Condo market saturated in CM?

[jaideeguy]

The following link to a recent article implies that it might be approaching saturation...........

http://www.nationmultimedia.com/business/Chiang-Mai-condo-supply-hits-high-in-May-30210021.html

Makes me wonder how the moo baan market is doing , as I see so many units under construction and wonder where the buyers will come from??

[jko]

Do not worry - many people were asking similar questions in Bangkok in the early nineties, when cranes and construction sites were growing like mushrooms, everywhere you looked.

Who will fill all these offices? Rent all these condos? Stay at all these hotels!

In my opinion, Chiang Mai will thrive, and so will the real estate market, but with the same market crises along the way.

It will not however be a very pleasant place to live.

Even now, it is growing into a bit of a horror story, but many people - including Chinese tourists - don't care about environmental considerations, or the quality of life, as long as material things are in abundance, so prepare for much, much more construction.

Even if there is a crash due to Thai politics, the world economy or warfare, Bangkok's history tells us things always eventually recover.

Life goes on as they say, and so unfortunately will 'development' - until maybe one day, Mother Earth strikes back.

[Gonzo the Face]

Dam*n .... thats HEAVY !!!

[mic6ard]

Dam*n .... thats HEAVY !!!

Too right

[mic6ard]

Personally. I think that the market is so much more supplies than demand. I think that the bubble will burst, but as bad as some thinks.

Right now it'll have to survive long enough for AEC to come on line, then there will hopefully be a flood of investment into CM.

[elektrified]

Do not worry - many people were asking similar questions in Bangkok in the early nineties, when cranes and construction sites were growing like mushrooms, everywhere you looked.

Who will fill all these offices? Rent all these condos? Stay at all these hotels!

In my opinion, Chiang Mai will thrive, and so will the real estate market, but with the same market crises along the way.

It will not however be a very pleasant place to live.

Even now, it is growing into a bit of a horror story, but many people - including Chinese tourists - don't care about environmental considerations, or the quality of life, as long as material things are in abundance, so prepare for much, much more construction.

Even if there is a crash due to Thai politics, the world economy or warfare, Bangkok's history tells us things always eventually recover.

Life goes on as they say, and so unfortunately will 'development' - until maybe one day, Mother Earth strikes back.

Good post. I agree with what you are saying with the exception that this is not Bangkok, not an International destination, no port, more of a holiday destination.

[jko]

Do not worry - many people were asking similar questions in Bangkok in the early nineties, when cranes and construction sites were growing like mushrooms, everywhere you looked.

Who will fill all these offices? Rent all these condos? Stay at all these hotels!

In my opinion, Chiang Mai will thrive, and so will the real estate market, but with the same market crises along the way.

It will not however be a very pleasant place to live.

Even now, it is growing into a bit of a horror story, but many people - including Chinese tourists - don't care about environmental considerations, or the quality of life, as long as material things are in abundance, so prepare for much, much more construction.

Even if there is a crash due to Thai politics, the world economy or warfare, Bangkok's history tells us things always eventually recover.

Life goes on as they say, and so unfortunately will 'development' - until maybe one day, Mother Earth strikes back.

Good post. I agree with what you are saying with the exception that this is not Bangkok, not an International destination, no port, more of a holiday destination.

Yes - point well taken, but I think we can expect more international flights, more investment, more companies moving up here, and with the AEC round the corner, plus Burma opening up, things will go much faster than you think, so I rest my 'heavy' case!

[heybruce]

Do not worry - many people were asking similar questions in Bangkok in the early nineties, when cranes and construction sites were growing like mushrooms, everywhere you looked.

So Chiang Mai looks like Bangkok before the '97 economic crisis? The one that left countless building projects abandoned in place, standing half-empty and neglected for years? Right, nothing to worry about here.

[JomtienEats]

So Chiang Mai looks like Bangkok before the '97 economic crisis? The one that left countless building projects abandoned in place, standing half-empty and neglected for years? Right, nothing to worry about here.

I agree. I'd be cautious about putting down a deposit on any proposed condo in Chiang Mai because of the risk it never gets built.

[anto]

If the Russians start coming to Chiang Mai in numbers like they go to Pattaya ,then there will be a huge shortage of Condos in Chiang Mai .

Chiang Mai as Thailands second City is still quite small and has a long way to grow .

[OldChinaHam]

Let us all wait for the real nadir in price, with concurrent vast oversupply like we see in Shanghai.

Let us go out and photograph the night cityscape to measure the ratio of lit to dark flats.

Let us get a handle on electricity usage broken down by individual flat and building and sector like they do in Shanghai.

When China really stumbles, and maybe even tumbles, then we know we can expect the nadir of the CM Condo price curve.

But I do not know when the Chinese government will miscalculate the economic controls, or their reins on power over the oppressed people.

When thinking about CM condo prices for the long term, you really must consider also the China Syndrome.

Prices could suddenly start falling toward the center of the earth, just as Jack Lemmon and Jane Fonda feared.

[jko]

Do not worry - many people were asking similar questions in Bangkok in the early nineties, when cranes and construction sites were growing like mushrooms, everywhere you looked.

So Chiang Mai looks like Bangkok before the '97 economic crisis? The one that left countless building projects abandoned in place, standing half-empty and neglected for years? Right, nothing to worry about here.

You miss my point heybruce - yes, I watched the '97 crisis devastate the market at very close range.

I'm talking in terms of the long run - try buying a decent condo in Bangkok today and see what it costs you per square metre. . Nobody would have dreamed about these kind of rates back then. Same is likely to happen here, it just takes time, with probably a few crashes in between. Watch this space.

[elektrified]

So Chiang Mai looks like Bangkok before the '97 economic crisis? The one that left countless building projects abandoned in place, standing half-empty and neglected for years? Right, nothing to worry about here.

I agree. I'd be cautious about putting down a deposit on any proposed condo in Chiang Mai because of the risk it never gets built.

There are a number of early-stage projects already abandoned, some with bank signs, etc. It is already happening.

[elektrified]

If the Russians start coming to Chiang Mai in numbers like they go to Pattaya ,then there will be a huge shortage of Condos in Chiang Mai .

Chiang Mai as Thailands second City is still quite small and has a long way to grow .

Are you talking about Russians coming in hordes and renting condos?

[JomtienEats]

If the Russians start coming to Chiang Mai in numbers like they go to Pattaya ,then there will be a huge shortage of Condos in Chiang Mai .

Chiang Mai as Thailands second City is still quite small and has a long way to grow .

Are you talking about Russians coming in hordes and renting condos?

I don't think we'll see Russians coming to Chiang Mai en masse. They want a beach when they go on holiday. There are some Russian programmers around, but not the package tour hordes. Other posters are right - it's the Chinese and political fortunes that will determine the future of CM's condos.

[OldChinaHam]

If the Russians start coming to Chiang Mai in numbers like they go to Pattaya ,then there will be a huge shortage of Condos in Chiang Mai .

Chiang Mai as Thailands second City is still quite small and has a long way to grow .

Are you talking about Russians coming in hordes and renting condos?

I don't think we'll see Russians coming to Chiang Mai en masse. They want a beach when they go on holiday. There are some Russian programmers around, but not the package tour hordes. Other posters are right - it's the Chinese and political fortunes that will determine the future of CM's condos.

Thank you sir, that you seem to concur with my Chinese assessment.

But why are people talking about Russian Hordes? It is definitely true that I would prefer the Chinese moving in. But if it must be Russians, then I just hope it is the children of White Russians.

By the way, do you have any timeline for a possible major crisis in China?

I really think that this time their govenrment's days are numbered.

There are too many economic forces impinging at this time, including pollution, water resources, and other resources for which they must venture into places like Africa.

I often wonder how such a crisis will influence daily life, the real estate situation, even average income, in Chiang Mai since we are so very close to China.

[JomtienEats]

There are a number of early-stage projects already abandoned, some with bank signs, etc. It is already happening.

Yes, this thread on the Astra is relevant -

http://www.thaivisa.com/forum/topic/619016-pre-sale-the-astra-starts-tmrw/page-2#entry6563857

Anyone have more news on what's going on there?

[OldChinaHam]

Is there much truth to the story that I was told, that much of this development is taking place on land which could be lost if construction/development of the land did not go forward within a time period, 40 years is what I was told.

So is there this pressure on landholders to develop the land or loose it?

Are some landowners reluctant to build at this time but being coerced into it by land policy?

[anto]

If the Russians start coming to Chiang Mai in numbers like they go to Pattaya ,then there will be a huge shortage of Condos in Chiang Mai .

Chiang Mai as Thailands second City is still quite small and has a long way to grow .

Are you talking about Russians coming in hordes and renting condos?

Renting but also buying in big numbers.

[IsaanUSA]

I think we can expect more international flights, more investment, more companies moving up here, and with the AEC round the corner, plus Burma opening up, things will go much faster than you think, so I rest my 'heavy' case!

Do you think "Burma opening up" will really have much of an impact on Chiang Mai? I can't imagine CM has much to gain from that.

I do think that somebody is doing a good job with the flight options, but it could still be expanded more in the region. How about a Star Alliance flight from Korea or Japan?

[elektrified]

If the Russians start coming to Chiang Mai in numbers like they go to Pattaya ,then there will be a huge shortage of Condos in Chiang Mai .

Chiang Mai as Thailands second City is still quite small and has a long way to grow .

Are you talking about Russians coming in hordes and renting condos?

Renting but also buying in big numbers.

I disagree with that assessment. Having lived among Russians in Eastern Europe and meeting many of them on a trip to Phuket last year, they are not the type that would buy anything away from their homeland - maybe a very small percentage. They mostly come on vacation then return home, some never come back to Thailand. And they like the beaches. I could see that happening with the Chinese ----- possibly.

[JomtienEats]

Thank you sir, that you seem to concur with my Chinese assessment.

But why are people talking about Russian Hordes? It is definitely true that I would prefer the Chinese moving in. But if it must be Russians, then I just hope it is the children of White Russians.

By the way, do you have any timeline for a possible major crisis in China?

No, I just know the Russians like beaches when they go on holiday. That's why I like Chiang Mai. There are no . . . . . . beaches.

[Pinot]

Saturated or not? Who cares? Never buy anything in Thailand. There is no reason to. Plenty of places to rent, at a cost you can't justify a purchase. It's that simple. Don't buy anything in Thailand.

[anto]

If the Russians start coming to Chiang Mai in numbers like they go to Pattaya ,then there will be a huge shortage of Condos in Chiang Mai .

Chiang Mai as Thailands second City is still quite small and has a long way to grow .

Are you talking about Russians coming in hordes and renting condos?

Renting but also buying in big numbers.

I disagree with that assessment. Having lived among Russians in Eastern Europe and meeting many of them on a trip to Phuket last year, they are not the type that would buy anything away from their homeland - maybe a very small percentage. They mostly come on vacation then return home, some never come back to Thailand. And they like the beaches. I could see that happening with the Chinese ----- possibly.

The Russians are buying up Condos in vast numbers in Jomtien next to Pattaya .They seem to like to stay togeather in the same area .Jomtien is now a vast building site of new Condo construction .The Condo down there i sold to a russian ,was in a complex of 650 units .At least 25% sold to Russians .

I hope people are right that the Russians will not come to Chiang Mai in mass ,but when i first lived in Jomtien 8 years ago there were no Russians now its like little Russia .

[OldChinaHam]

"I hope people are right that the Russians will not come to Chiang Mai in mass ,but when i first lived in Jomtien 8 years ago there were no Russians now its like little Russia ."

I am hoping for, like, Little China.

So to my friends in China and Taiwan.....

Buy Baby Buy!

In Chiang Mai!

[Thailand]

Saturated or not? Who cares? Never buy anything in Thailand. There is no reason to. Plenty of places to rent, at a cost you can't justify a purchase. It's that simple. Don't buy anything in Thailand.

You must be starving!

[elektrified]

I disagree with that assessment. Having lived among Russians in Eastern Europe and meeting many of them on a trip to Phuket last year, they are not the type that would buy anything away from their homeland - maybe a very small percentage. They mostly come on vacation then return home, some never come back to Thailand. And they like the beaches. I could see that happening with the Chinese ----- possibly.

The Russians are buying up Condos in vast numbers in Jomtien next to Pattaya .They seem to like to stay togeather in the same area .Jomtien is now a vast building site of new Condo construction .The Condo down there i sold to a russian ,was in a complex of 650 units .At least 25% sold to Russians .

I hope people are right that the Russians will not come to Chiang Mai in mass ,but when i first lived in Jomtien 8 years ago there were no Russians now its like little Russia .

Point well taken. I don't don't know Jomtien or Pattaya so I trust your assessment of the situation down there. I don't think they will come to C.M. in large numbers though; whether on holiday or to buy. It's not their scene. If they want the mountains they will go to Karlovy Vary, Czech Republic. In fact 30% of the population is Russian. They like Thailand for the beaches.

[heybruce]

Saturated or not? Who cares? Never buy anything in Thailand. There is no reason to. Plenty of places to rent, at a cost you can't justify a purchase. It's that simple. Don't buy anything in Thailand.

You must be starving!

Starving? No. I agree with Pinot for three reasons:

1. There are plenty of reasonably priced rental options in Chiang Mai, and with all the building, arguably overbuilding, going on, I don't expect that to change.

2. Even if I find a condo I like at a price I consider reasonable, as rapidly as Chiang Mai is changing there is a good chance I will no longer like the location in a few years. If I rent that is an easy problem to solve.

3. I don't consider condos in Chiang Mai, or real estate in Thailand, to be a good investment. Maybe prices will shoot through the ceiling, or maybe they will crash through the floor. The level of uncertainty, and my pessimism about long-term condo prices and property rights for foreigners in Thailand, is such that I'd reather invest elsewhere.

[Berkshire]

Do not worry - many people were asking similar questions in Bangkok in the early nineties, when cranes and construction sites were growing like mushrooms, everywhere you looked.

Who will fill all these offices? Rent all these condos? Stay at all these hotels!

In my opinion, Chiang Mai will thrive, and so will the real estate market, but with the same market crises along the way.

It will not however be a very pleasant place to live.

Even now, it is growing into a bit of a horror story, but many people - including Chinese tourists - don't care about environmental considerations, or the quality of life, as long as material things are in abundance, so prepare for much, much more construction.

Even if there is a crash due to Thai politics, the world economy or warfare, Bangkok's history tells us things always eventually recover.

Life goes on as they say, and so unfortunately will 'development' - until maybe one day, Mother Earth strikes back.

Unfortunately, I think you're right. Chiang Mai will keep growing and growing population-wise, but the infrastructure will not keep up. Displaced Bangkonians fleeing flood-prone low lands and all manner of foreigners have been descending into CM non-stop. Someone told me years ago that CM had the potential to become like BKK and I didn't believe it then. I'm starting to believe it now. At least we have far-flung suburbs that are somewhat immune to over-development...well, not totally immune.

[mjsansai]

Lets be realistic Chiang Mai"s econony depends on Tourism and Agriculture, living in town is becoming unbearable, you can purchase a piece of land 1 rai for 400,000 baht, rent it for 30 years and put a house on it for 1,600,000 why would anyone want to live in the town when they could live in a semi-rural village 10 KM from town, and enjoy a bucolic life, I simply don't get why anyone would buy a condo, if your married to a Thai put the land in your children's name