Today's condos, tomorrow's ghettos?

[alantheembalmer]

When I bought my condo in Bangkok 9 years ago, I was after a specific type of development, as I has worked in estate management and knew of many of the pit falls.

The condo I bought is in a two tower, 30 storey complex with a total of 120 units, each one being 280 square metres, and which was designed by the same architects who built The Peninsula, and I think, the Thai Stock Exchange. When I initially had a look at the common areas, I made sure that everything was functioning correctly, was well maintained, and clean, and then I inspected the annual accounts to ensure that they were in a sound condition with sufficient reserves. Lastly, I asked about the management structure, and was pleased to discover that it was run by the residents, for the residents, and that the in-house level of expertise across a whole spectrum of disciplines was outstanding.

Maybe I was just fortunate, but with due diligence a lot of problems can be spotted, although there are no guarantees. One last thing, my condo was built in 1992, so if there had been any major problems, they would have jumped right out at me.

[morrobay]

As already said not a ghetto but run down due to poor maintenance in tropical climate. The constant construction of huge condo complexes has surely created an oversupply.

Oversupply is the devil causing high vacancy rates. And this country has no system to penalise owners leaving their units vacant, nor developers leaving their units unsold.

If this proposed property tax ever passes there is going to be alot of sellers.

[morrobay]

A lot of condos and houses are built to Thai building standards, which may mean in 15 - 20 years the concrete is cracking, the pipes are leaking, paint is peeling etc. All depends on how many corners were cut by the builder - there's a 5 storey condo built about 3 years ago in Chiang Mai which has a foundation consisting of 1 metre of concrete, no pilings. Could be interesting if we have an earthquake in CM.

Anyway, the original post is one of the reasons I will continue renting in preference to buying, even though I can afford it.

What about View Talay Jomtien ? In 2004 studios were 400,000. Would you now regret not buying one of those at that time ?

[trogers]

As already said not a ghetto but run down due to poor maintenance in tropical climate. The constant construction of huge condo complexes has surely created an oversupply.

Oversupply is the devil causing high vacancy rates. And this country has no system to penalise owners leaving their units vacant, nor developers leaving their units unsold.

If this proposed property tax ever passes there is going to be alot of sellers.

Then prices would fall to a more realistic range, raising rental yield.

[Senechal]

Think of it this way: Developers are having a near impossible time unloading all the thousands of tiny 30sqm "rooms" which cost about the same as a house in many parts of the USA and Europe.

Every real estate site is just about overflowing with listings for these house-priced shoeboxes. And from what I keep hearing, for every listing, there are half a dozen they're not listing because they don't want to inundate the listing sites.

Think about it: They can't sell these things when they're brand spanking new.

If anyone thinks these "designer" micro-units are going to increase in value when the apartments are 10 years old and the designs are out of style, they have a few screws loose. Plus, take a look at the exteriors of buildings anywhere in Thailand. Buildings don't age well in this part of the world.

Edited April 20, 2015 by Senechal

[trogers]

Think of it this way: Developers are having a near impossible time unloading all the thousands of tiny 30sqm "rooms" which cost about the same as a house in many parts of the USA and Europe.

Every real estate site is just about overflowing with listings for these house-priced shoeboxes. And from what I keep hearing, for every listing, there are half a dozen they're not listing because they don't want to inundate the listing sites.

Think about it: They can't sell these things when they're brand spanking new.

If anyone thinks these "designer" micro-units are going to increase in value when the apartments are 10 years old and the designs are out of style, they have a few screws loose. Plus, take a look at the exteriors of buildings anywhere in Thailand. Buildings don't age well in this part of the world.

And the good news - they are still launching new projects with these shoeboxes...