GBP to THB Exchange Rate

[chiang mai]

Whilst not directly related to the GBP/THB exchange rate, the UK housing market bears a direct relationship to the strength of Sterling. Most UK readers of the UK press of any kind over the past two months cannot possibly have failed to notice the extent to which governement (via the media) has been ramping stories about how well the market is doing, it's finally recovered they said, people are now making fortunes out of property once again, blah blah blah.

Well today the Land Registry report for June was published and property owners in Central London are indeed doing well, the rest of the country much less so. Fact is prices are up overall 0.6% on the month and 0.8% YoY, in other words flat (or falling if London if excluded)..

I'm afraid the governements pump and dump campaign will have to do better if they want positive results and in turn, GDP to increase.

[yoshiwara]

Whilst not directly related to the GBP/THB exchange rate, the UK housing market bears a direct relationship to the strength of Sterling. Most UK readers of the UK press of any kind over the past two months cannot possibly have failed to notice the extent to which governement (via the media) has been ramping stories about how well the market is doing, it's finally recovered they said, people are now making fortunes out of property once again, blah blah blah.

Well today the Land Registry report for June was published and property owners in Central London are indeed doing well, the rest of the country much less so. Fact is prices are up overall 0.6% on the month and 0.8% YoY, in other words flat (or falling if London if excluded)..

I'm afraid the governements pump and dump campaign will have to do better if they want positive results and in turn, GDP to increase.

You will often find that Brits in Thailand who are holding UK property are less exercised by the value of the property and rather more focussed on it being rented out on a regular basis.

[chiang mai]

Whilst not directly related to the GBP/THB exchange rate, the UK housing market bears a direct relationship to the strength of Sterling. Most UK readers of the UK press of any kind over the past two months cannot possibly have failed to notice the extent to which governement (via the media) has been ramping stories about how well the market is doing, it's finally recovered they said, people are now making fortunes out of property once again, blah blah blah.

Well today the Land Registry report for June was published and property owners in Central London are indeed doing well, the rest of the country much less so. Fact is prices are up overall 0.6% on the month and 0.8% YoY, in other words flat (or falling if London if excluded)..

I'm afraid the governements pump and dump campaign will have to do better if they want positive results and in turn, GDP to increase.

You will often find that Brits in Thailand who are holding UK property are less exercised by the value of the property and rather more focussed on it being rented out on a regular basis.

It makes me wonder how sensible it is to earn income in a declining currency on an asset that is declining in value, whilst spending Thai Baht, that model doesn't work for me I'm afraid.

[yoshiwara]

Whilst not directly related to the GBP/THB exchange rate, the UK housing market bears a direct relationship to the strength of Sterling. Most UK readers of the UK press of any kind over the past two months cannot possibly have failed to notice the extent to which governement (via the media) has been ramping stories about how well the market is doing, it's finally recovered they said, people are now making fortunes out of property once again, blah blah blah.

Well today the Land Registry report for June was published and property owners in Central London are indeed doing well, the rest of the country much less so. Fact is prices are up overall 0.6% on the month and 0.8% YoY, in other words flat (or falling if London if excluded)..

I'm afraid the governements pump and dump campaign will have to do better if they want positive results and in turn, GDP to increase.

You will often find that Brits in Thailand who are holding UK property are less exercised by the value of the property and rather more focussed on it being rented out on a regular basis.

It makes me wonder how sensible it is to earn income in a declining currency on an asset that is declining in value, whilst spending Thai Baht, that model doesn't work for me I'm afraid.

It works for many on a number of levels. First of all they don't start with a pot of money but rather their home in an area they understand and can get the income. Liquidating the asset not only kills off possible income but puts pressure on what to do with the money and mistakes can be made once the money is burning a hole in their pocket. The property might decline in value over periods and the currency also but if the net income is in excess of spending needs then there is a cushion. Secondly the property provides a fall-back position if there is a need or desire to return home. In short it provides some insurance.

[mccw]

If looking at rental yields on investment then it all depends on area and property type selection. I purchased in around the post crash bottom. I worked out 11-13% pa return on total price price. But because of mortgage leverage that becomes more like 25-33%; I couldn't get this credit in another country and I haven't been able to find such good returns on researching other countries either. Some few far between 6-8%s in Canada and Thailand i have found but no such good credit available to me to me so its a choice of taking 6% or making 25% , even with a falling £ this is still a winner.

Generally if the % rental yield is over 5% then I don't think the markets over valued. Power than that and a good chance . Like the non south east England properties bought on speculation or holiday home basis pre crash. These prices may never recover, or indeed could fall further. As could central London, Hongkong etc such over bought places on speculation or "safe haven" status, seeing real negative yields after costs and inflation; like 1-3%, is real danger zone for a capital value fall.

On my places- if capital value falls then I don't much care because I'm in it for the income, (but my equity is actually more than doubled on most places), if interest rates rise a bit its not the end of the world because the income is high enough to cover it. Keeping the properties rented is the main thing and in the right areas its easy because of huge student or worker demand and a lack of supply because of the strict planning laws and over regulation and standards on building. In Thailand they can and will just build build build until over supply comes along one day and suppresses rents and prices; it already does suppress rents and prices are only supported really by the collective market support/ fixing by the Thai banks practice of not doing any fire sale auction on any property but rather holding on to it for the full loan value.

Even if you are a pot of cash person then I'd say a property producing a sizeable income in a good location is still not a bad investment even if it looses capital value. Why? because at least you may loose some capital value but you can not loose all of it. Such a house never becomes worthless or defaulted on like a stock, share or bond. Even if you are getting a low % it will still be better than the bank and it can't be snatched away like a Cyprus situation or other wise vanished like a banking collapse or MF Global. Even currency collapse the house comes out the other side as still a house that people want to live in and people will pay in the new currency to stay there. PMs and other physical goods, commodities, art are always worth something but don't produce any income; farm land can produce income but not so much and more work/ hassle unless you rent it out at a pittance. So residential property represents the best solid and safe investment available and if selected and/or leverage correctly can yield more than most alternatives on a PA income perspective. maybe can make more speculating / gambling on the ups and downs of capital values on certain stocks or bonds but that's a whole different level of risk.

[mccw]

Something on the currency side consideration of holding gbp based property; if mortgaged then a slide in value in the pound does loose one income if living in Thailand for example but if you have Thai or other counter assets as a hedge then they could pay off some of the debt now that its worth less and so then your debt servicing costs or repayments go down and the income amount may some what balance out to what it was before and even be a blessing / leave you coming out better off if the market turns back the other way.

Hedging options are giving me lots to think about. Go for greater sizes in Hedge or just strive to pay off the debt? accepting a lower % actual return as a result. Obviously some hedge can still make a few %. Or another way to look at it is the hedge money starting point is minus 5% because that is what the loans are costing which could be cleared in stead.

[mccw]

Another consideration is tax.

If UK income is up after the 40% tax level then I'm wondering, maybe its not worth expanding further just to give so much away to the government. Maybe it would be better to accept a bit less % return in another country and pay local lower tax rate, as locally you would be a lower earner bracket.

Any real maths guys like to work that out for me exactly?

My rough mental reasoning, having not done the sums properly on paper yet, tells me that if using mortgage leverage compared to none then uk property still comes out more profitable even after the 40% tax; but if going full cash then the implications become a lot closer and a couple % on the returns can throw it either way. In which case diversifying countries/ currencies may be better than eggs all the one or two basket.

[mccw]

Does any one know if debts can be enforced internationally?

Like say interest rates exploded in the UK and I decided I had to default of the mortgages. Even after auction sale the uk banks can come after you for the left over debt in the UK, make attatchment of earnings orders through the courts or other ways to get the money back. I wonder , if I had a banks or property in Canada, USA or Australia could they come after those assets?

[Cambodger]

I've been watching the exchange rates since the baht went down into the low 40s before pulling back to where it is now around the 47 mark.

My main point is that since April it appears the baht almost seems to be (again) pegged against the US dollar at 31. Also in the BP a few weeks ago the some finance minister mentioned that they'd used some foreign reserves to help stabilise the baht, though this was just reported as a throw away comment in a article on the set been down that day.

Could this be connected with the 2.2 trillion loan?

Personally (i'm definitely no expert) but i cant see how the currency is holding up so well.

Thailand seems to be heading in to a perfect storm with political unrest, falling exports, rising personal debt, rice pledging, shrimp farming losing 50%, possibly flooding again, outflows of foreign investment, massive corruption etc the list really is endless...

But still the baht holds its own.

[chiang mai]

Exports falling from where to where? There's a clue to your question in the answer.

Indeed, watching USD/et al will give the answer.

Hi Yosh

[Naam]

Thailand seems to be heading in to a perfect storm with political unrest, falling exports, rising personal debt, rice pledging, shrimp farming losing 50%, possibly flooding again, outflows of foreign investment, massive corruption etc the list really is endless...

But still the baht holds its own.

yep! it's now seven full years that these or similar "facts" are presented in a dozen or more forum threads. usually with the addition "but now the time has come...".

Edited August 3, 2013 by Naam

[mccw]

My thoughts Rogue trader:

Thai exports are expanding aren't they?

As is tourism

As is GDP

No?

Links

Corruption - even with the skimming they get infrastructure built twice as fast and for half the cost than they do in the west.

2trillion bht loan will still only put Thai debt to GDP at around 50% wich is loads better than any western country.

Rates if fixed now is the best time every to borrow because we are at record never before seen low rates/ bond bubble. If they fix these rates now and use money for decent infrastructure projects it can set Thailand up for long term benefits and short/ medium term gdp boost. Even with lots of skimming I still think they can get plenty good out of it.

Political problems; they have been present for years but the economy and currency carry on regardless.

Floods- could happen yes, but not the end of the world.

Lastly; I like to make clear I am anti red mafia idiots and mixed up communist lunatics, I find the payments to red shirts and prisoner amnesties sickening; however the economics I tell how I can see it working.

Rice pledging is a dumb political and corruption stunk which is a waste of money for sure; but I don't think it will break the bank.

I think that a prolonged attempt to hold the bht down in line if events heavily a falling dollar could see external forces trying to break the peg, most likely win and lead to a massive jump upwards of the bht; leading to quite a not of turmoil such as exporters going out of business lower tourist numbers; but then there could be possible upsides. They could turn to consumer driven and start a 30 year dept run like west has just been on.

[AnotherOneAmerican]

I've been watching the exchange rates since the baht went down into the low 40s before pulling back to where it is now around the 47 mark.

My main point is that since April it appears the baht almost seems to be (again) pegged against the US dollar at 31. Also in the BP a few weeks ago the some finance minister mentioned that they'd used some foreign reserves to help stabilise the baht, though this was just reported as a throw away comment in a article on the set been down that day.

Could this be connected with the 2.2 trillion loan?

Personally (i'm definitely no expert) but i cant see how the currency is holding up so well.

Thailand seems to be heading in to a perfect storm with political unrest, falling exports, rising personal debt, rice pledging, shrimp farming losing 50%, possibly flooding again, outflows of foreign investment, massive corruption etc the list really is endless...

But still the baht holds its own.

Next year the baht will get somewhere between 35 and 90 bht to the UKP (25 and 60 bht to the dollar).

You would need a crystal ball to predict where it will be.

Value will have very to do with the UK economy (or the US economy).

All to do with an elephant in the room.

All to do with corrupt Thai politicians stealing while they can.

Edited August 3, 2013 by AnotherOneAmerican

[Cambodger]

Thanks for the responses, as i said i'm no expert in fact i my knowledge of economics is very limited to say the least, but the place just doesn't seem to and up anymore.

In the last couple of years there just seems to be so much cash thrown around the place, everyone just seems to have loads of it.

A few months ago i notice something that shocked me, i was in Bkk having a beer when a Thai couple came in, they didnt look rich or hi-so types low middle class at best, they ordered 2 heinikens, messed about with there iphones a bit had a few sips paid the bill and left, this was on soi 11 and the beers were 150 bht each. Thats a days work to some Thais, and i know i couldn't walk away from those beers and i dont know many people who would.

Thats probably a story for the general forum i know but it just struck a chord with me.

There isnt that much going on there compared to the west, lots of low paid manufacturing jobs for foreign companies.

In the UK i dont know anyone thats really struggling at the moment but the place just seems to have been ticking over for the last 5 years, but it definitely seems to be picking up a bit of steam.

[yoshiwara]

Thanks for the responses, as i said i'm no expert in fact i my knowledge of economics is very limited to say the least, but the place just doesn't seem to and up anymore.

In the last couple of years there just seems to be so much cash thrown around the place, everyone just seems to have loads of it.

A few months ago i notice something that shocked me, i was in Bkk having a beer when a Thai couple came in, they didnt look rich or hi-so types low middle class at best, they ordered 2 heinikens, messed about with there iphones a bit had a few sips paid the bill and left, this was on soi 11 and the beers were 150 bht each. Thats a days work to some Thais, and i know i couldn't walk away from those beers and i dont know many people who would.

Thats probably a story for the general forum i know but it just struck a chord with me.

There isnt that much going on there compared to the west, lots of low paid manufacturing jobs for foreign companies.

In the UK i dont know anyone thats really struggling at the moment but the place just seems to have been ticking over for the last 5 years, but it definitely seems to be picking up a bit of steam.

Impressionism can lead you down some strange pathways, but decisions in the end are made which might not amount to much. Say you had £20k at the beginning of each year which you can either drip feed into baht or change at the beginning. Even with a net 10% appreciation in your favour at the end of the process, you have made the grand total of £2k. Not earth shattering. It might be if you were investing pots into Thailand, but probably as well to clarify if we are talking spending money or 'investing in Thailand' money.

[Naam]

AnotherOneAmerican

Next year the baht will get somewhere between 35 and 90 bht to the UKP (25 and 60 bht to the dollar).

we all like precise forecasts!

[yoshiwara]

AnotherOneAmerican

Next year the baht will get somewhere between 35 and 90 bht to the UKP (25 and 60 bht to the dollar).

we all like precise forecasts!

I recall having a discussion with a friend who was 'absolutely convinced' that shares were going to collapse 50% 'in the next 6 months'. 'OK' I said 'well in that case you should sell your whole share portfolio now and buy them all back so much cheaper after the big fall'. Oh no he couldn't do that blah, blah. 'In that case' I pointed out 'we should discount what you say and just follow what you do, which is in complete contradiction to what is coming out of your mouth'. He was not very happy about that at all.

[yoshiwara]

AnotherOneAmerican

Next year the baht will get somewhere between 35 and 90 bht to the UKP (25 and 60 bht to the dollar).

we all like precise forecasts!

I recall having a discussion with a friend who was 'absolutely convinced' that shares were going to collapse 50% 'in the next 6 months'. 'OK' I said 'well in that case you should sell your whole share portfolio now and buy them all back so much cheaper after the big fall'. Oh no he couldn't do that blah, blah. 'In that case' I pointed out 'we should discount what you say and just follow what you do, which is in complete contradiction to what is coming out of your mouth'. He was not very happy about that at all.

Haha; You love to tell this story Yoshi! every few days on at least one thread or another; I bet you bore all your dinner guests with it repeatedly too, haha cutting off the conversation and thinking you scored points by saying something smart, but forgetting they've all heard it a hundred times already; I bet they just take a deep long sip and role their eyes. Even here you drop it where the guy quoting "35 to 90" is clearly just joking with such a huge range and so your comment bares no relevance at all/ there is no position to take in what he said.

Sorry to bore everybody but the point still holds that what people say and what they do are often in contradistinction. The same thing applies to the GBPTHB rate. Individuals will forecast furiously about what they think the rate will be in 6 months / 12 months but actually their actions more often than not belie that prediction. They will sit on their hands while making frenzied predictions. The wild range prediction above is just a joke on that theme. It is case studies based on what people do which clarifies the situation as opposed to merely cluttering up the threads with copying and pasting anything which sounds vaguely negative and the insinuation of dark conspiracies leaking out of any and every negative news item. On the other hand my memory isn't what it used to be (if it ever was).

[Huayrat]

Can we keep on topic please..

[mccw]

As British pound related to health of economy, here is some more on the housing market:

""""The so-called 'bad bank' behind failed lenders Northern Rock and Bradford & Bingley paid another £1.9bn to taxpayers in the first half of the year and saw a sharp fall in soured loans.

UK Asset Resolution (UKAR), the state-owned firm responsible for winding down the mortgage books of the collapsed banks, said Government repayments surged more than 70% from £788m a year earlier.

Its underlying pre-tax profits increased 10% to £529m as the improving economy and housing market saw the number of borrowers in severe arrears drop 29%.

Repossessions fell more than 8% to 3,871 and charges for bad debts dived.

Chief executive Richard Banks said: "All that suggests that the economy is starting to improve and people's finances are starting to improve."

Britain's housing market has been stimulated in recent months by Government schemes that have boosted mortgage approvals and lifted prices.

In a separate report today, the lender Halifax said house prices increased at their fastest pace in almost three years in July - rising 4.6% on an annual basis, 0.9% month-on-month.""""

-sky news app.

(Those are hard facts; not random surveys of sentiment)

[chiang mai]

Perhaps someone can explain to me how repo's can be falling when substantial numbers of people are reliant on pay day loans and everyone is feeling more stretched than ever before.

Also, The Nationwide and the Halifax have both shown monthly increases circa 0.9% but we have yet to understand what part of that increase is Central London and Wales (Wales, which previously suffered huge falls and is now playing catch up and slowly comming back to more normal levels). Looking at the most recent Land Registry report would suggest that anywhere outsdie of those two areas is seeing flat or falling prices.

[Cambodger]

Perhaps someone can explain to me how repo's can be falling when substantial numbers of people are reliant on pay day loans and everyone is feeling more stretched than ever before.

Also, The Nationwide and the Halifax have both shown monthly increases circa 0.9% but we have yet to understand what part of that increase is Central London and Wales (Wales, which previously suffered huge falls and is now playing catch up and slowly comming back to more normal levels). Looking at the most recent Land Registry report would suggest that anywhere outsdie of those two areas is seeing flat or falling prices.

The people who are feeling the pinch are generally low paid unskilled workers, mainly due to inflation and cuts to working benefits. That your Wonga customer.

Anyone with a half decent job is ticking along just fine and those with mortgages have been quids in over the last few years due to low interest rates.

Something I've also noticed is people don't seem to buy into the crazy consumerism culture (see Thailand now) that was so prevalent before the crisis, definitely more savvy in their purchases.

The moods changing and the economy is finally moving again.

[mccw]

Brighton is doing nicely.

Greater London and it burbs are alright too.

[mccw]

This from another piece about average wages from 2010 until the resent day.

""Real wages are now 8.1% lower in Yorkshire and the Humber, compared to a 5.5% decrease in the South East, the figures showed."

-sky news app

[chiang mai]

Perhaps someone can explain to me how repo's can be falling when substantial numbers of people are reliant on pay day loans and everyone is feeling more stretched than ever before.

Also, The Nationwide and the Halifax have both shown monthly increases circa 0.9% but we have yet to understand what part of that increase is Central London and Wales (Wales, which previously suffered huge falls and is now playing catch up and slowly comming back to more normal levels). Looking at the most recent Land Registry report would suggest that anywhere outsdie of those two areas is seeing flat or falling prices.

The people who are feeling the pinch are generally low paid unskilled workers, mainly due to inflation and cuts to working benefits. That your Wonga customer.

Anyone with a half decent job is ticking along just fine and those with mortgages have been quids in over the last few years due to low interest rates.

Something I've also noticed is people don't seem to buy into the crazy consumerism culture (see Thailand now) that was so prevalent before the crisis, definitely more savvy in their purchases.

The moods changing and the economy is finally moving again.

Is it really moving or is it smoke and mirrors?

http://blogs.telegraph.co.uk/finance/jeremywarner/100025283/its-growth-alright-but-not-as-they-would-like-it-the-mirage-of-britains-economic-recovery/

Honestly I'm very uncertain which it is, what I do know is that there's a huge amount of governement spin being spewed forth and that in itself is masking the reality to some degree. I understand only too well the concept of improving sentiment in order to get the consumer to spend thus improving GDP thus improving the chances of re-election, It's that last part that's the problem, question is, would the governement out and out lie about the recovery, falsify reports/records and such in order to get re-elected? I say yes they would, after all, the 2014 Right to Buy scheme is hardly something that's in the nations best interests, it does two things only and that's increases property prices and fuels bank profits.

And in a second report on the economy this morning the headline is simply worderful but look at the detail, especially the last couple of lines in the article, and they even got some unknown economist from some unknown company to say it was all "wow"! I mean, it's not as though GDP is ever revised downwards after the fact!!

http://www.telegraph.co.uk/finance/economics/10225737/UK-economic-recovery-gains-pace-in-July-says-NIESR.html

Edited August 6, 2013 by chiang mai

[Bluemoon66]

You mean you've never heard of Berenberg Bank?

WOW!!

Edited August 7, 2013 by Bluemoon66

[chiang mai]

You mean you've never heard of Berenberg Bank?

WOW!!

A private German bank with assets of only 26 bill, no, why would I. And a straw poll of TV members showed that out of 426,000 members only six had and it's believed that two of them lied.

[Naam]

You mean you've never heard of Berenberg Bank?

WOW!!

A private German bank with assets of only 26 bill, no, why would I. And a straw poll of TV members showed that out of 426,000 members only six had and it's believed that two of them lied.

Berenberg = albeit small, one of the finest private German banks!

[mccw]

CM

The whole uk banking system and house hold spending and therefore wider economy is reliant of the health of the housing market; the government knows this, hence the policy. So I think it is in the nations interests; so long as they don't let it get out of control but with proper credit checks it should be fine and not end up like the US debacle. Other policies could be brought in to increase affordability with out damaging the wider market; such as scrapping the EU lead over regulation of building standards/ CO2 green bla bla bla- allowing cheaper houses to be built for first time buyers or part ownership schemes.

(Disclaimer- I recognise I could be wrong and the whole thing blow up, but that could happen anyway.)

[cardholder]

You mean you've never heard of Berenberg Bank?

WOW!!

A private German bank with assets of only 26 bill, no, why would I. And a straw poll of TV members showed that out of 426,000 members only six had and it's believed that two of them lied.

Size is not necessarily important in this context.