Pattaya condo market shrinks 60 percent in first half

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Pattaya condo market shrinks 60% in first half
The Nation


About 3,800 units were launched in the first six months

Property takes direct hit from political turmoil

PATTAYA: -- The Pattaya condominium market shrunk 60 per cent in the first half of the year due to the effects of the political problems in Thailand, according to the Pattaya Condominium Market Research Report released by Colliers International Thailand.

Surachet Kongcheep, associate director of research at Colliers International, said about 3,800 units were launched in the first six months - about 60 per cent lower than in the second half of 2013.

Surachet said the number of new condominium units launched in first half of the year was significantly lower than second half of 2013 - except in Jomtien area, which was 48 per cent higher.

The political situation in the fourth quarter of 2013 and the first five months of 2014 directly affected the entire property market, including Pattaya city.

"There are more than 28,200 condominium units under construction in Pattaya city that are expected to be completed in second half of 2014," he said. "Nearly 18,850 units are scheduled to be completed in the second half of 2014 in Jomtien, and approximately 4,290 more in 2015.

"Other locations have dramatically lower figures than Jomtien, because many large condominium projects [some with more than 1,000 units] have been launched in Jomtien in the past few years."

Surachet said the average take-up rate in the condominium market in Pattaya was still similar to the past few years.

He said the figure at the end of the first half of 2014 was approximately 73 per cent, a little higher than the previous six months.

This was due to the political situation, which had affected the consumer confidence of Thais, who postponed purchasing new property in the last quarter of 2013 and the first few months of 2014 across all locations in Thailand.

Many foreign countries had also warned their people about travelling to Thailand during the political unrest, and the juntas had not cancelled martial law. This also affected the confidence of foreign tourists.

Surachet said that all these issues directly affected the condominium market in Pattaya.

He said many foreigners bought a condo in Pattaya as a second home, while Thais chiefly bought a condo as a second home, an investment and a residence while working in Pattaya or nearby.

Many condominium projects had been launched in the past three years and some were still available.

This was another factor impacting on the market, because buyers had a lot of choice and could take more time before making a decision.

"Local Thais and foreign developers and big names from Bangkok are trying to attract more buyers through marketing campaigns such as a guaranteed yield in one to three years, which has attracted a lot of buyers," Surachet said.

He said the average selling price of a condo launched in the first half of 2014 was approximately Bt62,000 per square metre - similar to the price in the second half of 2013.

Source: http://www.nationmultimedia.com/business/Pattaya-condo-market-shrinks-60-in-first-half-30242827.html


-- The Nation 2014-09-09

[shirtless]

I think developers need to look at the world economy , and limit developments accordingly.

[morrobay]

This ponzi/condo train is going over a cliff.because developers cannot stop and have not limited development in accord with world and local economy. Enter the black swan.

There is a confluence of independent events in play here Russians stop buying at the bottom of the pyramid.

Household debt for Thais is out of control..Gross over supply,.Speculators cannot pay back loans because they cannot sell. This will create a cascade of sellers.

The downward vortex is underway. This house of cards can no longer defy the laws of supply and demand.

Edited September 9, 2014 by morrobay

[laurentbkk]

Is it really because of political turmoil ????? Or maybe people really got bored with pattaya ..

[LennyW]

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This ponzi/condo train is going over a cliff.because developers cannot stop and have not limited development in accord with world and local economy. Enter the black swan.

There is a confluence of independent events in play here Russians stop buying at the bottom of the pyramid.

Household debt for Thais is out of control..Gross over supply,.Speculators cannot pay back loans because they cannot sell. This will create a cascade of sellers.

The downward vortex is underway. This house of cards can no longer defy the laws of supply and demand.

Is it really because of political turmoil ????? Or maybe people really got bored with pattaya ..

This statement would suggest actual purchases are on the increase.

Surachet said the average take-up rate in the condominium market in Pattaya was still similar to the past few years.
He said the figure at the end of the first half of 2014 was approximately 73 per cent, a little higher than the previous six months.

It is just the number of units launched that has decreased, but who knows for sure? it's all smoke and mirrors when it comes to condos in Pattaya and Jomtien.

[ezzra]

And yet, they keep on building like there is no tomorrow and that the whole of Russia,

China and other countries will be buying condos there, I foresee a super humongous

slump in the very near future in Pattaya RE, the smallest problem/scare there will

the RE market tumbling down like a bolder of a mountain...

[waynethor]

And yet, they keep on building like there is no tomorrow and that the whole of Russia,

China and other countries will be buying condos there, I foresee a super humongous

slump in the very near future in Pattaya RE, the smallest problem/scare there will

the RE market tumbling down like a bolder of a mountain...

Which in Thai business logic will send prices soaring upward.

[LennyW]

And yet, they keep on building like there is no tomorrow and that the whole of Russia,

China and other countries will be buying condos there, I foresee a super humongous

slump in the very near future in Pattaya RE, the smallest problem/scare there will

the RE market tumbling down like a bolder of a mountain...

Which in Thai business logic will send prices soaring upward.

The article states that new launches are on the decrease yet uptake remains the same or even higher that the previous six months, so surely this would mean that there will be a lack of condos available thereby raising the demand and consequently the prices?

[petercool]

Pattaya bashing and off topic post removed

[Naam]

And yet, they keep on building like there is no tomorrow and that the whole of Russia,

China and other countries will be buying condos there, I foresee a super humongous

slump in the very near future in Pattaya RE, the smallest problem/scare there will

the RE market tumbling down like a bolder of a mountain...

i foresee to see postings like yours for years to come as i saw them for the last eight years. not limited to Pattaya real estate but also the Thai economy as well as the Baht falling into an abyss "like a boulder off a mountain".

keep up the good job amusing me

[KittenKong]

Crikey! They've finished the marina and demolished the Waterfront.

I really must get out more.

[phantomfiddler]

I recently heard of one condo building that was putting up 2Bedroom, 2 Bathroom units for 6 million Baht in an astounding area of 50 sq, mtrs ! Who would want to live in that, I ask myself ? You would have to exchange the proverbial swinging cat for a swinging gerbil

[Naam]

I recently heard of one condo building that was putting up 2Bedroom, 2 Bathroom units for 6 million Baht in an astounding area of 50 sq, mtrs ! Who would want to live in that, I ask myself ? You would have to exchange the proverbial swinging cat for a swinging gerbil

i'd feel lost in a huge unit of 50m².

[Thakkar]

Without reliable data on transaction volume (actual sales, and not smoke and mirrors), transaction prices (actual, not headline prices), vacancy rates, approvals granted for future developments, details of overall infrastructure plans and reasonably accurate completion dates, it is impossible to have any meaningful idea as to where the market is headed, where it now stands, and sometimes even, where it's been.

If you need it, indeed to use it, don't mind being locked to one location and can't find better investment options, buy. If not, don't.

T

[ttthailand]

28,200 additional units just in Pattaya by end if year ??? is that correct ? If so, that's a lot of units to add to the ones sitting empty right now.

[Deli]

Easy Visas and clear rights for foreign might help to sell

[Bernard Flint]

Is it really because of political turmoil ????? Or maybe people really got bored with pattaya ..

The cheap charlies, border runners, ed scammers, go to cheaper places like cambodia, phillipines, says a lot doesnt it

[Sigurris]

You can't make more land so the building will stop. But Pattaya will still be the most accessible resort to BKK and Suvarnabhumi. And as everyone knows Location is everything. One day things will change in Thailand and I see Pattaya becoming the Thai Macau. When that happens the market will explode.

I reckon 5 years. No I am not an Estate agent.

[terryp]

lets be honest: who really cares ..anyone that is stupid enough to pass ANY money into thailand as an investment is well .....

[Asiantravel]

And yet, they keep on building like there is no tomorrow and that the whole of Russia,

China and other countries will be buying condos there, I foresee a super humongous

slump in the very near future in Pattaya RE, the smallest problem/scare there will

the RE market tumbling down like a bolder of a mountain...

i foresee to see postings like yours for years to come as i saw them for the last eight years. not limited to Pattaya real estate but also the Thai economy as well as the Baht falling into an abyss "like a boulder off a mountain".

keep up the good job amusing me

Your post implies you disagree with ezzra.

What factors do you believe will enable the Pattaya condo market to avoid the phenomena ezzra refers to? Not about the " Thai economy and the Baht " because that is not the subject of this thread. I am referring specifically to your interpretation of the supply and demand of condominiums in Pattaya.

[Gunna]

And yet, they keep on building like there is no tomorrow and that the whole of Russia,

China and other countries will be buying condos there, I foresee a super humongous

slump in the very near future in Pattaya RE, the smallest problem/scare there will

the RE market tumbling down like a bolder of a mountain...

Which in Thai business logic will send prices soaring upward.

The article states that new launches are on the decrease yet uptake remains the same or even higher that the previous six months, so surely this would mean that there will be a lack of condos available thereby raising the demand and consequently the prices?

Especially as Thais and several other nationalities like to buy brand new condos, so the developers have a continuous market of buyers. It may get harder to sell 2nd hand condos for a while, but as most older ones are much larger than many of the shoe box sized new condos, many buyers will see value for money in buying a larger 2nd hand condo.

[Asiantravel]

You can't make more land so the building will stop. But Pattaya will still be the most accessible resort to BKK and Suvarnabhumi. And as everyone knows Location is everything. One day things will change in Thailand and I see Pattaya becoming the Thai Macau. When that happens the market will explode.

I reckon 5 years. No I am not an Estate agent.

" One day things will change in Thailand and I see Pattaya becoming the Thai Macau. When that happens the market will explode."

But how can a market “explode “ anywhere unless the current trend of real incomes declining is reversed? Consumers are already tapped out with debt everywhere.

How and where do you see people's incomes rising enough to be able to take on these added expenses?

And other than Thai buyers, from which countries do you see the other buyers coming from that will contribute to this “explosion” you are expecting?

Edited September 9, 2014 by Asiantravel

[bkkjames]

As I see it the one thing that Pattaya has in it's favor is Bangkok.

[12DrinkMore]

As often in these articles I have difficulty in following the numbers.

"(Kongcheep) said about 3,800 units were launched in the first six months"

Compared to 47,000 scheduled to be completed in the last six months.

"There are more than 28,200 condominium units under construction in Pattaya city that are expected to be completed in second half of 2014," he said. "Nearly 18,850 units are scheduled to be completed in the second half of 2014 in Jomtien".

[Likener1]

"Pattaya condo market shrinks 60 percent in first half"

As new condo sizes are - perhaps some correlation between these issues ?

The smallest units I've heard of are 24 sqm. - I cannot see that is either a liveable size or even a potential investment, surely better in a hotel for a short term rental.

Edited September 9, 2014 by Likener1

[lostmebike]

So sales are down 60% in Patts but up nearly 50% in Jomtien. Maybe the sex-pests are going up market now!

[bkkjames]

Pattaya condo market shrinks 60 percent in first half

As new condo sizes are - perhaps some correlation between these issues ?

The smallest units I've heard of are 24 sqm.

really, who buys a 24 sq meter condo? one would have to go outside just to change his mind. My master bath is 24 square meters and I wouldn't want to eat, sleep in there either.

[LennyW]

So sales are down 60% in Patts but up nearly 50% in Jomtien. Maybe the sex-pests are going up market now!

You need to read the article again, new launches are down but sales in Pattaya are up slightly.

[chakatee]

Pattaya condo market shrinks 60 percent in first half

As new condo sizes are - perhaps some correlation between these issues ?

The smallest units I've heard of are 24 sqm.

really, who buys a 24 sq meter condo? one would have to go outside just to change his mind. My master bath is 24 square meters and I wouldn't want to eat, sleep in there either.

right, I also wouldn't want to eat in your bathroom

[Don Aleman]

The condo market here in Pattaya has been shrinking for quite some time, in spite, of the fact developers continue to build. There is a glut which I believe will worsen as buyers look more closely at the city itself - a shambles, and not just the very nice properties available.