Bangkok condo prices jump 21 percent

[webfact]

Bangkok condo prices jump 21 percent
By Coconuts Bangkok



BANGKOK: -- Average prices for new condominium projects in Bangkok rose a staggering 21 percent quarter-on-quarter according to the latest research published by Colliers International Thailand.

In its Bangkok Condominium Market Report covering the first half of 2013, Colliers revealed that the number of new launches dropped by 22 percent compared to the previous quarter, but the number for the entire first six months was 12 percent higher compared to the same period in 2012.

Low- and middle-income buyers with budgets under THB3 million remained the highest proportion of property buyers in the Thai capital, according to the report.

The average take-up rate for new condominium projects in Bangkok during the second quarter was 74 percent – the highest recorded for a number of quarters due to strong sales at projects being sold by reputable, listed developers and located close to the city’s mass transit network.

Average selling prices in the city area were recorded at THB166,000 per sqm – the highest for more than two years and 2.7 percent up on the previous three-month period. Prices in the city are more than 100 percent higher than average prices for the entire Bangkok metropolitan region.

The research also noted a price drop once a project is more than 200 metres from one of the city’s mass transit stations, and declines substantially once that distance is more than 1,000 metres. [read more...]

Full story: http://bangkok.coconuts.co/2013/08/27/bangkok-condo-prices-jump-21-percent


-- Coconuts Bangkok 2013-08-27

[theblether]

Staggering indeed, great news if you are in the chain already, a disaster otherwise.

I can't think of seeing that quarterly rise anywhere before, in any country, ever.

I hope people are strong enough to survive the inevitable crash, figures like this only encourage more lemmings into the market.

[4evermaat]

I agree blether....a bubble waiting to happen. Buy the rumors, sell the news?

"...the 2nd best time to plant a tree is today." Sent from ThaiVisa app (Galaxy Note 2).

[planr]

It's a fancy statistic that Coconuts has chosen to latch onto to create a sensational headline in order to drive traffic. In reality, if you read the report, it is less impressive and if you drill down, it almost seems like a typo in the Collier's report if you look at the other data they present...

[isawasnake]

I have owned for about a year, and would love to believe it, but don't. It is written by a guy who gets a paycheck from DD Property.

I think the only way buying here really makes sense is if you have long term plans to hold and use it as your place, or to hold and rent it out.

Edited August 27, 2013 by isawasnake

[lee b]

jump yeah of course

[waza]

The research also noted a price drop once a project is more than 200 metres from one of the city’s mass transit stations, and declines substantially once that distance is more than 1,000 metres........ In addition, many foreigners are back in the Bangkok condominium market again and most of them are looking for luxury condominium units in the City area around the BTS stations; foreign buyers will continue to increase in number in the future."

So the price is up for farrang condos but down for Thai ones.

[dcutman]

The big question is....... witch of the 140,000 empty/unsold do you want to buy with the increase price? Or maybe look at the 70,000+ empty /unsold in the surrounding area. Of course this does not include the hundreds coming available every day,

[Farma]

I once worked with a guy studying for his auctioneers licence.

One module required him to write a jazzed up news article putting a positive spin on a depressed market.

This news report looks like it would fulfill that modules requirements to a T.

[SantiSuk]

If condo prices are so buoyant why is my 18 month old block on Sukhumvit clearly only half sold with the other half now rented out under Plan B on various short medium lets to language schools, Japanese package tour groups, Chinese music students and the like.

Never trust a survey on prices by a property market insider. Unfortunately only property market insiders are interested enough to do surveys.

[mrdome]

Soon, the price increase will be synchronized to the rate in which the ground subsides... Bangkok, the future Venice of SE Asia.

[eddie61]

shades of 1996......

[Thaddeus]

Not selling enough, put the price up.

[Suradit69]

Not selling enough, put the price up.

Probably better than" Not selling enough, let's give everyone 110% mortgages with nothing down even though they're employed at minimum wage and then we'll package those dead-money mortgages, label them AAA and sell them to clueless investors." That's been a popular approach to real estate "development" in the west that certainly worked well.

It's a common perception that if you have something that's not selling, you should lower the price and take a loss now. Asian sellers tend to hold onto assets and wait for the market to rise to their price, even raise the price further.

In one case you take a loss immediately, which may be smart if your tax structure rewards you for taking losses or you're using other people's money. In Thailand or elsewhere in Asia, not selling means you're (maybe) having an opportunity loss because your money isn't immediately available to invest in something else, but then in a down market there may not be much else worth investing in.

I know westerners think their economic wisdom is greater than that of Asians, but the western track record in selling and financing real estate recently would suggest otherwise.

[BlackJack]

probably a knock on effect of the 300baht per day salary increase

some numbers

41% foreign owned

51% thai owned

developer usually holds on to 10%

50% building empty

whos buying

whos speculating

whos flipping

I simply cant believe the medium price range is 166K baht

[smokinfun]

I've been in same apartment for 9 years overlooking Sukhumvit - and there were 27 new high rise developments; and either these people don't use electricity or (easily) more than 50% are empty. There is bubble coming..... But one never knows until it's here.

[Billy The Kid]

Bought a condo in Pattaya for 1.75 m in 2005, today i guess i get the same Valuation as before but maybe little less.

[kingalfred]

So can I buy a used condo in bkk not more than 500 mtrs from mass transit for 2-2.5 million?

[SantiSuk]

So can I buy a used condo in bkk not more than 500 mtrs from mass transit for 2-2.5 million?

If you could put up with 35-40sqm one bed you could probably trawl the new condos on soi On Nut (that's Sukhumvit soi 77) from Sukhumvit junction outwards and along Sukhumvit from Prakanong outwards and pitch a price at them for a new unsold unit. I reckon some of these builder/developers that are now advertising their units for let (some are advertising resales - I would guess on behalf of early investors) are $hitting cobs having to play the landlord and pay the banks their financing.

Anything on Suk is not going to be more than a click from BTS. Mine is half a click and others are popping up between me and the station. I'm at Diamond Sukhumvit opposite the soi77/Suk junction on Suk. Nice enough block. Paid 4.5 for a 70sqm 2 bed 2 years ago - I think those are still the same price. I'd go prodding prices downstairs for you for the smaller ones if I wasn't in the UK for a couple of weeks.

Heresay has it that second hand apartments go at substantial discounts to new, but who cares if you are buying for the long term and you have got reasons to ignore the very sensible advice that renting is far better value in Thailand. Cast your net wide, bargain hard and don't be scared to misplaced arrogance a few times.

[Dork]

So can I buy a used condo in bkk not more than 500 mtrs from mass transit for 2-2.5 million?

Yes, along the purple line (completion late 2015) that would be manageable. Even a fairly good sized 2br unit.

[Thaddeus]

Not selling enough, put the price up.

Probably better than" Not selling enough, let's give everyone 110% mortgages with nothing down even though they're employed at minimum wage and then we'll package those dead-money mortgages, label them AAA and sell them to clueless investors." That's been a popular approach to real estate "development" in the west that certainly worked well.

It's a common perception that if you have something that's not selling, you should lower the price and take a loss now. Asian sellers tend to hold onto assets and wait for the market to rise to their price, even raise the price further.

In one case you take a loss immediately, which may be smart if your tax structure rewards you for taking losses or you're using other people's money. In Thailand or elsewhere in Asia, not selling means you're (maybe) having an opportunity loss because your money isn't immediately available to invest in something else, but then in a down market there may not be much else worth investing in.

I know westerners think their economic wisdom is greater than that of Asians, but the western track record in selling and financing real estate recently would suggest otherwise.

When the day comes that you can prove that 99% of nothing is larger than 1% of something.... get back to me ....'k.

[stoli]

I was a Realtor in the US in the 2000's, and watched this unfold in 2008. Same exact scenario. Have to believe that Thailand is getting closer to the bubble bursting, especially in Pattaya. They have led most of the sheep that could be sheared to the pen. They will run out of sheep. The buyers will slowly come back after the 40% drop in prices, but it won't be pretty.

[lomatopo]

So can I buy a used condo in bkk not more than 500 mtrs from mass transit for 2-2.5 million?

What type of property are you looking for? No. of BR? Sq. M.?

Assuming you are familiar with the areas served by the BTS and MRT, you could scan local forums like prakard to get a feel for what's out there.

http://www.prakard.com/default.aspx?g=topics&f=417

[A1Str8]

Bangkok condo prices jump 21 percent

By Coconuts Bangkok

BANGKOK: -- Average prices for new condominium projects in Bangkok rose a staggering 21 percent quarter-on-quarter according to the latest research published by Colliers International Thailand.

In its Bangkok Condominium Market Report covering the first half of 2013, Colliers revealed that the number of new launches dropped by 22 percent compared to the previous quarter, but the number for the entire first six months was 12 percent higher compared to the same period in 2012.

Low- and middle-income buyers with budgets under THB3 million remained the highest proportion of property buyers in the Thai capital, according to the report.

The average take-up rate for new condominium projects in Bangkok during the second quarter was 74 percent – the highest recorded for a number of quarters due to strong sales at projects being sold by reputable, listed developers and located close to the city’s mass transit network.

Average selling prices in the city area were recorded at THB166,000 per sqm – the highest for more than two years and 2.7 percent up on the previous three-month period. Prices in the city are more than 100 percent higher than average prices for the entire Bangkok metropolitan region.

The research also noted a price drop once a project is more than 200 metres from one of the city’s mass transit stations, and declines substantially once that distance is more than 1,000 metres. [read more...]

Full story: http://bangkok.coconuts.co/2013/08/27/bangkok-condo-prices-jump-21-percent

-- Coconuts Bangkok 2013-08-27

Of course prices rose. That's what is going to happen in the future. It's going to rise over and over again because that's what takes place in developing countries with an economy that keeps getting stronger.

Sent from one of my devices using the internet

[NeverSure]

Not selling enough, put the price up.

Probably better than" Not selling enough, let's give everyone 110% mortgages with nothing down even though they're employed at minimum wage and then we'll package those dead-money mortgages, label them AAA and sell them to clueless investors." That's been a popular approach to real estate "development" in the west that certainly worked well.

It's a common perception that if you have something that's not selling, you should lower the price and take a loss now. Asian sellers tend to hold onto assets and wait for the market to rise to their price, even raise the price further.

In one case you take a loss immediately, which may be smart if your tax structure rewards you for taking losses or you're using other people's money. In Thailand or elsewhere in Asia, not selling means you're (maybe) having an opportunity loss because your money isn't immediately available to invest in something else, but then in a down market there may not be much else worth investing in.

I know westerners think their economic wisdom is greater than that of Asians, but the western track record in selling and financing real estate recently would suggest otherwise.

It ain't over yet. Get back to me in 5 years, and probably less.

[kingalfred]

So can I buy a used condo in bkk not more than 500 mtrs from mass transit for 2-2.5 million?

If you could put up with 35-40sqm one bed you could probably trawl the new condos on soi On Nut (that's Sukhumvit soi 77) from Sukhumvit junction outwards and along Sukhumvit from Prakanong outwards and pitch a price at them for a new unsold unit. I reckon some of these builder/developers that are now advertising their units for let (some are advertising resales - I would guess on behalf of early investors) are $hitting cobs having to play the landlord and pay the banks their financing.

Anything on Suk is not going to be more than a click from BTS. Mine is half a click and others are popping up between me and the station. I'm at Diamond Sukhumvit opposite the soi77/Suk junction on Suk. Nice enough block. Paid 4.5 for a 70sqm 2 bed 2 years ago - I think those are still the same price. I'd go prodding prices downstairs for you for the smaller ones if I wasn't in the UK for a couple of weeks.

Heresay has it that second hand apartments go at substantial discounts to new, but who cares if you are buying for the long term and you have got reasons to ignore the very sensible advice that renting is far better value in Thailand. Cast your net wide, bargain hard and don't be scared to misplaced arrogance a few times.

many thanks , what are the management/service charges like in most of the condos and what are the lease times?

[AlexRRR]

Accountant TGF tells me there is a glut of condos, she has lots of friends in banking and finance in BKK, shes no expert but shes been known to buy into a new development then onsell before completion and make a nice little tidy sum from time to time and she wasnt entertaining the idea when i rasied it recently.

[Nana Cowboy]

This is pretty staggering indeed but I dont believe a word of it. My old building had a vacancy rate of under 20% (no I didnt own but I did bail). The 1BRs started at 35K band in late 2008 and by 2010 you couldnt give them Awat for 18K. not even a lower ball offer. Oh and this was the prestigious bed supper club area. LOL. I got the bleep out of there rapid fire and my rent went to zero. how about that

[kingalfred]

This is pretty staggering indeed but I dont believe a word of it. My old building had a vacancy rate of under 20% (no I didnt own but I did bail). The 1BRs started at 35K band in late 2008 and by 2010 you couldnt give them Awat for 18K. not even a lower ball offer. Oh and this was the prestigious bed supper club area. LOL. I got the bleep out of there rapid fire and my rent went to zero. how about that

please explain the jargon

[kingalfred]

So can I buy a used condo in bkk not more than 500 mtrs from mass transit for 2-2.5 million?

What type of property are you looking for? No. of BR? Sq. M.?

Assuming you are familiar with the areas served by the BTS and MRT, you could scan local forums like prakard to get a feel for what's out there.

http://www.prakard.com/default.aspx?g=topics&f=417

thanks. What is BR ? And can you give me some info about buying such as contracts , lease times .visa requirement(if any) management fees , thanks