem getting the certificates. Suggest you ask whoever gave you this advice what experience they have had in this respect. Rumour is one thing. Fact is another and my comments are based on fact and actual application.

[Dragonman]

As a foreigner I was advised that you cannot get one of these repatriation certificates if you plan to buy land or a house using a Thai company and that only when you buy certain condos (local govt approved) can you get this certficate?

This is one of the main problems I have with investingin Thailand is that these rules/laws for foreigners are not made clear. When it is my hard earned money that Im investing this lack of clarity makes things a lot more risky.

<{POST_SNAPBACK}>

All I can say from practical experience is that I have not had a problem sending money out with the TD3 certificate on behalf of clients. Nor have we ever had a problem getting the certificates. Suggest you ask whoever gave you this advice what experience they have had in this respect. Rumour is one thing. Fact is another and my comments are based on fact and actual application.

Agree with SamuiRes. It is much easier now than in past times to repatriate money for whatever reason. As long as you have a transparent line of events ie send money, buy home, sell home, pay taxes, etc there is no problem, other than from some bank officials who don't know what they're talking about If you want clarification contact BoT.

[appleman_thai]

Does anyone know the rate of tax that would apply to the "profit" amount on the sale of a house?

Also, does anyone know the rate of tax that would apply for rental income ?

thanks in advance.

IMHO I think property prices have risen dramatically in certain areas of Thailand in the last few years - but i have a real question regarding the market of "second hand" property. Rather than basing the current property prices on NEW developments I think it is much more interesting (and accurate) based on the actual price paid for EXISTING developments....

Again, IMHO, I dont think the Thais embrace "second hand" properties in the same way as westerners do.

[Heng]

As a Thai I certainly do NOT have an aversion to second hand property (here's a secret: all land is Nth hand and has likely been lived on and died on by thousands of people). But mostly to rent them out to foreigners. Although I do have a good number of Thai tenants as well. There is some Thai aversion to second hand housing, but that quickly disappears if we're talking commercial buildings, shop houses, etc.

[jonik]

please show me where in thailand you can get 400% return on anything.

its ok someone telling you your property is worth this now,just try selling.

i come from australia.

i still think renting is the best option.

Well if you buy something for 2 and sell for 8 mill i would call it an 400% increase value.

As a Thai I certainly do NOT have an aversion to second hand property (here's a secret: all land is Nth hand and has likely been lived on and died on by thousands of people). But mostly to rent them out to foreigners. Although I do have a good number of Thai tenants as well. There is some Thai aversion to second hand housing, but that quickly disappears if we're talking commercial buildings, shop houses, etc.

I suppose most of the land and houses with seaview are sold to foreigners.

[Gary A]

Renting or buying depends on what position a person is in. Buying property in Thailand other than a condo is a risky thing to say the least. I have been accused of fear mongering but the law is the law whether it is being enforced or not. That said when I retired here I viewed rent as the biggest variable that I would face. I looked at condos for over a year before I took the leap. Watching prices convinced me that a more upscale condo was a better buy. Besides that I couldn't be comfortable in a 32 square meter shoe box. To appreciate in price the condo must be in a good secure location and it should be in a well maintained development. I would say that the minimum size should be 54 square meters for comfortable living. The key point I'm trying to make is that I bought my condo to live in and not to make a profit. I'm pleased that in less than two years it has increased in value about 35 percent. That property is part of my security blanket and I feel good having a place of my own.

[Heng]

please show me where in thailand you can get 400% return on anything.

its ok someone telling you your property is worth this now,just try selling.

i come from australia.

i still think renting is the best option.

Well if you buy something for 2 and sell for 8 mill i would call it an 400% increase value.

As a Thai I certainly do NOT have an aversion to second hand property (here's a secret: all land is Nth hand and has likely been lived on and died on by thousands of people). But mostly to rent them out to foreigners. Although I do have a good number of Thai tenants as well. There is some Thai aversion to second hand housing, but that quickly disappears if we're talking commercial buildings, shop houses, etc.

I suppose most of the land and houses with seaview are sold to foreigners.

There aren't nearly enough foreigners here to support that marketing strategy for most products, much less beach front real estate... although given, some developments in Phuket and Pattaya do appear that way.

[jonik]

Not enough foreigners ? They are selling thaipropertys in the local newspaper back home. Friend of mine sells thai properties for foreign companies and he sais the market is blooming. Old folks are looking for other alternatives than spain and croatia, cause the prices are to high and LOS is bullseye for them. But given the fact that you're not allowed to own land in los most of em buy exclusive condoes. But if the gouverment comes around and allow foreign landlords then..................

[johnnyk]

In my mind there is no doubt the various restrictions on falangs owning property hold real estate prices down.

In Costa Rica 15 years ago falangs could own property but if they sold it they could not export more than they paid for it. This made for huge bargains, if you could live with that.

A few years after I was there they lifted the restriction and property prices exploded as sellers could get their money out of the country.

If Thailand lifted the current hurdles I think you would see insane prices.

Edited January 6, 2006 by johnnyk

[the gent]

In my mind there is no doubt the various restrictions on falangs owning property hold real estate prices down.

In Costa Rica 15 years ago falangs could own property but if they sold it they could not export more than they paid for it. This made for huge bargains, if you could live with that.

A few years after I was there they lifted the restriction and property prices exploded as sellers could get their money out of the country.

If Thailand lifted the current hurdles I think you would see insane prices.

Honestly, what absolute drivel.

The Sino Thai claque determines the market and nothing else. Whether or not it is through shell companies operating offshore or in loaded partnerships, it matters not one jot. Falangs are irrelevant.Unless of course you are one with delusions as to your self worth.

[johnnyk]

In my mind there is no doubt the various restrictions on falangs owning property hold real estate prices down.

In Costa Rica 15 years ago falangs could own property but if they sold it they could not export more than they paid for it. This made for huge bargains, if you could live with that.

A few years after I was there they lifted the restriction and property prices exploded as sellers could get their money out of the country.

If Thailand lifted the current hurdles I think you would see insane prices.

Honestly, what absolute drivel.

The Sino Thai claque determines the market and nothing else. Whether or not it is through shell companies operating offshore or in loaded partnerships, it matters not one jot. Falangs are irrelevant.Unless of course you are one with delusions as to your self worth.

Read the post, anal orifice.

It talks about C.R. and then it says "If Thailand lifted..."

"If" is a conditional, it is not reality or fact.

Now go blow your nose and have a wank.

[Dragonman]

In my mind there is no doubt the various restrictions on falangs owning property hold real estate prices down.

In Costa Rica 15 years ago falangs could own property but if they sold it they could not export more than they paid for it. This made for huge bargains, if you could live with that.

A few years after I was there they lifted the restriction and property prices exploded as sellers could get their money out of the country.

If Thailand lifted the current hurdles I think you would see insane prices.

Honestly, what absolute drivel.

The Sino Thai claque determines the market and nothing else. Whether or not it is through shell companies operating offshore or in loaded partnerships, it matters not one jot. Falangs are irrelevant.Unless of course you are one with delusions as to your self worth.

If farangs are irrelevant in local markets how do you explain the discrepancy in property values in such places as Pattaya. All open markets are driven by cash availability and demand. Supply is enormous in Thailand, but not where the people with the incoming cash wish to live. Prices increases in tourist areas are based more on property values in UK, Oz, USA, etc than Thailand.

[Heng]

Falangs are important to the rental market in a lot of areas. Most of my tenants are those who could afford their own homes here (well, finance anyway), are business owners or retirees, but are too skittish to because of the laws and most banks don't loan to foreigners. That leaves the cash crowd (and not just enough cash to own... enough cash to not care about losing it all if things turn south here), which in any market is a minority anyway, hardly a segment that will "support the market."

Edited January 9, 2006 by Heng