property appreciation ?

[mike111]

Any info on whether condos appreciate over time (% per year)?.

Main locations I'm considering are BKK, Pattaya/Jomtien, maybe Chiang Mai

Cheers

[OnMyWay2]

if you're looking for appreciation I think it's more about timing than the averages. They will appreciate over time but how much greatly depends on when you buy or sell.

[KittenKong]

In the Pattaya area they may rise but I see no obvious reason why they should (no shortages of either land or existing buildings, many new condos planned, many used condos currently for sale, little real demand that isn't fuelled by easy credit or capital flight or money cleansing).

I neither know nor care about what happens in Bangkok but I suspect that much of the same applies, with prices even sillier than they are here.

[trogers]

if you're looking for appreciation I think it's more about timing than the averages. They will appreciate over time but how much greatly depends on when you buy or sell.

Obviously, the slope of the sine curve applies...

And when you are caught on the negative slope, it's depreciation, and not appreciation.

Edited May 27, 2014 by trogers

[Globalist]

Speculating in property value is quite a lot about timing and luck, as also stated above.

So, the question cannot really be answered in a meaningful way.

Property can however be a good and safe income-yielding investment, whether in Thailand or not, if one chooses the right property.

Edited May 27, 2014 by Globalist

[worgeordie]

Most likely not the best time to buy,as the market is about at its limit as

far as prices go,and they way they are building them up here in Chiang

Mai,they are going up like mushrooms.

If i could stand on the roof of my house,i would be able to see 6/8 new

condo projects ,some just finished,others in various states of been built,

and i live out side the town,so i would say Chiang Mai at least is going to

have a glut of condos,don't know whats happening in other parts of the

country,but i suspect its the same.

So oversupply is one factor,price is another,add the situation at the moment

here,are all reasons not to invest,unless you are in it for the very long term.

regards Worgeordie

[marioc]

As far as I am concerned, in Chiang Mai, condo's prices look like they are going down a bit or just maintaining their price...... so many for sale or rent.

Amazing.

I wouldn't buy 1 just for investment at the moment.

In my opinion it is a wait and see situation.

[shirtless]

To make money on property you really need to find a buyer with no knowledge of Thailands real estate, Unfortunately they are as rare as hens teeth these days,

[trogers]

Most likely not the best time to buy,as the market is about at its limit as

far as prices go,and they way they are building them up here in Chiang

Mai,they are going up like mushrooms.

If i could stand on the roof of my house,i would be able to see 6/8 new

condo projects ,some just finished,others in various states of been built,

and i live out side the town,so i would say Chiang Mai at least is going to

have a glut of condos,don't know whats happening in other parts of the

country,but i suspect its the same.

So oversupply is one factor,price is another,add the situation at the moment

here,are all reasons not to invest,unless you are in it for the very long term.

regards Worgeordie

"What the wise man does in the beginning, the fool does in the end" - said Warren Buffett

The wise man buys when the fundamentals are in his favor. When speculation steps in, fundamentals are thrown out the window, and the rising price motivates more and more buying.

Edited May 27, 2014 by trogers

[mike111]

thanks for the replies.

a 5% appreciation per year is quite common, say, in Europe.

anything like that for Thailand (I am referring to condos in a good location, well maintained, etc.) ?

Cheers

[Postmaster]

There is no Capital Appreciation of property whatsoever in any of the Thai resorts. You have heard from the Chiang Mai

commentator that there is none there either. I not sure about Bankgkok but I think it is unlikely there too. This does not

mean you will lose all your money even if you can get a resale, which is difficult. As the exchange rate on your currency

strengthens you will largely be compensated when you have to sell at a lower figure than when you bought.

[HUAHIN62]

Don't buy now. Wait until it becomes a buyers market. It won't take long +- 6 months to a year. In our area they are building condo's at the same rate as in the past, between Chaam and HH there are 7000 condos in the process of completion. If I measure economic activity at present plus expected further downturn in foreign buying (normally in our area foreigners buy +- 20% to 30% of condo's), there will be extreme preasure on developers to sell in the near future. What I am also noticing is that there are an extreme downturn in retail activity. At Venezia mall many stores aren't rented out a year after the mall opened and the one's that are occupied are struggeling (some have shut off their aircons to save money and there aren't shoppers). The number of Thai tourists also declined, in the past you could see 13 tour busses coming through town in a convoy, but today its 1 or 2.

[belg]

the laws of demand & supply does not work here in thailand....

[Berkshire]

thanks for the replies.

a 5% appreciation per year is quite common, say, in Europe.

anything like that for Thailand (I am referring to condos in a good location, well maintained, etc.) ?

Cheers

I'd be careful when comparing condo prices in Thailand to the west. From what I've seen of condo buildings in general, they're simply not managed in a way that would enhance long term value. Maintenance fees are typically too low to maintain the buildings properly, so what you have is a slow decline in everything from common areas to exterior paint. The Board of Directors, comprising of owners, don't seem to have the power to do much. They can't even force other owners to pay overdue maintenance fees.

I'm sure there are some well-maintained buildings out there...and those will be the ones priced accordingly (you get what you pay for...as always). But if you're thinking major appreciation, even 5% a year, I'd think again.

[KittenKong]

To make money on property you really need to find a buyer with no knowledge of Thailands real estate, Unfortunately they are as rare as hens teeth these days,

The agents selling off-plan condos in Pattaya would disagree with you.

[Emster23]

I own my condo in Jomtien. Bought cheap expect to sell cheap, if ever. Supply and demand laws were not revoked in Thailand (ref rice buying scheme, as they are finding out). Huge numbers of condos going up, which should drive price down. Deadest I've seen this place since got here 8 years ago or so.

But Thai women do appreciate you buying them a house in their name, if you use that definition of appreciate.

Edited May 27, 2014 by Emster23

[mike111]

Deadest I've seen this place since got here 8 years ago or so.

That's interesting. I've heard its loaded with tourists, particularly Russians & other EE

[HerbalEd]

There is no Capital Appreciation of property whatsoever in any of the Thai resorts. You have heard from the Chiang Mai

commentator that there is none there either. I not sure about Bankgkok but I think it is unlikely there too. This does not

mean you will lose all your money even if you can get a resale, which is difficult. As the exchange rate on your currency

strengthens you will largely be compensated when you have to sell at a lower figure than when you bought.

If what you say is true then property in Thailand would NEVER increase in value .. e.g, the price of a condo twenty years ago would be the same price today. Fortunately this is not true.

[malcoml]

Deadest I've seen this place since got here 8 years ago or so.

That's interesting. I've heard its loaded with tourists, particularly Russians & other EE

That is correct there has been a changing of the guard as such.

Gone are the high spending European, American, and Australian tourists.

Now Pattaya is left with Russian honeymooners, Chinese tour groups, groups of Indian men on short company funded business trips looking to share one girl among ten of them, and a mixed group of typically low end people from the Middle East who are there for no other reason than sit in a beer bar and dance at a disco.

Fact is that as nations have become more wealthy they are choosing to holiday in locations that are more developed and often more expensive.

I see it with my own friends who once would have gone to Bali or Thailand. they are now going to Japan, Europe, and if you can believe it Hawaii is making a comeback.

Shows such as banged up abroad have not done Thailand any favours.

[RedQualia]

Don't buy now. Wait until it becomes a buyers market. It won't take long +- 6 months to a year. In our area they are building condo's at the same rate as in the past, between Chaam and HH there are 7000 condos in the process of completion. If I measure economic activity at present plus expected further downturn in foreign buying (normally in our area foreigners buy +- 20% to 30% of condo's), there will be extreme preasure on developers to sell in the near future. What I am also noticing is that there are an extreme downturn in retail activity. At Venezia mall many stores aren't rented out a year after the mall opened and the one's that are occupied are struggeling (some have shut off their aircons to save money and there aren't shoppers). The number of Thai tourists also declined, in the past you could see 13 tour busses coming through town in a convoy, but today its 1 or 2.

Agreed. The economy -- in Chiang Mai at least, but maybe elsewhere -- was a bit bad for an extended period of time. People with land were just sitting on it, waiting to build. A couple of years back and the economy started to improve, then boom. There are new moo baans and condos all over the place just now. Multistory condos are even being built out in the sticks. Worldwide, whenever there's a building boom, the value of existing homes tends to stagnate. Now is probably not the time to buy if one is looking for appreciation of property with the idea of selling it for more in the future. Wait at least six months, and more likely a year or more.

That said, investments are investments. You should not overlook the return from renting property, nor overlook the tax advantages relating to rental property. If you rented a small condo for say, 10K Baht per month, then over the course of ten years, your rent would be 1.2 million Baht. Less expenses, but note that said expenses are generally deductible from one's taxes. And of course, that means more complicated tax filings, but hey -- I've found attention to income taxes to pay quite well... Better than a lot of other part-time jobs or teaching gigs. And after those ten years of receiving rent payments and enjoying tax benefits, then if you can sell it for what you paid, you'd be doing OK.

If you do decide to buy something in Chiang Mai, be aware that the value of land (as opposed to houses or condos) has gone up greatly in the Chiang Mai area in the past few years. Given this, you might want to consider buying a single family home, rather than a condo, if looking for long term appreciation.

A few other thoughts: the current exchange rate should be factored in when timing any purchase, if your income is from abroad. A three million Baht condo would cost quite a bit more if the exchange rate was 28-29, and/or quite a bit less if the exchange rate was 33-34 (the first house I built here was done when the exchange rate was 42 Baht per US dollar). Second: pay cash. If your income is foreign, you don't need to be in debt to a Thai bank (assuming you even could be).

Choke dee, krup.

Edited May 27, 2014 by RedQualia

[Robert24]

I would echo some of the previous comments. The property market is red hot in Thailand and if you have time, I would wait with a purchase. If you still think you need to buy now, buy land or a single family home. Get familiar with the market where you are planning to buy, look at reposessed properties or land plots that are up for auction rather than buy brand new. Often you can get a significant discount through auctions or making a deal with a bank who is trying to offload reposessed properties.

[MichaelJohn]

Someone said to me that Thai's view a condo as Europeans view a car purchase.

They don't pay the Common Fee, they don't care about the investment, maintenance etc etc they live in it till it's worn out then move on, but another.

I personally don't go that far; but, I think you should view your investment akin to rental. If it goes down by X,000 B per month, as long as that reduction is less than what you'd pay to rent something similar then you're okay :-)

[ggt]

Unless you are a seasoned real-estate investor...I would tread very carefully...the real-estate business is ripe with deception...if you can find someone who has had a good experience with real-estate people...then get their references...lots of money changing hands during a transaction...just make sure it is all legit...

[VegasVic]

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if you're looking for appreciation I think it's more about timing than the averages. They will appreciate over time but how much greatly depends on when you buy or sell.

In Thailand the price of land and housing seems to go up without any rational reason, I imagine that this will continue until the day it no longer rises Ask some folks who owned property prior to 1997 and they will let you know what can happen When the property bubble and shadow banking bubble bursts in China, this will have strong shock waves throughout the entire region so tread cautiously my friend

[tangcoral]

We purchased a beach front condo with seaview in chaam in 1989 for 900K, just sold it last week for 1.4mil, mind you that was 25 years ago

The condo is 25 yrs old and still in decent shape for its age.

Edited May 27, 2014 by tangcoral

[1FinickyOne]

From what i have seen, physical property actually depreciates as the climate is tough on houses. What does appreciate is land values. There are so many condos on the market and if you buy one, it will likely be less in demand than a new condo - Thai don't like to buy used homes/condos… if there is a lot of inflation, your investment can go up but i would not buy for that reason only.

Just figure some depreciation in against the fact that it is an investment you can use and cover some living expenses.

[Epsacori]

This seems to be a more objective and actual report on the Thai economy and property market: http://www.globalpropertyguide.com/Asia/Thailand

[Epsacori]

This seems to be a more objective and actual report on the Thai economy and property market: http://www.globalpropertyguide.com/Asia/Thailand

[malcoml]

We purchased a beach front condo with seaview in chaam in 1989 for 900K, just sold it last week for 1.4mil, mind you that was 25 years ago

The condo is 25 yrs old and still in decent shape for its age.

This quoted post probably answers the OP's question.

A a return that is nowhere near inflation over that period.

[rotary]

If you need a place to live go for it.

If you are looking to make money on an investment you might consider Las Vegas at the poker table, your odds might be better in making a profit.

Of course some do make a profit off real estate in Thailand but that is by no means the majority.

Edited May 28, 2014 by rotary