Condo glut

[jbrain]

There are numerous large condo developments under way in Jomtien, but nothing like 50,000.

The oil spill in Rayong has no bearing on the Pattaya property market at all.

There's no decline in quality tourists because there were never many to start with.

As ThaiBob says, the end of the supposed property bubble here is predicted every few weeks and it never happens.

A couple of weeks back the bankok post had a pice about what is going on here. AD condo on second road alone will have 1200 units, dusit next to it 500 units opiste that aqua. let me find the link.

Than we have those 28 m2 5 building russian place down the road, the sphere, 45 floors coming up in front of jomtien beach paradise shall we go on? jomtien at the moment outranks nakuea by far. and they still haven't finished 2.nd road, so they cant build there.

The OP mentions "50,000 condo units being built in Jomtien alone'". That would be roughly forty 1,200 unit developments. Now if you include Pratumnak, Pattaya and Naklua, and all the developments that only exist on paper you might get 50,000. But not 50,000 being built in Jomtien alone. i would have noticed.

But you're right about Jomtien being a hot spot for building right now.

Only those Laguna projects together present already an enormous amount of unit, but you don't notice them because they haven't started yet however they have been promoted for well over 3 years now, and might never get started also.

Edited August 20, 2013 by jbrain

[JakeBKK]

There are numerous large condo developments under way in Jomtien, but nothing like 50,000.

The oil spill in Rayong has no bearing on the Pattaya property market at all.

There's no decline in quality tourists because there were never many to start with.

As ThaiBob says, the end of the supposed property bubble here is predicted every few weeks and it never happens.

A couple of weeks back the bankok post had a pice about what is going on here. AD condo on second road alone will have 1200 units, dusit next to it 500 units opiste that aqua. let me find the link.

Than we have those 28 m2 5 building russian place down the road, the sphere, 45 floors coming up in front of jomtien beach paradise shall we go on? jomtien at the moment outranks nakuea by far. and they still haven't finished 2.nd road, so they cant build there.

The OP mentions "50,000 condo units being built in Jomtien alone'". That would be roughly forty 1,200 unit developments. Now if you include Pratumnak, Pattaya and Naklua, and all the developments that only exist on paper you might get 50,000. But not 50,000 being built in Jomtien alone. i would have noticed.

But you're right about Jomtien being a hot spot for building right now.

Only those Laguna projects together present already an enormous amount of unit, but you don't notice them because they haven't started yet however they have been promoted for well over 3 years now, and might never get started also.

Why in Buddha's name someone would move next to a waterfall and a large pool with screaming kids? It probably looks very cool on the plan you buy it from. If you have to spend the rest of your pension next to it, not so much i guess

[KittenKong]

You'll notice in these threads that the HATE CONDOS and FOOLS BUY REAL ESTATE brigades are of course composed of mere renters. You'd think of the thousands of condo owners, many would jump in and agree, "dam_n, I should never have bought that condo!" But no. In fact, most owners are reasonably satisfied w/ their purchases.

Most, perhaps, but by no means all. It isn't easy for most people to admit that they have made a mistake, but some do manage it.

It is even more difficult (not to mention potentially counter-productive) to admit this if you are still trying to sell your millstone on.

[JSixpack]

You'll notice in these threads that the HATE CONDOS and FOOLS BUY REAL ESTATE brigades are of course composed of mere renters. You'd think of the thousands of condo owners, many would jump in and agree, "dam_n, I should never have bought that condo!" But no. In fact, most owners are reasonably satisfied w/ their purchases.

Most, perhaps, but by no means all. It isn't easy for most people to admit that they have made a mistake, but some do manage it.

It is even more difficult (not to mention potentially counter-productive) to admit this if you are still trying to sell your millstone on.

Or, far more likely it's just that it isn't easy for most people to admit they don't have much money, have only a crappy visa, and are pussies besides. Far easier just to spew out sour grapes--makes one feel so much better.

It is even more difficult (not to mention potentially counter-productive) to admit this if you are are looking to buy a house/condo. You'd want to talk prices down as much as possible. Many FOOLS BUY REAL ESTATE posts here are simply dreams and wishes for cheaper prices--prices the renter could easily afford, i. e., something for nothing. Cheap Charlies abound here.

Actually, if a property does have a major problem, owners do tend to speak up. Examples: Jomtien Complex, when VT went up in front; Centre Condo, about noise and ashes from the Wat; water shortages on Siam CC, etc. Eventually the problems find solutions, sometimes by an attitude adjustment combined with a little property modification.

Nor do we have many ex-owners, having sold the "millstone," proclaiming their relief. Why not? I'm happy to proclaim my relief I sold my big motorbike!

Again, we have a mere renter purporting to speak for owners, now because the owners can't speak for themselves. Yeah, right.

I think my point stands.

Edited August 20, 2013 by JSixpack

[manarak]

For newbies like me, can someone inform us as to what in the h_ll is a farang named condo? /is it "Billy Bob's Not as secure as you thought" developments?

As a farang in Thailand, the law doesn't allow you to own a house or land. You can only lease or rent. However there is an exception for condo blocks. In some condo developments farangs are allowed to own units in their own name (farang name condo), as long as more than 50% of the units in the building are owned by Thais. Thus the building and land are jointly owned by the Thai and farang owners. Each owner has a deed (chanote) showing his ownership.

However, never forget that the law in Thailand is not really on your side if you run into problems with a Thai national or government entity. Plenty of farangs have found this out the hard way.

well, the first line of you explanation already contains a crass factual error, namely that foreigners can't own houses. This is plain wrong, foreigners can own buildings.

I would have expected more knowledge from someone who has been "involved with it for years"...

Anyway, back to the topic... I think the continued condo building is not a bad thing, because it will keep condo prices down, and new areas will get developed, instead of running out of space and propping prices up sky high.

[sfokevin]

Another thing you never, ever hear from a condo owner is "my (ex-)wife and her relatives kicked me out of my condo and I lost X million baht."

No you usually hear of them falling from their balconies

Edited August 20, 2013 by sfokevin

[IsaanUSA]

http://my.knightfrank.com/research-reports/pattaya-condominium-market-overview.aspx

The condominium market in Pattaya remained relatively strong over the last six months,
following the solid performance of the previous year. The additional supply was around 10,153
units, making up a total supply of 40,939 units as of H1 2013. The take-up rate in all locations
increased to 51.7% from 50.3% in the second half of last year. The average selling price of
high-rise units was particularly higher than those in a low-rise building; this is because
high-rise buildings boast sea view premiums. The Pratumnak area recorded the highest
average selling price during 1H 2013 at around THB 96,286 per square metre. Among other
locations, new low-rise projects in Jomtien commanded the highest prices due to their good
facilities and amenities, such as a large resort theme.

EDIT : Bolded important parts

Edited August 20, 2013 by IsaanUSA

[KittenKong]

Actually, if a property does have a major problem, owners do tend to speak up. Examples: Jomtien Complex, when VT went up in front; Centre Condo, about noise and ashes from the Wat; water shortages on Siam CC, etc. Eventually the problems find solutions, sometimes by an attitude adjustment combined with a little property modification.

I was going to mention Jomtien Complex as an excellent example. There must be 500 people in there who every day wake up and rue the day they ever thought about buying their condo. I have met quite a few of them, and whilst they are showing you their units (with panoramic view of VT7) they usually try to appear happy.

The same applies to sellers I have come across in VT5C (views also blighted by VT7), Chateau Dale (blighted by Grande Caribbean), Metro (termites and the Lumpini condo), buildings with legal or management problems like La Royale, not to mention the endless problems on Pratumnak where every day a new building site goes up in front of an older building which until then had enjoyed a nice view and pleasant location. And you're trying to tell me that all these people are happy with their purchases? Pull the other one.

And I dont quite see how an "attitude adjustment" or a "little property modification" will help any of them, unless it involves copious amounts of dynamite.

And what about the untold thousands of people who have bought off-plan units as "an investment" and who now must be wondering about how they are ever going to sell them on? I know a couple of so-called real estate agents who have bought such units themselves with a view to "flipping" them, and even they cant manage to shift them, even though they own their own agencies and so can promote their units endlessly.

I know quite a few people who have sold condos here and are glad to be rid of them. They now rent even though, like me, they have more than enough money to buy several condos if they wished.

It is a big mistake to assume that all people rent because they cant afford to do otherwise. I rent and I wear tshirts from Primark that cost me under 100B, but my new car down in the car park is worth more than many of the smaller condo units nearby.

And the main reasons I rent are because I doubt that I will be here long enough to amortise purchase/sale costs, because I value my freedom to change building or room at a moment's notice, and simply because it just doesn't make any economic sense at all to buy at some absurdly over-inflated price when I can rent the same unit for barely 4% of that price and let my landlord take care of the fees and repair costs and all the other potential downsides.

YMMV

[KittenKong]

The take-up rate in all locations

increased to 51.7% from 50.3% in the second half of last year.

Hmm. I was involved with the IT for a property developer in Europe a few years back when I was still working. Their holiday apartment projects were always 100% sold long before construction was anywhere near finished, and often before it was begun. A 50% sales rate would have been considered an abject failure.

[thaimat]

It is amazing to me, how some people go ballistic if you mention the mere possibility of the real estate market levelling out. When someone is pushing the idea that real estate is always going to go up, you can easily guess what their business is. As is usually true in the rest of the world as well, when someone doesn't want a discussion of a topic, they are quite scared of the truth getting out.

Doing a Google search for new condo construction only, no homes, I found one online condo agency stating " We list over 250 condominium projects with all new condo developments, off plan developments and condos under construction, all in Pattaya or Jomtien", a Remax site that has construction updates on 50+ high rise condo developements that are under construction now. So unless someone has some verifiable numbers of how many new condos are under construction now, suffice to say it is clearly a very, very large number. A large quanitity of new condos hitting the market at the same time will probably affect the prices, simple logic withstanding, don't you think?

There are always people that pay crazy money for things here, mostly first time investors in LOS I would guess. A Thai lady friend just bought 3 studio condos, empty shells, for almost 9 million Baht, (her new-to-Thailnd BF's money). Her plan is to rent them out, to make money. After (apply your own adjective here) sinking another million into each, I tried to help her with the math, after she asked me how much to charge for rent and when she'd make her investment back. She was shocked at how long it will take her, literally would not believe the numbers. I wonder how many condo buyers here experience that same rude awakening?

[JSixpack]

And you're trying to tell me that all these people are happy with their purchases? Pull the other one.

What I told you is in plain black-and-white above, pal. Most owners are reasonably satisfied w/ their purchases. And you've already conceded that point.

And I dont quite see how an "attitude adjustment" or a "little property modification" will help any of them, unless it involves copious amounts of dynamite.

Oh, I do. They simply get used the fact that, for example, they don't need that view they used to have and remind themselves that they still paid quite little compared to what they'd have paid in, say, Miami. They still have the advantages of ownership that outweigh renting. Life goes on; it's not the disaster you'd love it to be, you see--sorry.

And what about the untold thousands of people who have bought off-plan units as "an investment" and who now must be wondering about how they are ever going to sell them on? I know a couple of so-called real estate agents who have bought such units themselves with a view to "flipping" them, and even they cant manage to shift them, even though they own their own agencies and so can promote their units endlessly.

A whole different category. Gambling and speculation carry high risks that the gambler had better be prepared to assume. "Untold thousands?"

I know quite a few people who have sold condos here and are glad to be rid of them. They now rent even though, like me, they have more than enough money to buy several condos if they wished.

. . .

YMMV

It does. I've rented, lived out of suitcases, and I've owned. I like owning much, much better. Some people, now, are temperamentally unsuited for owning here, true. I've said somewhere that if you're a fussy old lady, you'd be a lot better off living in Sarasota, Fla. Much less to nitpick and complain about. But then again, so many live for complaining and prophesying doom, eh. Voices of TRUTH in the wilderness--our noisy HATE CONDOS and FOOLS BUY REAL ESTATE brigades. Maybe that's mainly why they stay in Thailand and hang out on TV.

[rayongchelsea]

However, never forget that the law in Thailand is not really on your side if you run into problems with a Thai national or government entity. Plenty of farangs have found this out the hard way.

Stir the pot, stir the pot. Plenty of farangs have been treated w/ complete fairness by the courts and plenty of Thais have found this out the hard way. I was once involved in just such a case. The law, police, and the courts aren't "against farang." In many cases, the Thai national or government entity may be acting in accordance w/ the law and the farang not. Why should the courts exonerate some criminal farang because he's a farang? Nor is ignorance of the law any excuse.

Yawn. Looks to me that you don't have any credibility here and are mainly trolling. I ain't scared.

Couldn't agree more.

I am doing exactly the same, told not too..been intimidated and yet the courts are trying to " impose" the rules on a very influential developer.

The law maybe bias but it is still the law. I hate this roll over and take it up the butt brigade..what are they doing here!! we have rights as owners just like Thais..

Better to have tried than just except a " diminished" self..

Most lost because of ex girlfriends etc..and tried to circumvent the law. I was told in 1987 that nominee companies were illegal and at that time wives of foreigners couldn't own any land!!

Lost a couple of good deals late 90's as wouldn't risk it, but those that did at the time may have done well.its a risk, just a calculated one.

I just don't see where the re- sale market is with these companies.

There is a developing resale market, my condo is proving increasingly popular with re- sales.

[KittenKong]

And I dont quite see how an "attitude adjustment" or a "little property modification" will help any of them, unless it involves copious amounts of dynamite.

Oh, I do. They simply get used the fact that, for example, they don't need that view they used to have and remind themselves that they still paid quite little compared to what they'd have paid in, say, Miami. They still have the advantages of ownership that outweigh renting. Life goes on; it's not the disaster you'd love it to be, you see--sorry.

Putting up with crap just isn't good enough for me, I'm afraid. All my life I have lived in decent houses (and latterly condos) with nice views. I would never consider living anywhere that doesn't have a nice view. Having bought or rented a place with a nice view I could not contemplate living there if the nice view disappeared, and I would have to move somewhere else that did have a nice view. The same would apply if something noisy happened nearby, be it a building site or boom-boom trucks on the road outside, or barking dogs or noisy neighbours. I would be gone like a shot.

So here I would much rather rent and keep my freedom to move quickly and cheaply if for some reason something untoward happens with the place I am in. We all know that happens often enough here.

Those who are prepared to put up with a second-rate place simply because they own it are welcome to their mediocrity, but it's not for me. I did live in a lovely house that I owned in Europe for over 20 years, but when nearby development started to change the peaceful surroundings I didn't hesitate to leave, even though they could not spoil the view. Luckily that house was in a country with a sensible property market where things sell within a month or two of being advertised, and where prices have risen steadily for many decades, without any bubbles or crashes, and I sold the place for 4 times what I paid for it in local money. The same cannot be said of property here, of course.

As for the monetary value issue, I suggest you ask the owners in Jomtien Complex or some of the other buildings I mentioned what they think about having paid a hefty premium for a nice view/location and then finding that it has been taken away from them leaving them with a unit that may be worth much less than it was previously. I doubt that they share your equanimity.

[i claudius]

Just A thought ,but i have a friend who has run a succesfull agency here in Pattaya for many years -----he rents. wonder why? he has owned a couple of condos in the past and sold both

[Spalpeen]

For newbies like me, can someone inform us as to what in the h_ll is a farang named condo? /is it "Billy Bob's Not as secure as you thought" developments?

As a farang in Thailand, the law doesn't allow you to own a house or land. You can only lease or rent. However there is an exception for condo blocks. In some condo developments farangs are allowed to own units in their own name (farang name condo), as long as more than 50% of the units in the building are owned by Thais. Thus the building and land are jointly owned by the Thai and farang owners. Each owner has a deed (chanote) showing his ownership.

However, never forget that the law in Thailand is not really on your side if you run into problems with a Thai national or government entity. Plenty of farangs have found this out the hard way.

well, the first line of you explanation already contains a crass factual error, namely that foreigners can't own houses. This is plain wrong, foreigners can own buildings.

I would have expected more knowledge from someone who has been "involved with it for years"...

Anyway, back to the topic... I think the continued condo building is not a bad thing, because it will keep condo prices down, and new areas will get developed, instead of running out of space and propping prices up sky high.

I'm well aware of that, but unless your house has wheels it's not of much practical use. I was replying to a 'newbie' who asked for a brief description of the ownership rules here.

As for 'crass' (coarse, crude, not refined), I'd have thought that after 2,700 posts you would have learned to show more respect to other forum members.

[JSixpack]

It is a big mistake to assume that all people rent because they cant afford to do otherwise.

I don't assume anything about all people and stated no such assumption. I talk much less in extreme terms than yourself and avoid exaggeration; perhaps it's because I have no ax to grind and don't feel particularly emotional about this issue.

Putting up with crap just isn't good enough for me, I'm afraid.

But you're able to see things only from one point of view. The definition of crap, you see, is a lot more flexible than you're able to grasp.

I'll give you the contrary argument about Jomtien Complex that you, from a nanny state, won't like or agree with. Nevertheless, it's a rational argument perfectly valid from the the VT point of view.

The essence of the argument is that Jomtien Complex condo owners didn't own the land in front of their condo. There was no formal agreement with the owner of that land not to do whatever that owner wanted. If they had had such an agreement, they'd have had to pay a lot MORE for their condos for a guaranteed sea view. Thai law doesn't much recognize zoning laws. Obviously--long ago, Saranchol was built just beside Sky Beach and messed up a lot of views. So JC owners had NO guarantee and they knew it--or should have known. You don't buy in a Third World country w/ doing your due diligence.

So, why should the owner of the land in front lose money for the sake of JC owners by not maximizing his own profit? If YOU had owned that land, how would you like it if JC owners' interests would lose you a lot of money? You wouldn't: it would be crap!

And all those owners of VT who would gain condos with sea views--and were willing to pay a greater premium for them--why should they give up the opportunity to own and enjoy them for sake of JC owners? If they thought they really should, then VT would have sold no units. In fact, VT wouldn't even have built the condo for fear of no buyers.

But the rest is history, eh.

I did live in a lovely house that I owned in Europe for over 20 years, but when nearby development started to change the peaceful surroundings I didn't hesitate to leave, even though they could not spoil the view.

Spoiling the view, or perhaps changing the peaceful surroundings, would decrease your property value, so of course you'd be against them and you would forcibly (by law) restrict the owner of the nearby land from fully developing his property--so costing him money.

But your position is actually inconsistent. Suppose you were the owner of that land and had a chance to make a good profit. Or suppose the developer enhanced the peaceful surroundings and upgraded the area so that your property, by chance, greatly increased in value? Now that, you see, would be just fine! Now, when you sold your property, shouldn't you share your profits with that developer? Shouldn't it be legally required of you even if you had made no formal agreement? No, you don't think it should.

Ultimately, your viewpoint is selfish, so why shouldn't the developer--and the developer's customers--be selfish as well?

As for the monetary value issue, I suggest you ask the owners in Jomtien Complex or some of the other buildings I mentioned what they think about having paid a hefty premium for a nice view/location and then finding that it has been taken away from them leaving them with a unit that may be worth much less than it was previously. I doubt that they share your equanimity.

Well, they paid some premium for a non-guaranteed view. It was good while it lasted. If they had wanted a guarantee, the premium would have been much greater, e.g., Northshore prices. I would assume nobody deceived them--but shysters can be found in every country, not just Thailand.

Of course they wouldn't be happy about losing the view--or some of the view--but I haven't heard of anybody jumping off his balcony. They've all quieted down now (it's the renters here such as yourself who continually complain about condos they don't even own! ) and they're getting on w/ their lives. So most of them are, in all likelihood, reasonably satisfied. If truly unhappy, they sold (perhaps at a loss, but in what currency?) and, since they can afford to be in the game, bought elsewhere, much the wiser.

You only know people who sold their condos and moved into rented rooms to join the HATE CONDOS brigade. But I know owners who found other condos they liked better and bought and moved into them. Or they bought houses, having married a Thai wife who insisted.

Or some of them just died of old age in their condos.

Edited August 21, 2013 by JSixpack

[rayongchelsea]

I would have to agree. Owning the house really isn't that much protection if things go wrong.

Anyway the value is in the land not in the house which is a depreciating asset.

[KittenKong]

I'll give you the contrary argument about Jomtien Complex that you, from a nanny state, won't like or agree with. Nevertheless, it's a rational argument perfectly valid from the the VT point of view.

The essence of the argument is that Jomtien Complex condo owners didn't own the land in front of their condo. There was no formal agreement with the owner of that land not to do whatever that owner wanted. .......

You make so many errors in your assumptions about how I think that it is hard to know where to begin in correcting them.

I couldnt care less about who pays what, or who owns which building land. Nor do I care about what other people do or dont do. I simply do not want to live somewhere I dont like, at any price. Problems with property can arise here for all sorts of reasons, even in the most expensive buildings, and I would rather not be locked into owning a place that may be hard to get rid off if the wind changes. So I rent. Many other people do the same, I'm sure.

Spoiling the view, or perhaps changing the peaceful surroundings, would decrease your property value, so of course you'd be against them and you would forcibly (by law) restrict the owner of the nearby land from fully developing his property--so costing him money.

Again, you assume that I care about the value of where I live more than the pleasure I get from living there. I do not. I moved because to my mind the place wasnt as nice as it used to be, that's all.

But your position is actually inconsistent. Suppose you were the owner of that land and had a chance to make a good profit. Or suppose the developer enhanced the peaceful surroundings and upgraded the area so that your property, by chance, greatly increased in value? Now that, you see, would be just fine! Now, when you sold your property, shouldn't you share your profits with that developer? Shouldn't it be legally required of you even if you had made no formal agreement? No, you don't think it should.

Again, you make totally erroneous assumptions about things of which you have zero knowledge. There was no "developer". I lived a km or so outside a little village on 2 hectares of land that belonged to me. Over the 20+ years I was there the village went from 1000 inhabitants to 5000, and I didn't like it. So I sold the house and the land (which was not building land and never will be). It was easy to sell and I got 4 times the price I paid for it, because it was a very nice house in a very desirable location with a stunning view that could never be lost. But it just was not a location that was good enough for me any more.

I have no problems with this. But I do have problems with buying something in a country in which I have to ask for permission to stay every year, and that may be very hard to sell if the view or the surrounding area deteriorates, such as can happen with a condo here, or indeed if the political/visa situation changes as it could easily.

So I dont do it. I'm certain that many other people dont do it for exactly the same reasons. And I'm sure that many others dont care about such things.

You only know people who sold their condos and moved into rented rooms to join the HATE CONDOS brigade. But I know owners who found other condos they liked better and bought and moved into them. Or they bought houses, having married a Thai wife who insisted.

Again, you make totally erroneous assumptions about who I know and who I dont know.

I know people who own one property here that they like. I know people who own one property that they dont like but cant sell (without taking a big loss). I know people who have never owned here and dont want to, and I also know people who used to own and dont any more. I also know people who currently rent but are looking to buy. I know people who would like to buy but cant because they have no money. I also know several people who own many condos each. Some are happy, some are not, and some appear to be worrying themselves into an early grave.

They all have their own reasons for doing what they do (and none of it is any of my business or my concern) but to assume as you do that all the owners are delighted with what they own, and that anyone who rents is merely a pauper suffering from a dose of sour grapes is just plain nonsense.