Land Values

[cottonpusher]

Wondering if anybody knows how I can obtain a land valuation on some property I have in Patong?

[NamKangMan]

Too many out of line sales here to get an accurate valuation of land and property.

Also, not many properties moving, so difficult to get comparative sales.

Besides, how do you value something you can't own?

Edited November 28, 2014 by NamKangMan

[stevenl]

Too many out of line sales here to get an accurate valuation of land and property.

Also, not many properties moving, so difficult to get comparative sales.

Besides, how do you value something you can't own?

Of course people can own land.

[gerry123]

maybe try the same source as you used when you first purchased the property /land

[LivinginKata]

There is no official register of recent price paid for land. It's all word of mouth, rumour, and the flavour of the day.

People selling land talk up the price, those that have recently sold talk up the price they were actually were paid.

It's all a figment of some one's imagination.

At the end of the day you pay if you consider the price in your budget and if the land meets your
expectations.

I speak with some experience over the years. We (wife or company - for the sake of NKM ) have bought various plots of land here in Phuket and Petchaburi.

[NamKangMan]

Too many out of line sales here to get an accurate valuation of land and property.

Also, not many properties moving, so difficult to get comparative sales.

Besides, how do you value something you can't own?

Of course people can own land.

True.

Allow me to clarify. "How does a foreigner in Thailand value land he/she can't own?"

[NamKangMan]

Also, it must be noted, the concept of "highest and best use" of land here is not so prevalent, due to the lack of town planning laws, and corruption here.

[DaveHKT]

CP, the very best of luck in your endeavors to find someone qualified in the 'black art' of land valuation, I don't believe such a 'beast' exists around here.

Based on what I have observed over my few years in Patong I think the rule of thumb in placing a value (per Rai) of any plot of land here is as follows:

A) Think of a number between 5 & 10;

Apply 50% for contingencies;

C) Then multiply the total by one million;

D) Add a further two zeros to the number obtained in C) and voila you have your number.

Ooops, nearly forgot, once you have a total for D) don't forget to double the number.

OK, the above sounds silly but no more sillier than some of the prices asked for land in our fair town. Mind you, there will always be someone wanting to grab a piece of the action here.

Once again, best of luck in your search. If I hear of a qualified land valuation expert I will forward their details to you.

Regards

[steelepulse]

Banks have a reasonable idea of land prices, since they inevitably fund a lot of the purchases. I wonder if you applied for a loan you'd get a free appraisal ?

Edited November 28, 2014 by steelepulse

[LivinginKata]

Banks have a reasonable idea of land prices, since they inevitably fund a lot of the purchases. I wonder if you applied for a loan you'd get a free appraisal ?

You think that 'corruption' does not apply to the bank land valuators. We have applied for a loan on a land purchase and it was an interesting experience. How much you need ... wink wink .. nudge nudge.

[Sharp]

Banks value is probably the best option although it's usually on the low side according to the Seller.....

[NamKangMan]

CP, the very best of luck in your endeavors to find someone qualified in the 'black art' of land valuation, I don't believe such a 'beast' exists around here.

Based on what I have observed over my few years in Patong I think the rule of thumb in placing a value (per Rai) of any plot of land here is as follows:

A) Think of a number between 5 & 10;

Apply 50% for contingencies;

C) Then multiply the total by one million;

D) Add a further two zeros to the number obtained in C) and voila you have your number.

Ooops, nearly forgot, once you have a total for D) don't forget to double the number.

OK, the above sounds silly but no more sillier than some of the prices asked for land in our fair town. Mind you, there will always be someone wanting to grab a piece of the action here.

Once again, best of luck in your search. If I hear of a qualified land valuation expert I will forward their details to you.

Regards

I think a simple formula would be to find similar houses to what you are considering building, then, see what they are renting for, per year.

Multiply that amount by 30 years, which is the maximum you can lease the land for here. (wife and/or company structure aside) No - there are no 30 x 30 x 30 leases - they don't exist at Thai Law.

Allow a little on this amount for capital gain, year on year. I say a little, because a capital gain can not be relied upon here, and the cost of maintanace and repair, due to poor constuction techniques, will diminish you capital gain. It must also be noted that once you have purchased, you will find it difficult to ever sell, so, any capital gain is not so easy to cash in on here.

Add the land price, and the total cost of your construction together. It should be close to the 30 years total of renting a similar property here.

Rents do not increase a lot here. My rent hasn't changed in 2 years, and if anything, rents may decrease on Phuket, due to an oversupply.

I think you may find a big disparity between my formula, and the asking price and construction cost, and that difference is called "the rip off price."

[stevenl]

CP, the very best of luck in your endeavors to find someone qualified in the 'black art' of land valuation, I don't believe such a 'beast' exists around here.

Based on what I have observed over my few years in Patong I think the rule of thumb in placing a value (per Rai) of any plot of land here is as follows:

A) Think of a number between 5 & 10;

Apply 50% for contingencies;

C) Then multiply the total by one million;

D) Add a further two zeros to the number obtained in C) and voila you have your number.

Ooops, nearly forgot, once you have a total for D) don't forget to double the number.

OK, the above sounds silly but no more sillier than some of the prices asked for land in our fair town. Mind you, there will always be someone wanting to grab a piece of the action here.

Once again, best of luck in your search. If I hear of a qualified land valuation expert I will forward their details to you.

Regards

I think a simple formula would be to find similar houses to what you are considering building, then, see what they are renting for, per year.

Multiply that amount by 30 years, which is the maximum you can lease the land for here. (wife and/or company structure aside) No - there are no 30 x 30 x 30 leases - they don't exist at Thai Law.

Allow a little on this amount for capital gain, year on year. I say a little, because a capital gain can not be relied upon here, and the cost of maintanace and repair, due to poor constuction techniques, will diminish you capital gain. It must also be noted that once you have purchased, you will find it difficult to ever sell, so, any capital gain is not so easy to cash in on here.

Add the land price, and the total cost of your construction together. It should be close to the 30 years total of renting a similar property here.

Rents do not increase a lot here. My rent hasn't changed in 2 years, and if anything, rents may decrease on Phuket, due to an oversupply.

I think you may find a big disparity between my formula, and the asking price and construction cost, and that difference is called "the rip off price."

Ah, so land should be sold cheaper to foreigners since they can only have a lease for 30 years, as compared to Thais and companies who can fully own the land. Interesting concept.

[NamKangMan]

CP, the very best of luck in your endeavors to find someone qualified in the 'black art' of land valuation, I don't believe such a 'beast' exists around here.

Based on what I have observed over my few years in Patong I think the rule of thumb in placing a value (per Rai) of any plot of land here is as follows:

A) Think of a number between 5 & 10;

Apply 50% for contingencies;

C) Then multiply the total by one million;

D) Add a further two zeros to the number obtained in C) and voila you have your number.

Ooops, nearly forgot, once you have a total for D) don't forget to double the number.

OK, the above sounds silly but no more sillier than some of the prices asked for land in our fair town. Mind you, there will always be someone wanting to grab a piece of the action here.

Once again, best of luck in your search. If I hear of a qualified land valuation expert I will forward their details to you.

Regards

I think a simple formula would be to find similar houses to what you are considering building, then, see what they are renting for, per year.

Multiply that amount by 30 years, which is the maximum you can lease the land for here. (wife and/or company structure aside) No - there are no 30 x 30 x 30 leases - they don't exist at Thai Law.

Allow a little on this amount for capital gain, year on year. I say a little, because a capital gain can not be relied upon here, and the cost of maintanace and repair, due to poor constuction techniques, will diminish you capital gain. It must also be noted that once you have purchased, you will find it difficult to ever sell, so, any capital gain is not so easy to cash in on here.

Add the land price, and the total cost of your construction together. It should be close to the 30 years total of renting a similar property here.

Rents do not increase a lot here. My rent hasn't changed in 2 years, and if anything, rents may decrease on Phuket, due to an oversupply.

I think you may find a big disparity between my formula, and the asking price and construction cost, and that difference is called "the rip off price."

Ah, so land should be sold cheaper to foreigners since they can only have a lease for 30 years, as compared to Thais and companies who can fully own the land. Interesting concept.

Please show me where I said that land here should be sold cheaper to foreigners.

Firstly, I am under the belief that a Thai Company, set up for the sole purpose of purchasing land, is illegal. I am happy to stand corrected on this, if I am wrong.

I was under the impression LIK has businesses here, which are accommodation based, so, a Thai Company to own the land upon which his business operates, would be fine.

"The market" sets the price of land. When a willing buyer agrees on the price with a willing seller, one who is not is distress, in general, there becomes the "market value" of the land and/or or property.

With any investment, there is a risk versus reward profile. That said, how many times on this forum do hear words similar to, "I'll be living in it myself, until I die, so I don't care if it increases in value, or not." For an individual thinking about this scenario, I suggest they consider my basic formula, otherwise, they would be better renting, not to mention, one may die soon after the purchase.

As a foreigner can not own land, 100% freehold here, their risk is significantly higher than a Thai, and quite simply, it's a lower form of ownership, and common sense suggests that should be reflected in the price a foreigner is willing to pay for land/property here.

There's nothing stopping Thai's entering the property market here, but I doubt it's the Thai's driving the property market on Phuket.

The seller will sell to whoever offers the best price, but it's interesting that foreigners will pay a premium, and in some cases, a ridiculous amount, possibly based on their emotions, rather than the deal being financially sound, when their ownership is much much less than that of a Thai citizen.

Edited November 28, 2014 by NamKangMan

[glassdude007]

can you not access the value of the land by how much property tax is paid on the parcel?

The town assessors value of the property that the tax to be paid amount is based on?

[Shot]

^^You could, but that would be based on the registered or appraised value, which is open to manipulation. Wink, wink.

Wasn't there a recent article about corruption in Thailand, and the Land Office was at the top of the list?

[hansgruber]

Have to laugh at NKM giving real estate advice.

Give it up you studio room renter.

[NamKangMan]

Have to laugh at NKM giving real estate advice.

Give it up you studio room renter.

I rent a nice apartment, actually.

I rent by choice. Main reasons, foreigners can't own land here, it's an unstable country, I'm under 50 years of age, poor construction methods and Phuket is overpriced.

Let me guess, you bought in because your missus said it was a good idea.

Happy to hear how you valued your property, Hans.

Edited November 28, 2014 by NamKangMan

[hansgruber]

Have to laugh at NKM giving real estate advice.

Give it up you studio room renter.

I rent a nice apartment, actually.

I rent by choice. Main reasons, foreigners can't own land here, it's an unstable country, I'm under 50 years of age, poor construction methods and Phuket is overpriced.

Let me guess, you bought in because your missus said it was a good idea.

I bought because I wanted a home that I could make comfortable and stable for my children. Not in fear of being tossed out or rent increased.

I have children who are thai, all the land goes in their name and they hold it legally.

I'm the legal guardian and I hold the titles for them so I'm in control. Once they hit a sensible age they can have at it.

See how people's circumstances are different to yours? Your advice is only applicable to single bar hopping aging playboys so I agree, keep renting if that's your lifestyle.

You will definitely get scammed out of property living that random.

[NamKangMan]

Have to laugh at NKM giving real estate advice.

Give it up you studio room renter.

I rent a nice apartment, actually.

I rent by choice. Main reasons, foreigners can't own land here, it's an unstable country, I'm under 50 years of age, poor construction methods and Phuket is overpriced.

Let me guess, you bought in because your missus said it was a good idea.

I bought because I wanted a home that I could make comfortable and stable for my children. Not in fear of being tossed out or rent increased.

I have children who are thai, all the land goes in their name and they hold it legally.

I'm the legal guardian and I hold the titles for them so I'm in control. Once they hit a sensible age they can have at it.

See how people's circumstances are different to yours? Your advice is only applicable to single bar hopping aging playboys so I agree, keep renting if that's your lifestyle.

You will definitely get scammed out of property living that random.

"Your advice is only applicable to single bar hopping aging playboys so I agree, keep renting if that's your lifestyle." - so now my advice is "applicable" to some. Just one post ago, it wasn't.

"You will definitely get scammed out of property living that random." - how so?

How did you value the property you bought?

[hansgruber]

Have to laugh at NKM giving real estate advice.

Give it up you studio room renter.

I rent a nice apartment, actually.

I rent by choice. Main reasons, foreigners can't own land here, it's an unstable country, I'm under 50 years of age, poor construction methods and Phuket is overpriced.

Let me guess, you bought in because your missus said it was a good idea.

I bought because I wanted a home that I could make comfortable and stable for my children. Not in fear of being tossed out or rent increased.

I have children who are thai, all the land goes in their name and they hold it legally.

I'm the legal guardian and I hold the titles for them so I'm in control. Once they hit a sensible age they can have at it.

See how people's circumstances are different to yours? Your advice is only applicable to single bar hopping aging playboys so I agree, keep renting if that's your lifestyle.

You will definitely get scammed out of property living that random.

"Your advice is only applicable to single bar hopping aging playboys so I agree, keep renting if that's your lifestyle." - so now my advice is "applicable" to some. Just one post ago, it wasn't.

"You will definitely get scammed out of property living that random." - how so?

How did you value the property you bought?

Value isn't something that's on my mind constantly and didn't buy to make money or invest.

I don't expect you to understand that because you have zero experience in Phuket real estate and don't have children. I'd be wasting more of my time going into details because you'll just counter it with more unexperienced blah blah.

Why not just leave this thread for those who actually know something due to experience, not what you've read on thaivisa over the years.

Your opinion means nothing to be honest.

[Sharp]

Personally I get a bank valuation which I have already said is 'classed' as low end value, that's my benchmark for negotiations with the Seller and then get to a value I'm happy with or pull out. Just my method which has served me well over the years. It's definitely a tricky Road...

[NamKangMan]

@ hansgruber

"Value isn't something that's on my mind constantly and didn't buy to make money or invest." - surely you bought the place based on the price you were prepared to pay, being a reasonable reflection of the land size and location, and the quality and size of the house built on it. Or, did you just pay whatever the owner wanted?

"I don't expect you to understand that because you have zero experience in Phuket real estate and don't have children." - I do have children, but they are adult, and not in Thailand.

Are you suggesting having young children on Phuket is, or should be, the main motivation for buying property here? Can't single, or a coupled up foreigner buy property as well? Aren't the same principles involved?

I have a small property portfolio, across different countries, and on different continents. I selected, paid for, and have lived in them all. Whilst you are correct in saying I have no experience in real estate on Phuket, you are incorrect in saying I have no experience in real estate, in general.

"Why not just leave this thread for those who actually know something due to experience" - the OP asked for valuers, or how to have land valued. Rightly or wrongly, I have presented a basic formula for the OP to consider.

What have you contributed to the thread, other than to ridicule me, and you are the one with "experience" in real estate here.

Why can't you just post how you formed the opinion that the price you paid for your house was a reasonable price that reflected the land size and location, and the building size and quality that sits upon it? Want not share your "experience?"

"Your opinion means nothing to be honest." - well, it's an anonymous internet forum. I can assure you, your opinion holds the same weight as mine - "nothing" - but at least I have posted an opinion on how to appraise land/property here.

I never suggested my opinion should be the only method of valuation here, but just a method to consider, or to throw in the mix and cross reference with other methods.

Maybe members could learn something from your vast "experience" in real estate here, Hans.

[hansgruber]

More about nothing NKM.

Happy to discuss this topic with actually land buyers but not with tirekickers looking to discredit the island at every turn.

Either discuss land values of Patong or step away from your keyboard.

[cottonpusher]

Thank you to the people that actually contributed some useful ideas.

NKM & Hans please agree to disagree! we all have opinions.

Some properties are easy to value I have brought and sold a number here in Thailand over the years without a hitch but this particular property is difficult to put a number on as not much to compare it with on sale.

I have a bank value on it but it seems very low which makes sense, the land office were higher than the bank but still does not give you the actual market value for a property of this type/location anyway now at least I have a start point so thanks again for the advice.

Side note:

I have lived here for over 30 years, married for 29yrs (still married), these 2 houses I brought 28 years ago it was one of the very early residential developments in Patong before Rat-uthit road existed even had sea & mountain views at one point….

Thailand real estate has been very good to me over the years & I have had no issue not being the 100% land owner, due diligence, a good Bangkok lawyer & accountant is essential to structure it in your favour it can be done in a secure manner just don't try and take the short cuts to save a dime as in the long run you will loose $dollars.

[NamKangMan]

More about nothing NKM.

Happy to discuss this topic with actually land buyers but not with tirekickers looking to discredit the island at every turn.

Either discuss land values of Patong or step away from your keyboard.

A disappointing reply Hans. I expected more from you. Even more ridicule and abuse would have been entertaining on a slow forum day. Try harder next time.

Edited November 29, 2014 by NamKangMan

[stevehaigh]

its worth what someone is willing to pay for it. is anything selling in Phuket these days? i'd be interested to hear from a real real estate agent about sales over the last 6 months or so but of course few people would be willing to say the truth in public for fear of driving the market down

[hansgruber]

its worth what someone is willing to pay for it. is anything selling in Phuket these days? i'd be interested to hear from a real real estate agent about sales over the last 6 months or so but of course few people would be willing to say the truth in public for fear of driving the market down

Real estate is doing terribly.

I know of one that has sold only one property since new year. Yes one in 11 months.

He said it's never been so bad and now worse because Russians have disappeared in droves.

You only have to walk into any bank branch to see how bad it is.

Scb has cardboard signs with repossessed (still overpriced) houses and land on display. Central festival has a few clogging up the walkways.

Banks have a ton of properties in their possession with no interest in these properties whatsoever.

[Sharp]

Spot on hansgruber was told that by SCB bank manager it's the worst he has seen for a long time