info for Thai vs Farang ownership

[driftpig]

Just a question.

it the asking price increased if a farang purchases a thai owned condo.

[falkan]

sometimes yes, sometimes no...

how long is a piece of string btw?

[davejones]

I think if it's a condo building that's popular with foreigners and all the quota is used up, then the price could indeed be higher, simply because you have to buy from a foreigner and can't buy from a Thai. That can create two-tier pricing. I've no idea how common this is though.

[johnnyk]

Unless you have a good Thai friend to pretend interest, you will never know.

[jimmybkk]

In general I would say not. However, if the seller is a Thai individual rather than a Thai company, and you are making the approach to the seller yourself it would not surprise me if the seller would accept a lower offer from a Thai than they would accept from you, based purely on the fact that they figure you can afford to pay more. I would be surprised if they would actually increase the asking price just because you are a farang.

I suppose in theory, in a building or location that is popular with both foreign and Thai buyers, the units held under foreign quota should be worth a little more than units in Thai quota, based purely on supply & ease of reselling - there is less supply of units that foreigners can buy (49% vs. 100%) and no restrictions on who they can sell to.

[simple1]

Here in Pattaya many condo developments have higher prices for foreigners that are detailed in the published list price, a quick example below. You would assume these would be passed on at resale

http://www.matrix-developments.com/pattaya-condo-specials/

[davejones]

Here in Pattaya many condo developments have higher prices for foreigners that are detailed in the published list price, a quick example below. You would assume these would be passed on at resale

http://www.matrix-developments.com/pattaya-condo-specials/

I don't see any dual pricing on the page you linked to. I only see some special offers and whether they can be owned by a foreigner or via a Thai company. If it says Thai company, I assume they mean that all the foreign allocation is sold already. There isn't dual pricing shown anywhere.

[Senechal]

The answer to your question depends largely on the region, in areas of heavy farang-demand like Pattaya you'll often find better deals on Thai ownership condominiums because the potential pool of buyers can be much lower.

...which is reason number 500 not to buy a condo in Pattaya.

[davejones]

The answer to your question depends largely on the region, in areas of heavy farang-demand like Pattaya you'll often find better deals on Thai ownership condominiums because the potential pool of buyers can be much lower.

...which is reason number 500 not to buy a condo in Pattaya.

Isn't it best to own a condo in an area where demand is high, as that means the condo will be much easier to sell? Buy in an area with low demand and you'll get a cheaper condo but have more difficulty selling for a good price.

[simple1]

Here in Pattaya many condo developments have higher prices for foreigners that are detailed in the published list price, a quick example below. You would assume these would be passed on at resale

http://www.matrix-developments.com/pattaya-condo-specials/

I don't see any dual pricing on the page you linked to. I only see some special offers and whether they can be owned by a foreigner or via a Thai company. If it says Thai company, I assume they mean that all the foreign allocation is sold already. There isn't dual pricing shown anywhere.

You will see pricing for Thai Company name or foreigner owned, therefore indicates different pricing structures.. Pricelists that I have personally been given for new condo developments in Pattaya also have pricing for Thai nationals ownership. For exactly the same specs pricing increases, the lowest price being Thai ownership, the highest price being for outright foreign owneship, in other words a three tier pricing policy.

EDIT: Online pricelist showing pricing structure at http://maldives.pattaya-laguna.com/

Edited November 1, 2013 by simple1

[Senechal]

The answer to your question depends largely on the region, in areas of heavy farang-demand like Pattaya you'll often find better deals on Thai ownership condominiums because the potential pool of buyers can be much lower.

...which is reason number 500 not to buy a condo in Pattaya.

Isn't it best to own a condo in an area where demand is high, as that means the condo will be much easier to sell? Buy in an area with low demand and you'll get a cheaper condo but have more difficulty selling for a good price.

"Best" would be a matter of personal opinion. My personal opinion is that buying a condominium in Thailand for long term investment value is a terrible idea for multiple reasons. If you think a condo will have increased value in 20 years, that is a theory that is not well supported by evidence. Thai condominiums are not well constructed as a rule. Building standards are extremely low. Nor do Thais typically maintain their condominiums well over time. Add to that the absolutely terrible legal protections afforded to farangs, the extraordinary levels of fraud in Thailand and the historic high volatility in Thai real estate prices in general and there's not a great argument for investment returns over the long term. (And there is a potential for major loss, which typically does not exist in other real estate markets). Land, of course would be a different matter -- but as farangs land is not a game we can play. IMHO, it's "best" to buy only what you want, like and need. And consider investment potential last. But that's just my 2 baht.

[davejones]

Here in Pattaya many condo developments have higher prices for foreigners that are detailed in the published list price, a quick example below. You would assume these would be passed on at resale

http://www.matrix-developments.com/pattaya-condo-specials/

I don't see any dual pricing on the page you linked to. I only see some special offers and whether they can be owned by a foreigner or via a Thai company. If it says Thai company, I assume they mean that all the foreign allocation is sold already. There isn't dual pricing shown anywhere.

You will see pricing for Thai Company name or foreigner owned, therefore indicates different pricing structures.. Pricelists that I have personally been given for new condo developments in Pattaya also have pricing for Thai nationals ownership. For exactly the same specs pricing increases, the lowest price being Thai ownership, the highest price being for outright foreign owneship, in other words a three tier pricing policy.

EDIT: Online pricelist showing pricing structure at http://maldives.pattaya-laguna.com/

I see what you mean. I think you only get that pricing structure where this is very high foreigner demand. Where foreigner demand is low the prices would usually be the same. I suppose in new developments they want to discourage foreigner name ownership for initial sales, as once they reach 49% they would have difficulty selling the rest of the units. So offer a discount for non-foreign name ownership and many will opt for that, making the later units easier to sell.

[davejones]

Senechai or a mod - Can you correct Senechai'spst above, as it show me as making a comment I didn't make.

Senechai - you posted your comment under my name. You need to type outside the quote block.

Anyway, what you say has nothing to do with my comment. I'm just saying that anywhere (Thailand and the rest of the world) it's better to buy in an area with high demand than in an area with low demand. I haven't made any comment about whether investing in property in Thailand is good or bad. Many who buy in Thailand buy to live not invest, so I don't see how your comment is relevant. It's like saying no-one should buy a car because it will be worth less in 20 years time. Of course it will. So if you buy a condo for 5m and sell it for 4m in 20 years time, it's cost you 1m to live there for 20 years. How much would it have cost in rent? Is renting a good investment. All you get all the rent back when you leave in 20 years time. The argument that you shouldn't buy because your property might be worth less in 20 years time just doesn't make any sense at all.

[davejones]

Also, what evidence do you have that property prices haven't risen in the last 20 years in Thailand? From what i can see they have risen quite a lot. I know many Thais that bought 10-20 years ago and they are all showing good profits based on sales or other properties nearby. Show me somewhere in central Bangkok that I can buy a condo at 1993 prices. I can't find any.

Edited November 1, 2013 by davejones

[Senechal]

Also, what evidence do you have that property prices haven't risen in the last 20 years in Thailand? From what i can see they have risen quite a lot. I know many Thais that bought 10-20 years ago and they are all showing good profits based on sales or other properties nearby. Show me somewhere in central Bangkok that I can buy a condo at 1993 prices. I can't find any.

When you say "prices"... do you mean re-sale prices of condos? Or prices of new units? Yes, prices of new units have gone up dramatically over the past 20 years. But that's not what we're talking about. Please show me a condominium unit built in 1993 that proved to be a fantastic investment. There may be some, but I don't think the investment returns have been uniformly positive over the long term for condo owners. Over the past few years, yes -- of course -- but that's because we're in a massive property boom. And we know how those go...

You also said "The argument that you shouldn't buy because your property might be worth less in 20 years time just doesn't make any sense at all". This I don't understand at all. There are countless cities around the world where real estate has lost value for multi-decade periods, and or never regained it's value. Why would this argument not make sense?

ps: Apologies for typing in the quote box. Let the record hereby state that I said that about property prices, not DaveJones!

Edited November 1, 2013 by Senechal

[davejones]

Also, what evidence do you have that property prices haven't risen in the last 20 years in Thailand? From what i can see they have risen quite a lot. I know many Thais that bought 10-20 years ago and they are all showing good profits based on sales or other properties nearby. Show me somewhere in central Bangkok that I can buy a condo at 1993 prices. I can't find any.

When you say "prices"... do you mean re-sale prices of condos? Or prices of new units? Yes, prices of new units have gone up dramatically over the past 20 years. But that's not what we're talking about. Please show me a condominium unit built in 1993 that proved to be a fantastic investment. There may be some, but I don't think the investment returns have been uniformly positive over the long term for condo owners. Over the past few years, yes -- of course -- but that's because we're in a massive property boom. And we know how those go...

You also said "The argument that you shouldn't buy because your property might be worth less in 20 years time just doesn't make any sense at all". This I don't understand at all. There are countless cities around the world where real estate has lost value for multi-decade periods, and or never regained it's value. Why would this argument not make sense?

ps: Apologies for typing in the quote box. Let the record hereby state that I said that about property prices, not DaveJones!

LOL for last sentence.

It doesn't make sense to me because when I buy a home I don't really care if it goes up in price on not. All I care about is having a nice place to live. If I planned to live somewhere for 20 years and could buy the condo for 5 million vs. renting for 25k/mth (0.3million a year), why wouldn't I buy? 20 years rent = 6 million. Rents will likely rise over the next 20 years, so in reality the total rent will be higher. I know there are other costs involved with buying, such as monthly fees, buy buying still seems a better long-term bet to me. Staying somewhere that long I would just prefer a place I owned. That's just me, If others don't mind renting then it's their choice. But my point is that I would buy to live not invest. If I wanted to invest in property I'd buy somewhere else - like UK.

Most of the Thais I know have houses not condos, and the resale value has gone up, not compared to new properties. i.e. they bought for 1 million 20 years ago, and now houses in their project are generally selling for 4-5 million. That's 20-year old houses. Still in good condition, and well built. I've seen places that look like they're falling down after 10 years so I know what you mean. But you need to buy a quality place to begin with. Not all Thai housing is low quality.

Give me a worked example of how you think it doesn't work. If it's a pure investment, don't forget to include rental income. And don't forget that some people are currently earning 1% on their cash. Rental from an investment would give you much more, so you are actually losing money holding cash.

[Senechal]

Oh come on DaveJones you keep changing the conversation. Honestly what on earth do houses have to do with what we're talking about? Thai condo investments are highly iffy and I'll leave it at that. It's my experience. Of course its not a blanket truism and of course not all construction is low quality (straw man much?) and there are exceptions over the long term. But you're starting to sound like one of those people who believes contrary to all historic evidence that all real estate always goes up in value. It's not true anywhere and it's particularly not true in the context of Thai condos.

[davejones]

Oh come on DaveJones you keep changing the conversation. Honestly what on earth do houses have to do with what we're talking about? Thai condo investments are highly iffy and I'll leave it at that. It's my experience. Of course its not a blanket truism and of course not all construction is low quality (straw man much?) and there are exceptions over the long term. But you're starting to sound like one of those people who believes contrary to all historic evidence that all real estate always goes up in value. It's not true anywhere and it's particularly not true in the context of Thai condos.

Now you're assuming I believe things I don't. Just for the record, I don't believe that real estate always goes up in value. Of course it doesn't. You only have to look at property crashes to see that's not true. But it's generally true that it's been a good investment over an extended period of time, especially in the West.

Anyway, I wouldn't buy a condo in Thailand as an investment, so we seem to agree. So what are we debating?

[sotsira]

OP,

A farang can't purchase a Thai owned condo as it won't fall in to the 49% foreign owned quota.

[Senechal]

OP,

A farang can't purchase a Thai owned condo as it won't fall in to the 49% foreign owned quota.

Thais can own foreign-designated condos, and AFAIK many do. If a building is 80% Thai owned, there are plenty of scenarios where a farang could legally purchase a Thai owned condo. The OP wasn't asking about legality, but about dual pricing.

[MAJIC]

Here in Pattaya many condo developments have higher prices for foreigners that are detailed in the published list price, a quick example below. You would assume these would be passed on at resale

http://www.matrix-developments.com/pattaya-condo-specials/

Well at least they refer to us as Foreigners,and not Farangs,so they do know the difference!

Edited November 1, 2013 by MAJIC

[davejones]

Here in Pattaya many condo developments have higher prices for foreigners that are detailed in the published list price, a quick example below. You would assume these would be passed on at resale

http://www.matrix-developments.com/pattaya-condo-specials/

Well at least they refer to us as Foreigners,and not Farangs,so they do know the difference!

Maybe they have non-farang foreigners purchasing as well, so need to make it clear that the pricing is for all foreigners and not just farangs.

[davejones]

OP,

A farang can't purchase a Thai owned condo as it won't fall in to the 49% foreign owned quota.

Not true. If the 49% quota hasn't been filled, a foreigner can buy a Thai owned condo if they want. There are no restrictions at all on buying from Thais. In fact, it's usually Thais that own the condo buildings, so you don't have any choice but to buy from them. Most buildings are 100% Thai owned to begin with.

[MAJIC]

Here in Pattaya many condo developments have higher prices for foreigners that are detailed in the published list price, a quick example below. You would assume these would be passed on at resale

http://www.matrix-developments.com/pattaya-condo-specials/

Well at least they refer to us as Foreigners,and not Farangs,so they do know the difference!

Maybe they have non-farang foreigners purchasing as well, so need to make it clear that the pricing is for all foreigners and not just farangs.

And did you see the word Farang in the Advert? No?

[davejones]

No. LOL. Maybe there are different rates for farangs and non-farang foreigners.

[driftpig]

Thank you all for the feedback.

My next question would be, who or how do I find out if the buildings non Thai to Thai ratio and if I can still proceed with the purchase.

Thank you

Sent from my iPhone using Thaivisa Connect Thailand mobile app

[davejones]

Ask the juristic person in the condo building.