How can they keep building new buildings and apartments?

[johnthompson]

How is it possible that they can keep on building new apartments non stop, 7 days per week, for decades. The noise of construction work just does not stop. Doesn't the market get saturated at one point. And is it still profitable. I mean the population can only grow so fast and it seems to me that new places to live are growing faster than the population.

And where does the money to come from anyway? I don't think Thailand is a particularly rich country.

[Nana Cowboy]

Normally the do it with steel and cement posts and flooring

[Sharp]

Normally the do it with steel and cement posts and flooring

Wwwoooaaahhhhh

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[MJP]

Birth rate's 1.6. Population will soon be in decline.

I have to agree with Nana Cowboy though.

[David48]

Birth rate's 1.6. Population will soon be in decline.

I have to agree with Nana Cowboy though.

Agreed (I just checked your figures) ... but I don't think it's the whole picture.

What about the Urbanisation of the traditionally Rural population?

[krisb]

Thailand's got nothing on China when it comes to endless high rise construction. Not even close. I know the op isn't about China, but it brings a comparison. Then keep in mind the tradesman building these, millions of workers are kept in a job earning money, in turn they're spending money supporting other local businesses ie material suppliers and manufacturers, which means their employees have a job, even down to being able to buy food at the supermarket to feed their hungry families. The circles massive, it goes down the line. How can they keep building you say...

Keep building I say!

[krisb]

1 more thing, there isn't really a bubble to burst. From a developers pov, they have built equity. Eventually it will sell, in the mean time, the banks funding their next build.

[kevvy]

it is very profitable to build these villages or apartments.

[MJP]

Birth rate's 1.6. Population will soon be in decline.

I have to agree with Nana Cowboy though.

Agreed (I just checked your figures) ... but I don't think it's the whole picture.

What about the Urbanisation of the traditionally Rural population?

I think that's pretty much complete. There's no one in the countryside here. It's a big problem regards the supply of manual workers/farm hands.

Let's face it. It's another credit bubble.

[zydeco]

Normally the do it with steel and cement posts and flooring

Hah. Apparently you didn't see the recent story on the Thailand forum about the condos whose walls and windows were being built with crushed cardboard.

[Issangeorge]

In 1997 the economy blewup, because of overbuilding. shophouses and condos were going up everywhere, some in the middle of nowhere. The Thais were getting cheap money from overseas and using it to build these buildings. Many of them have never been used and are now falling down or have been torn down. The same thing is happening today. Cheap overseas money is being used to produce unneeded shophouses, short time hotels and condos. In my home town I think the shophouses have almost doubled in the last couple of years, most remain empty. What is going to happen when the US stops their stimulus program and there is no more cheap money? If you have Thai Baht I would consider moving it to another currency or gold. If you were thinking of bringing money to Thailand I would wait. I think the baht will be trading at 35-40 in a year. If you think I'm wrong I have a nice building lot for sale on Samui.

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[kannot]

In 1997 the economy blewup, because of overbuilding. shophouses and condos were going up everywhere, some in the middle of nowhere. The Thais were getting cheap money from overseas and using it to build these buildings. Many of them have never been used and are now falling down or have been torn down. The same thing is happening today. Cheap overseas money is being used to produce unneeded shophouses, short time hotels and condos. In my home town I think the shophouses have almost doubled in the last couple of years, most remain empty. What is going to happen when the US stops their stimulus program and there is no more cheap money? If you have Thai Baht I would consider moving it to another currency or gold. If you were thinking of bringing money to Thailand I would wait. I think the baht will be trading at 35-40 in a year. If you think I'm wrong I have a nice building lot for sale on Samui.

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I think your wrong......Mrs Issangeorge does have a nice plot for sale in Samui though?

[krisb]

Mr IssanGeorge, I actually hope your right. Let it get to 35 or 40 in a year. Hopefully 40 t the $.

I don't think your right.

[Chittychangchang]

In 1997 the economy blewup, because of overbuilding. shophouses and condos were going up everywhere, some in the middle of nowhere. The Thais were getting cheap money from overseas and using it to build these buildings. Many of them have never been used and are now falling down or have been torn down. The same thing is happening today. Cheap overseas money is being used to produce unneeded shophouses, short time hotels and condos. In my home town I think the shophouses have almost doubled in the last couple of years, most remain empty. What is going to happen when the US stops their stimulus program and there is no more cheap money? If you have Thai Baht I would consider moving it to another currency or gold. If you were thinking of bringing money to Thailand I would wait. I think the baht will be trading at 35-40 in a year. If you think I'm wrong I have a nice building lot for sale on Samui.

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Where is your lot and how much?

CCC

[MrWorldwide]

johnthompson said:

I don't think Thailand is a particularly rich country.

I guess it comes down to how you define rich. Do you consider Indonesia a 'rich country' ? Brazil ? China ? Would you say the top 10% in Bangkok had more money than the top 10% in Arkansas ?

[corkythecat]

the important/primary object is getting a loan to build and deposits from prospective buyers....then......

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[krisb]

it is very profitable to build these villages or apartments.

Absolutely profitable and Kevvy you would have seen the multiplying effect building has I'm sure. Not just in your hip pocket but down the whole line. Even the property purchaser who has outlayed their hard earned will see a profitable return 1 day when they sell, or at least can raise equity to get that new car they want. This keeps the banks, government, and even the guy who sold them the new car happy. Not many industries stimulate the economy quite like construction does. In fact I can't think of any.

[krisb]

How's this for an idea Kevvy, build then lend the home loan to the prospective buyer. 2 birds with 1 stone.

[bangkokstick]

If you had money you would prefer to see it becoming buildings than disappear in a bank !

[IMA_FARANG]

They are selling them as "investments". There are Thais with money to invest.... and the thought is that apartments are a good investment because "real estate" always sells.

Of course, that's on the assumption that there are always going to be "buyers" for good property and good value.

We shall see if that is a good assumption or not.

Look around in Bangkok at night .... you will see many condo blocks with less than half the lights on.

I would like to know, honestly, what the actual percentage of those "sold" condo units are actually occupied by the owner.

They won't yell you that figure, what they quote ids what percentage of the available units are "sold".

That's not the same as "owner occupied" units in the condo block, is it?

[jaideeguy]

How can they keep building new buildings and apartments?

Simple answer............they build cheaply with low quality materials so that the average Thai house falls apart after 7 years and you have to tear down and build another 'disposable house'.

[IMA_FARANG]

They are selling them as "investments". There are Thais with money to invest.... and the thought is that apartments are a good investment because "real estate" always sells.

Of course, that's on the assumption that there are always going to be "buyers" for good property and good value.

We shall see if that is a good assumption or not.

Look around in Bangkok at night .... you will see many condo blocks with less than half the lights on.

I would like to know, honestly, what the actual percentage of those "sold" condo units are actually occupied by the owner.

They won't yell you that figure, what they quote ids what percentage of the available units are "sold".

That's not the same as "owner occupied" units in the condo block, is it?

[IMA_FARANG]

They are selling them as "investments". There are Thais with money to invest.... and the thought is that apartments are a good investment because "real estate" always sells.

Of course, that's on the assumption that there are always going to be "buyers" for good property and good value.

We shall see if that is a good assumption or not.

Look around in Bangkok at night .... you will see many condo blocks with less than half the lights on.

I would like to know, honestly, what the actual percentage of those "sold" condo units are actually occupied by the owner.

They won't tell you that figure, what they quote is what percentage of the available units are "sold".

That's not the same as "owner occupied" units in the condo block, is it?

Edited September 22, 2013 by IMA_FARANG

[AlexRRR]

How can they keep building new buildings and apartments?

Simple answer............they build cheaply with low quality materials so that the average Thai house falls apart after 7 years and you have to tear down and build another 'disposable house'.

Well mr jaideeguy, you obviously don't know anything about building or finance.

Lets start with finance, some one is loaning the money and the developer will need to get a percentage sold to make it viable to start building, until they reach that point there will be no start.

As for the actual building it takes several years of planning and gaining aprovals before the green light is given to actualy build.( im talking high rise) If your in Australia with all the red tape it can take a life time, im still waiting 18 mths for town planning approval for 3 units down on the coast.

And my number one HATE is when I hear or read from stupid mornons who have no f""""" idea of building and use that worn out old term..."cheap materials"

To enlighten you over time the industry changes as do the products we use some good reasons are for costs and availability of what we once used, also some of these so called cheaper options actually are better engineered for todays needs. There are many examples of these products such as roof trusses, engineered hyspan beams, MDF archs and skirts, in fact lot of manufactured board are used in high end joinery and fit out, only the style and profile and fittings vary between a million dollar house to a $150,000 house.

Thailand once built in timber but shrinking forests and rising costs pretty much killed that, concrete construction is a European style introduced because its cheap and not necessarily the best due to heat retention but hey they don't mind.

There is no cheap materials but if the job is not well supervised by professionals who know there game you will get poor workmanship and that my friend is the problem the world over.

[David48]

How can they keep building new buildings and apartments?

Simple answer............they build cheaply with low quality materials so that the average Thai house falls apart after 7 years and you have to tear down and build another 'disposable house'.

Well mr jaideeguy, you obviously don't know anything about building or finance.

Lets start with finance, some one is loaning the money and the developer will need to get a percentage sold to make it viable to start building, until they reach that point there will be no start.

As for the actual building it takes several years of planning and gaining aprovals before the green light is given to actualy build.( im talking high rise) If your in Australia with all the red tape it can take a life time, im still waiting 18 mths for town planning approval for 3 units down on the coast.

And my number one HATE is when I hear or read from stupid mornons who have no f""""" idea of building and use that worn out old term..."cheap materials"

To enlighten you over time the industry changes as do the products we use some good reasons are for costs and availability of what we once used, also some of these so called cheaper options actually are better engineered for todays needs. There are many examples of these products such as roof trusses, engineered hyspan beams, MDF archs and skirts, in fact lot of manufactured board are used in high end joinery and fit out, only the style and profile and fittings vary between a million dollar house to a $150,000 house.

Thailand once built in timber but shrinking forests and rising costs pretty much killed that, concrete construction is a European style introduced because its cheap and not necessarily the best due to heat retention but hey they don't mind.

There is no cheap materials but if the job is not well supervised by professionals who know there game you will get poor workmanship and that my friend is the problem the world over.

Dear AlexRRR ... I also have some knowledge of the Australian Property Market and the Building Trade.

Unfortunately, you have made the mistake of trying to transpose your knowledge, gained in Australia and then superimpose that on the Building and Project Financing Industry here in Thailand ... I can assure you ... they are worlds apart.

Should you not believe that ... make that post, written above, in the Building Forum, and you would be drowned in the people, building owners in Thailand who will refute most of the things you espoused above.

Let me address just one point you raised ... "concrete construction' was not introduced because of 'shrinking forests and rising costs' ... one of the main reasons it is used now is a combination of more disposable income to build with and the extreme termite problem that exists in Thailand.

This is 220V Wiring that was eaten by the termites, to a point it shorted between active and neutral.

Termites don't eat concrete.

MDF arches and skirts ...

.

[zydeco]

johnthompson said:

I don't think Thailand is a particularly rich country.

I guess it comes down to how you define rich. Do you consider Indonesia a 'rich country' ? Brazil ? China ? Would you say the top 10% in Bangkok had more money than the top 10% in Arkansas ?

Bangkok and Arkansas might be closer than you think. The Wal-Mart family is from Arkansas. So is the world's worst egomanical football owner, Jerry Jones of the Dallas Cowboys. Not to mention--the Clintons.

[AlexRRR]

Yes david48 ive crossed swords with the DIY builders in thai via in an other life who know jack s****, there knowledge is flat earth policy.

You don't think there are termite problems in AU?

There is far more negative comments in here than positive ones and the trouble is that some "bright spark" makes a comment about something then all the less enlightened beings assume he is an expert on the subject.

And your wrong that concrete was introduced because of the termite problem it just happened to be cost effective and had many advantages over a shrinking timber supply.

[FiftyTwo]

Termites don't eat concrete.

MDF arches and skirts ...

.

While termites don't eat concrete, they will eat through your concrete floor to get at the tasty wooden flooring you put on top of it in a flash.

[David48]

Termites don't eat concrete.

MDF arches and skirts ...

.

While termites don't eat concrete, they will eat through your concrete floor to get at the tasty wooden flooring you put on top of it in a flash.

Actually, they either squeeze though the concrete cracks or ... more often ... fly in.

.

[ABCer]

johnthompson said:

I don't think Thailand is a particularly rich country.

I guess it comes down to how you define rich. Do you consider Indonesia a 'rich country' ? Brazil ? China ? Would you say the top 10% in Bangkok had more money than the top 10% in Arkansas ?

Exactly the thought I had reading the OP.

Do not know how they keep building. Not an expert on bubbles etc.

But saying Thailand is not a rich country is a bit too rich.

Thailand is a very rich country. But 95% - 99% of population is not rich.

I think give or take a few %% explains the situation more precisely.

On the other hand, isn't this situation true for other countries?

Edited September 22, 2013 by ABCer