Visa crackdown and property prices

[3mike26]

I did a quick search but couldn't find anything,

Is there any forum discussion on the ramifications of the visa crackdown on property prices?

I'm not on the ground in LOS so can't really comment.

cheers

[Noi657]

Visa crackdown on property prices?

[ldnguy]

Won't make any difference. Most foreigners that buy property have visas to stay here. Those doig visa runs generally don't buy property. There are exceptions of course, but this affects very few people.

[Suradit69]

Won't make any difference. Most foreigners that buy property have visas to stay here. Those doig visa runs generally don't buy property. There are exceptions of course, but this affects very few people.

If anything would affect property prices it would be things like the flooding, protesters, coup etc., not a few "tourists" who are dependent on serial visa exempt entries or those who gets black listed for years of overstay.

Thais tend not to go into panic mode ...such as was the case with the recent crash of property prices in the west as people in debt up to their eyeballs bailed on their mortgages, abandoned their homes or tried to sell at major discounts in a market with no buyers ... when it comes to property prices. Thais would rather sit on a property until prices and buyers come in rather than sell at a loss as westerners like to do when in Chicken Little Mode.

Anyway Thai law factors out most of the panic buying or selling by farang when it comes to land and there should still be a growing market for condos from retiring baby boomers that will keep a floor under prices even if over-building will prevent any meaningful near term price appreciation.

Edited July 14, 2014 by Suradit69

[hhgz]

How many tourist-visa runners own property? Zero.

[PattayaPhom]

Maybe the rental rates in places like Phuket will take a small hit but the usual Thai thinking will come into play of less customers, increase prices.

[ronthai]

Agree with above "PattayaPhom", but also for other cities.

[Emster23]

Probably drive down a bit I would guess, due to supply and demand dynamics. Maybe not too many runners owned condos, but those who rented out to runners will take a hit, decide to sell, and there will be more supply than demand is my guess. Plus side is that I would assume many of the real estate sellers (esp time shares) will be greatly reduced.

[BudRight]

Those visa runners rent. Without tenants, those condos go on the market. Excess supply drives prices down.

Or not. I don't really care.

[gcgoldcoast]

property prices will take a big hit in areas where there is oversupply, like Pattaya, but best buys are when someone has to leave and is in a hurry, same as with cars

[NomadJoe]

It won't effect property, but it will effect the cheap rental bungalow prices or cheap rental condos and apartments, as this is the most common choice of accommodations for serial visa runners.

Edited July 15, 2014 by NomadJoe

[Maejo Man]

Agree with above "PattayaPhom", but also for other cities.

My landlady has had a couple of properties vacant for aout 4 months. cosequently she is about 120,000 out of pocket. She sent me a letter the other day informing me that as of September my rent would increase by approximately 60%

In answer to the OP's question, I think that new house sales will be hardly be affected, but wental properties certainy will, and it will get worse. as short term renters vacate.

[bkkjames]

Agree with above "PattayaPhom", but also for other cities.

My landlady has had a couple of properties vacant for aout 4 months. cosequently she is about 120,000 out of pocket. She sent me a letter the other day informing me that as of September my rent would increase by approximately 60%

In answer to the OP's question, I think that new house sales will be hardly be affected, but wental properties certainy will, and it will get worse. as short term renters vacate.

with a 60% increase I imagine she'll be more out of pocket for months and years ahead - hopefully.

[TTom911]

Won't make any difference. Most foreigners that buy property have visas to stay here. Those doig visa runs generally don't buy property. There are exceptions of course, but this affects very few people.

Admitted, I also don't have a crystal bowl either , but most replies along the lines "it has no effect" are very simplistic and naive, I believe. Things are a little more complex:

1. MANY Thais who buy property as "investment" are over-indebted. They buy on loans and in a high property price level.

2. in places, like Phuket and other areas which will see an exodus of "long-term tourists", the rental market will get a serious hit with large numbers of "tourists" having to leave because of the new visa handling

3. this will get a lot of these over-indebted Thai property owners who need the rental income to pay their monthly dues into trouble. As said, many are financially on the edge already; even more so with "under-the-table revenues" under attack...

4. the logic consequence would be that there will be quite a few emergency sales in some places, which WILL hit the property price for some sort of properties ("mid-quality", not so much on the hight end, I guess)

5. It will also affect the rate by which properties under development will be snapped up (again, mostly for "mid-quality" properties, not so much on the hight end, I guess)

6. As I hear from some banks, no surprise, they get stricter on property mortgage approvals already, which of course also reduces the buyer market, which will affect the property price level

7. All in all, I believe this will be in some significant parts of the market a bigger problem than portrayed here. It will be a "cooling of a bubble" in some segments of the market", and we saw how that tastes ...

[BudRight]

Agree with above "PattayaPhom", but also for other cities.

My landlady has had a couple of properties vacant for aout 4 months. cosequently she is about 120,000 out of pocket. She sent me a letter the other day informing me that as of September my rent would increase by approximately 60%

In answer to the OP's question, I think that new house sales will be hardly be affected, but wental properties certainy will, and it will get worse. as short term renters vacate.

What a stupid woman. Now you'll move and she'll be out much more.

[TTom911]

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Agree with above "PattayaPhom", but also for other cities.

My landlady has had a couple of properties vacant for aout 4 months. cosequently she is about 120,000 out of pocket. She sent me a letter the other day informing me that as of September my rent would increase by approximately 60%

In answer to the OP's question, I think that new house sales will be hardly be affected, but wental properties certainy will, and it will get worse. as short term renters vacate.

What a stupid woman. Now you'll move and she'll be out much more.

"Thai logic"... let's hope the market makes those "landlord morons" learn a lesson... up to the tenant if or if not to accept such stupidity...

[khunPer]

Won't have any impact – those buying property and not the same people as doing visa runs...

[TTom911]

Won't have any impact – those buying property and not the same people as doing visa runs...

Very simplistic view. Many of those Thai who finance their property via a mortgage in a hope to pay the mortgage via rental income WILL be in trouble and there will be emergency sales, no doubt... and that WILL drive the price down.

The deciding factor is "how many of such properties are bank financed". The bigger that portion of the market is the more the market will be affected and the price for those properties will go down... Those who don't sit on a mortgage will feel the pain still, but they might "sit and wait"...

[Suradit69]

Maybe the rental rates in places like Phuket will take a small hit but the usual Thai thinking will come into play of less customers, increase prices.

"...but the usual Thai thinking will come into play ..."

Yes, if only Thais would run around like Chicken Littles, abandoning property, trying desperately to sell/rent at enormous losses, etc like farang have done in the real estate crisis in the west that would demonstrate superior economic thinking.

Superior usual farang thinking

[khunPer]

Won't have any impact – those buying property and not the same people as doing visa runs...

Very simplistic view. Many of those Thai who finance their property via a mortgage in a hope to pay the mortgage via rental income WILL be in trouble and there will be emergency sales, no doubt... and that WILL drive the price down.

The deciding factor is "how many of such properties are bank financed". The bigger that portion of the market is the more the market will be affected and the price for those properties will go down... Those who don't sit on a mortgage will feel the pain still, but they might "sit and wait"...

Not too sure it will have any impact, however you may be right and over time we will know...

[TheFishman1]

Thai People that own property set there own price if a house sit empty they don't lower the price. Go figure

[TTom911]

it will affect a certain market. Those mid-level quality, "me too" developments with little distinguishing factors, I would think also many of these shop-houses being built everywhere in Phuket, all these areas are oversupplied, I believe.

If the owner of such properties sits on a mortgage he/she hopes to pay via rental income... "good luck"... many of those owners will have to sell and have to discount heavily... as said, the question is how big this segment of the market is... the bigger this "troubled segment", the more it will affect the property prices fore these types of properties...

[Maejo Man]

Agree with above "PattayaPhom", but also for other cities.

My landlady has had a couple of properties vacant for aout 4 months. cosequently she is about 120,000 out of pocket. She sent me a letter the other day informing me that as of September my rent would increase by approximately 60%

In answer to the OP's question, I think that new house sales will be hardly be affected, but wental properties certainy will, and it will get worse. as short term renters vacate.

with a 60% increase I imagine she'll be more out of pocket for months and years ahead - hopefully.

Yes she will as I have already made plans to move, but naturally will not tell her till the last possible moment. Having paid 2.5 million baht over the last 22 years, I thought she would have been more than happy with a stable tennant. However, TIT

[JohnP1752]

Martial law has had a bigger impact on the property market than banning a few visa runners. Some people don't like the army walking around with guns to control order. Lots of new building projects are stalled in tourist areas due to a shortage of Cambodian workers also. The impact is isolated to tourist areas as Bangkok is still selling OK.

Visa runners are a small percentage of people mainly in the rental market.

If mortgage holders do default on a few properties in Tourist areas, because of loss of income, then it will likely have no flow on effect to the real market as it takes Thai banks years before they are able to force a sale due to a default on a property purchase.

[TTom911]

Agree with above "PattayaPhom", but also for other cities.

My landlady has had a couple of properties vacant for aout 4 months. cosequently she is about 120,000 out of pocket. She sent me a letter the other day informing me that as of September my rent would increase by approximately 60%

In answer to the OP's question, I think that new house sales will be hardly be affected, but wental properties certainy will, and it will get worse. as short term renters vacate.

with a 60% increase I imagine she'll be more out of pocket for months and years ahead - hopefully.

Yes she will as I have already made plans to move, but naturally will not tell her till the last possible moment. Having paid 2.5 million baht over the last 22 years, I thought she would have been more than happy with a stable tennant. However, TIT

TIT, as you say... Seems your landlord is sitting on a stag of cash and hence he / she will not budge.

I saw that in many other cases, not only property related. Thai people with some cash in the pocket would happily loose money if they just can stick stubbornly to their "I want it my way or no way" mentality...

In terms of business sense completely ridiculous, but........TIT....... will not change in a million years....Let them be happy with that...

Edited July 15, 2014 by TTom911

[Thai Travel Bug]

I am a condo owner in Pattaya, and I don't believe that we will see price drops. I have always rented my condo out, by luck and not good management to persons on a retirement visa. I have 2 good quality condo's in good complexes, and almost all in these complexes are owner/users, with some used as investment properties. Many of the owner/user condos sit empty for months at a time, used only 2 or 3 times a year by their owners. Cheap Charlie 5 to 7,000 baht a month squats, and long term rooms in guest houses may be effected, and we may well see the amount of condo's being built reduced, but I don't see stricter visa regulations being enforced as a tool to driving down prices.

[Eliot Rosewater]

Maybe the rental rates in places like Phuket will take a small hit but the usual Thai thinking will come into play of less customers, increase prices.

"...but the usual Thai thinking will come into play ..."

Yes, if only Thais would run around like Chicken Littles, abandoning property, trying desperately to sell/rent at enormous losses, etc like farang have done in the real estate crisis in the west that would demonstrate superior economic thinking.

Superior usual farang thinking

Your smug response fails to take into account high property taxes and municipal fees which don't apply here; not to mention a guilded land owning class here compared to middle class property owners in the west

What a load of sanctimonious crap......

Sent from my GT-I9300T using Thaivisa Connect Thailand mobile app

[Carioca]

I know many expats living here 6-12 months a year on tourist visas. Most have the means but not age requirement for retirement visa. These folks are not deadbeats at all, they just have earned or inherited too much money too early in life.

[mrfaroukh]

Property is = to demand and supply. Too many buildings coming up means increase in prices is = bubble

[peterb17]

No the crackdown will really have no effect.

I read in one of the freebie property guides in Pattaya ( even if there was world war three with nukes going off- the property investment in Pattaya is just truly fabulous! ) there were 70 condo developments on the go.

Property prices in Pattaya, Jomtien etc are going down- rental is cheaper. Even now there are thousands of properties for sale and for rent.

IF and when all these massive developments are finished, it's going to be oversupply that's going to push down prices.

One of them I can see in the distance from my balcony has seven vast buildings- have not seen much activity- cranes not working.