The Effect Of The Strong Baht On Foreign Purchases

[fish fingers]

I've noticed sites advertising new to market developments (sites specifically aimed at foreign buyers) are slashing prices, as much as 60% reductions for villas, and also some big reductions on new condos. This is specifically areas such as Hua Hin with a concentration of new to market sales but also Chiang Mai agents are experiencing a shortage of foreign buyers too.

Seems a bit panicky right now, with the continuing rise of baht against other currencies. Very interesting times.

[PattayaPhom]

60% off where us that??? Its only a few basket currencies that are suffering so not panicky as you suggest. Baht is Baht to Thais who at present are the predominant buyers. Rubles aint so bad either

[LennyW]

60% off suggests they were grossly overpriced in the first place and the developer has realised this is why they are not shifting, nothing to do with the performance of foreign currency.

[davejones]

60% off suggests they were grossly overpriced in the first place and the developer has realised this is why they are not shifting, nothing to do with the performance of foreign currency.

I agree with this. It's like when supermarkets put the price up to a ridiculous level just so they can say they offer a big discount a few days later. So a 4 million condo is put up for sale at 10 million, and then reduced 60% to the 4 million condo it really is. I would steer well clear of condos that have these kinds of offers, as I just wouldn't trust the sellers.

[54321]

from my experience a company launch a new development, and at launch the best units are sold first, tehn 18 months later they advertise the other remaining units at a big discount. Not quite the other units, but a unit at a lower price which may or may not be sold but the advert generates many enquiries. In addition, Thais make up teh vast majority of purchases so the strength of the baht is only a small issue to only a small percentage of buyers. I could be wrong but thats the way I see it

[mccw]

In Chiang Mai the new condos look more expensive and in "up and coming" / not so central locations; but many are already on to second or 3rd building, first phases sold out and mostly their info is in Thai and the reps speak limited or no English. So I'd say they are targeted at mostly Thais and are selling well.

How long it will last is another question.

I've read things in international press singing CMs praises aswell; saying that compared to saturated markets like Puket and Samui, bali, hongkong or bkk, etc, it is still under valued / at the start of a boom with a long way to run yet. Internationally its the new find and this is early stage to get in; but for CM long term residents its like top of all time construction doomed to crash. So who is right?

Gaining international recognition is probably signalling the start rather than an end in my opinion. Asians looking for holiday retreat or place to invest. However that doesnt mean condos will boom in value or anything. but maybe hold steady with modest increase potential. Land I see as much more upside than condos which can just be replicated until over supply. Land is limited obviously.

[mccw]

Bht strength effect or not could work both ways. Farangs with devaluing currencies might be looking to buy more units than what once might have been the sole residence, for purpose of bht income with 100% ownership + currency hedge/ speculation.

5-10 years ago the mantra of many was "never invest in Thailand" , "keep money safe in farang land" etc. Now they seen £,euro,dollar drop in value by 30% + with no end to the printing in sight and could be think its time to get in and do something about it it.

Edited March 9, 2013 by mccw

[pinfold]

The son of the owner where I stay (a Thai /Brit) fronts up new sales from the major developers,, here,he is one smooth operator even if I say it,informs me that it is a waste of time even getting out of bed these days,nothing selling to the English speaking lot,do not know about Russkies,but where they buy Id stay a million miles away

[meatboy]

our house has 30% more equity owing to the ex.rate and that is in 3yrs.

new houses built by the same co.have gone up as has the land.

could be a lean time for farang buyers.