property appreciation ?

[davejones23]

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,

Not true at all. Buy from a motivated seller and you already have your profit. I know many Thais that have made very good money buying and selling property. They tend to buy from Thais and sell to Thais. It all comes down to location. You need to buy in an area where there is enough demand at selling time. So buy where Thai people want to live. I don't think buying a condo in places like Jomtiem would provide good price appreciation, but that's just my opinion. But houses and condos in good areas tend to sell well. For the OP, I doubt he'd be able to find those areas. You need to live here, hang out with Thais, speak Thai, etc to know what's really going on.

[davejones23]

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.

I've found the opposite to be true. Prices in Bangkok seem very reasonable to me when compared to Chiang Mai, Pattaya, and even some small NE Towns. I think Bangkok property is a little overpriced, but I wouldn't go as far as saying the prices are silly. For a major international city, the prices are still lower than some depressing UK towns.

I suppose it depends on your definition of 'silly'. A 4-bed townhouse in great location in Silom can be had for 12-15 million baht. That is very reasonable indeed.

[malcoml]

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,

Not true at all. Buy from a motivated seller and you already have your profit. I know many Thais that have made very good money buying and selling property. They tend to buy from Thais and sell to Thais. It all comes down to location. You need to buy in an area where there is enough demand at selling time. So buy where Thai people want to live. I don't think buying a condo in places like Jomtiem would provide good price appreciation, but that's just my opinion. But houses and condos in good areas tend to sell well. For the OP, I doubt he'd be able to find those areas. You need to live here, hang out with Thais, speak Thai, etc to know what's really going on.

We are all going to be rich then as every man and their dog is a motivated seller.

[PattayaPhom]

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.

A home for 25 years rather than renting with 65% appreciation isnt that bad.

[Robert24]

It's actually 55% appreciation but I agree with Malcolm that you would have to add the rental income over this time period to get a full picture of your return on investment.

One just thinks that if you would have bought a piece of land for the same price 25 years ago that you would have a significantly higher appreciation in value than 55%.

[Globalist]

Yes indeed, rent has to be considered.

In any case, in spite of seaview, the example given by tangcoral did not have an exceptionally strong value appreciation, by any standard.

That doesn't mean that much for the general case of Thai property though.

If the property in question had been in a different location, (for example central Bangkok, or directly on the beach in Phuket or even Pattaya) and was of good quality construction, the appreciation (in % as well as absolute) could have been considerably higher, if not perhaps even exceptional.

Edited May 29, 2014 by Globalist

[GOLDBUGGY]

My observation is that Thailand is too risky to buy property in.

It firstly is a country where you are legally not allowed to own land, thus owning a house as you know it is not allowed. Sure there are ways to dress this up. Get the Thai Wife the house in her name and get a 40 year lease. Get the House in your name but the land under your wife's name. Both okay if you plan to live in it a long time and your relationship doesn't go South. But for Investment purposes? Forget about it.

The Thai Real Estate Market seems to go against the grain. With an over supply of housing prices should come down, but they don't. They stay the same. Seems investors here would rather keep them then lower there price. As a result you will find many condos that have been up for sale for years and many other that remain empty. Yet new condo buildings are going up everywhere.

Another scary factor for me is the amount of illegal condo owners there are here. Nobody really knows for sure how many, but in my view there is a lot. Who set up a fake company so they could buy a condo in the company name and exceed the 49%-51% Farang-Thai Ownership in a Condo Building. So far this hasn't been a problem but just think for a second what would happen to housing prices if these illegal condo owners where really investigated and forced to sell in a short time if found out?

Not saying people here haven't made money here by doing this. When I think what you could have bought in Pattaya 25 years ago to compare to now it would have been a great investment. But as many have said the market here seems to be topped out right now. If it doesn't go up there is only one other direction it can go. If you plan to live here a long time buying a condo legally is okay as you are not really looking at this so much as an investment. If you were renting would be better.

If you are still looking at real estate as an investment why not buy or rent out your property in your home country and live off that here? You will still get the appreciation from real estate but be worry free here. A change in government, the value of the Thai Baht, Immigration Laws, and one hundred other things can effect real estate prices here. To me that takes the word "Safe" out of a Real Estate Investment here, which is one good reason lost and why you buy Real Estate in the first place.

[GOLDBUGGY]

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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.

Sorry! Maybe it is just a Type-O error you made. But if you bought a Thai Property when you currency was average, then sold it after your currency got stronger, you actually lose more money and not gain. So a double whammy!

If you meant the Thai Baht got stronger after you sold then you would be correct, as with a stronger Baht you could buy back more of your dollars. But like Real Estate prices, I don't see the Thai Baht going up in price in the near future either.

[GOLDBUGGY]

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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.

That is Bang On!

My Inflation Calculator says he needed to sell this property for 1.525 M to break even and to have equal 900K from 1989.

But we can also look at it a different way. He basically stayed in his condo for 25 years for free, baring maintenance and upkeep, as he at least got his money back. So it still is a better deal then renting for 25 years. Renting is cheap here but still money lost.

[GOLDBUGGY]

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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,

Not true at all. Buy from a motivated seller and you already have your profit. I know many Thais that have made very good money buying and selling property. They tend to buy from Thais and sell to Thais. It all comes down to location. You need to buy in an area where there is enough demand at selling time. So buy where Thai people want to live. I don't think buying a condo in places like Jomtiem would provide good price appreciation, but that's just my opinion. But houses and condos in good areas tend to sell well. For the OP, I doubt he'd be able to find those areas. You need to live here, hang out with Thais, speak Thai, etc to know what's really going on.

So since you live here, obviously hang out with Thais, and I guess speak Thai, are you telling all of us here that you have made a fortune on buying and selling Real Estate in Thailand?

[Globalist]

There is no need to speak any Thai whatsoever.

Some people are successful investors, some are not.

In fact, most are not.

Edited June 1, 2014 by Globalist

[tangcoral]

I dont get it, either houses (not condos) are expensive or rent is really cheap. The ratio doesnt make sense or does it?

Anyhow now that we have some of the real estate gurus here..what are your general thoughts about the area I have circled in black, located in Chiangmai just east of the airport where the main road runs parallel and straight to hangdong, near tesco lotus to be exact. We have inherited a small piece of housing lot in and old mooban, sell now or hold for 20 years, as we do have a lot of time in our hand to hold.

What do you guys forsee in the next 15-20 year from now in this particular location? High demand or moderate demand? I see the city center being pushed down but if its going to expand eastwards I would assume moderate demand.

Edited June 13, 2014 by tangcoral

[ldnguy]

If you buy property that Thais will be interested in you can make good money. That usually means houses in Thai areas. Buy condos in farang areas or condos where too many have been built and it's not s lucrative. GF's sister bought house for 1 million 20 years ago and it's now worth 3-4 million. Well built houses in a 95% Thai area. Thais want to live there. There is more demand than supply. That's what you need to make money.

But why buy in Thailand. London prices are up 17% in last 12 months. I made my fortune investing in London property. Even a crash or to and you end up making massive amounts. Invest where you can make money. It's much harder in Thailand, though not impossible. But why make things hard for yourself. Plenty of easy money to be made in other countries.

[ldnguy]

I dont get it, either houses (not condos) are expensive or rent is really cheap. The ratio doesnt make sense or does it?

Anyhow now that we have some of the real estate gurus here..what are your general thoughts about the area I have circled in black, located in Chiangmai just east of the airport where the main road runs parallel and straight to hangdong, near tesco lotus to be exact. We have inherited a small piece of housing lot in and old mooban, sell now or hold for 20 years, as we do have a lot of time in our hand to hold.

What do you guys forsee in the next 15-20 year from now in this particular location? High demand or moderate demand? I see the city center being pushed down but if its going to expand eastwards I would assume moderate demand.

Demand will probably be much higher in 20 years, but plenty can go wrong in 20 years. No-one knows.

[ldnguy]

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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,

Not true at all. Buy from a motivated seller and you already have your profit. I know many Thais that have made very good money buying and selling property. They tend to buy from Thais and sell to Thais. It all comes down to location. You need to buy in an area where there is enough demand at selling time. So buy where Thai people want to live. I don't think buying a condo in places like Jomtiem would provide good price appreciation, but that's just my opinion. But houses and condos in good areas tend to sell well. For the OP, I doubt he'd be able to find those areas. You need to live here, hang out with Thais, speak Thai, etc to know what's really going on.

So since you live here, obviously hang out with Thais, and I guess speak Thai, are you telling all of us here that you have made a fortune on buying and selling Real Estate in Thailand?

I don't think he's saying that all. Just offering common sense advice. Generally speaking, native speakers and citizens of a country have a much better understanding of what's going on. Most people can't invest successfully even in their own country. To come to a country with a totally different language and culture makes investing even more difficult. If you didn't make money investing in property in your home country, I doubt you will make any in Thailand. It's best to stick to what you know and understand. To just turn up and start buying property in Thailand for investment is bordering on madness. Maybe ok if you're an experienced property investor, but not if you're a newbie.

You just have to look at the questions asked on here to see how naive some are. What does the OP expect? That someone will say property rises 10% a year, so he then buys any old condo and thinks he's going to get rich? I don't think people like this should be investing anywhere.

Edited June 14, 2014 by ldnguy

[ldnguy]

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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.

That is Bang On!

My Inflation Calculator says he needed to sell this property for 1.525 M to break even and to have equal 900K from 1989.

But we can also look at it a different way. He basically stayed in his condo for 25 years for free, baring maintenance and upkeep, as he at least got his money back. So it still is a better deal then renting for 25 years. Renting is cheap here but still money lost.

But he didn't stay for free because he lost use of the money. It he'd invested it he may have made 10 million in 25 years. So it could have cost him 10 million.

Many people fail to take account of what the money could have earned. For example, if I have 5 million baht in the bank earning 3% interest and use it to buy a house, I've then lost 3% a year - 150,000 a year. 5 million at 3% per annum compound interest is over 10 million. So if I bought for 5 and sold for 6 million 25 years later, it's cost me 4 million to live there. If I could have got a better return I'd be worse off. This may still be cheaper than renting. But it's not 'free' money like you claim.

[ldnguy]

I dont get it, either houses (not condos) are expensive or rent is really cheap. The ratio doesnt make sense or does it?

Rent here is very cheap compared to the price of the property.

[Robert24]

Relative to other countries you can still get a good return on investment if you rent out your condo. You get more or less 5% depending on location. This is obviously before calculating any future profit or loss on appreciation or depreciation of the value of the condo. Singapore and HK condo returns are about 2-3%.

I wouldn't recommend buying a house and renting it out. Demand for that is low in Thailand. People rent condos not houses.

I agree though with people that properties and land are at an elevated level across Thailand and if you buy now you run the risk of a price correction of your investment value for some time.

With regards to the question about the person who inherited some land in Hang Dong near Chiang Mai. My suggestion would be to keep the land, don't sell it unless you need the money. In the long run, prices in Chiang Mai will appreciate further. Chiang Mai remains a popular location for Thais and foreign investors

[Bcgardener]

Buying a house can make money in Thailand. Pay 7 million for the house then use the house as security for a 5 million Baht overdraft for your business. The interest of the overdraft is tax deductible for the business. Roll the overdraft over about 4 or 5 times a year to finance work for the business. The work makes an average 25% gross margin on each job and your way ahead and living virtually rent free. Works for me.

Sent from my GT-I9500 using Thaivisa Connect Thailand mobile app

[malcoml]

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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.

That is Bang On!

My Inflation Calculator says he needed to sell this property for 1.525 M to break even and to have equal 900K from 1989.

But we can also look at it a different way. He basically stayed in his condo for 25 years for free, baring maintenance and upkeep, as he at least got his money back. So it still is a better deal then renting for 25 years. Renting is cheap here but still money lost.

Opportunity cost.......

You are not looking at it the right way.

That money say invested in a portfolio of shares would have provided a dividend yield that pays for rent and would have achieved a far better capital appreciation.

This would have been done with a very limited risk and complete liquidity.

A quick google search should bring up some prices on household name shares and main indexes over this period.

The DOW 30 was about 2800 at the end of 1989 and just hit 17,000.

So I will say it again a poor investment...

[malcoml]

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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.

That is Bang On!

My Inflation Calculator says he needed to sell this property for 1.525 M to break even and to have equal 900K from 1989.

But we can also look at it a different way. He basically stayed in his condo for 25 years for free, baring maintenance and upkeep, as he at least got his money back. So it still is a better deal then renting for 25 years. Renting is cheap here but still money lost.

Opportunity cost.......

You are not looking at it the right way.

That money say invested in a portfolio of shares would have provided a dividend yield that pays for rent and would have achieved a far better capital appreciation.

This would have been done with a very limited risk and complete liquidity.

A quick google search should bring up some prices on household name shares and main indexes over this period.

The DOW 30 was about 2800 at the end of 1989 and just hit 17,000.

So I will say it again a poor investment...

[isaac3]

When we're talking about capital gains with regards to condos it isn't impossible however we do need to take very careful consideration about the demand and supply factors. For example currently in Chiang Mai there are many new developments that are coming up but only a few located within the prime district and looking at the outlook for the future with an increasing growth in Chinese investors the demand of these condos would only be in oversupply for probably a short period of time.

Thailand's government has already gained the support of the Chinese govt for the possibility of building a bullet train line from kunming to Chiang Mai, and are currently in discussions for the infrastructure. Thus if we look at other countries that were affected by the Chinese influence like Singapore, the demand would always be there and the prices would only go upwards.

Therefore IMHO it would be safe to say that the current oversupply would only be to supplement the incoming Chinese invasion LOL.