Are people in Thailand THAT rich?

[theguyfromanotherforum]

I don't get it.

How come there are no major bank defaults by now? How come the price of real estate keeps going up, month after month? I understand how it works and how condos get sold out (book a room, pay a small deposit then pay monthly rates... done this myself). But come on.... every single condo sold out... and then prices just up up up? No major auto defaults? I have been hearing doom and gloom about Thai loans much longer than the bubbly Canadian real estate.... but here, there never seems to be any problem with banks.

How does economy in Thailand work. I am trying hard to understand.

[TP1]

OP, too many questions and worries.

That's why, I'm never concerned about the economy or politics in this country.

When the Pound goes up. I have a little dance of joy.

When it goes down I ask the g/f to economise.

Enjoy your life and let the others worry.

[Lukecan]

Thailand is actually a very rich country, a lot of well off people here. Bangkok has 2 Ferrari dealers for gods sake, the city I used to live in Europe didnt even have a BMW dealer !

Edited May 21, 2015 by Lukecan

[h90]

Thailand is actually a very rich country, a lot of well off people here. Bangkok has 2 Ferrari dealers for gods sake, the city I used to live in Europe didnt even have a BMW dealer !

But you hardly find any 15 Million people city in Europe.....

[theguyfromanotherforum]

Yes, I think there are a lot of rich people here.

My GF always tells me oh, you have savings (not much), you are rich, but comparing to the average Canadian her family is loaded with land and those rubber trees. She simply does not understand that.

Also, I was at the wedding the other day.... the house was very close to Saphan Taksin BTS. The land that the house was on was worth 1 Billion baht. Then I looked at the new "Rhythm" condo next door where prices start at 5 million for a shoebox. All sold out, of course.

[Lukecan]

Thailand is actually a very rich country, a lot of well off people here. Bangkok has 2 Ferrari dealers for gods sake, the city I used to live in Europe didnt even have a BMW dealer !

But you hardly find any 15 Million people city in Europe.....

Doesn't change the fact that there are a lot of very well of people in Bangkok.

People are not wealthy here in a liquid way, but rather in an illiquid way as the poster above mentioned. The guy might be a street vendor but at the same time he might own a plot of land worth millions of baht. There was this girl I used to date, she didnt seem well off but her family owned land which was worth upward of 100 million baht. Not a lot of people in Europe with net worth greater than $2-3 million you see.

[konying]

Do not try to understand OP, as its nearly impossible, but to clear the air a little from my humble understanding.

A lot of black money circulates in Thailand, A lot of Thai do not pay any taxes.

Many buy property with full amount in cash.

You may find many who do borrow, also do default, but i also know Thai banks are "smart"

What i mean by "smart" is, i know one of my staff went to take out mortgage for a house.

Bank insisted her daughter and son also go on the paper, so if she defaults, daughter and son still owe money,

So in a nutshell, the whole family is liable and hence everybody pitches in to avoid black listing.

[questionsreplies]

Yes, but luckily also millions poor to keep noodles cheap ♥♥♥

[lungbing]

Condos might be sold out, but many are sold to speculators and are never lived in. You can put the price up and up forever, but the actual price of anything is that which a customer is willing to pay.

[BudRight]

OP, too many questions and worries.

That's why, I'm never concerned about the economy or politics in this country.

When the Pound goes up. I have a little dance of joy.

When it goes down I ask the g/f to economise.

Enjoy your life and let the others worry.

In a field one summer's day a Grasshopper was hopping about, chirping and singing to its heart's content. An Ant passed by, bearing along with great toil an ear of corn he was taking to the nest.

"Why not come and chat with me," said the Grasshopper, "instead of toiling and moiling in that way?"

"I am helping to lay up food for the winter," said the Ant, "and recommend you to do the same."

"Why bother about winter?" said the Grasshopper; "We have got plenty of food at present." But the Ant went on its way and continued its toil.

When the winter came the Grasshopper had no food and found itself dying of hunger - while it saw the ants distributing every day corn and grain from the stores they had collected in the summer. Then the Grasshopper knew: It is best to prepare for days of need.

[KhunBENQ]

Are people in Thailand THAT rich?

Some!

Thailand is surely one of the countries in the world with the highest spread between rich and poor.

More than 20 Dollar billionaire clans on one side, peasants feeding on sticky rice, fish paste and homegrown vegetables on the other side.

When I walk through the hiso malls in Bangkok and see the price tags, I find it "obscene" (I am living in an upcountry village).

Condos, real estate: many factors here.

Rich Thais are just one source of demand.

Edited May 21, 2015 by KhunBENQ

[CharlieH]

MOVED to Business/Banking/Economy etc

[HeijoshinCool]

Rubber tree land in Rhek Thum has continually risen since 2009.

Land is now selling for a higher price than rural parts of the States. It continues to sell because the locals don't stop to do the math: at even double the current rubber prices, it will take many, many decades to break even.

It is similar to auction fever: someone is going broke and puts the land up for sale, and people are terrified someone else will get it first.

And yes, apologists, it has to do with Face.

"Look at all the land I own."

[blackcab]

One thing you will notice with Thai banks is that they do not appear to sell off repossessed land at auction or in any other way that writes off some of the value. If the bank can't sell a piece of land, it keeps it on the books at full market value.

Because of this, land holds its price. Land is not sold off cheap. In fact I would go so far as to say that land is simply not sold off.

Thais are land mad. They adore owning land. Which means they don't like selling it.

If land is being sold it's for a reason - quite often because there is a loan on the land that cannot be repaid.

The follow on to this is that when really nice pieces of land are sold there is often a sorry tale or a problem somewhere.

[mca]

My niece works for one of the biggest property developers in Thailand and told me that even though they initially sell out the amoumt of returns due to people paying the deposit and then being rejected for a mortgage was pretty big. The same when we sold our bungalow in Khon Kaen. Asking price was THB 1.8 which worked out quite reasonable monthly repayments on a long term mortgage but of the 5 people at one point keen to buy every single one couldn't get finance. In the end sold to a nice bloke who paid cash.

[Muzarella]

Interesting posting. I asked myself many times about that.

Even "modest" people here seems to manage to pay its bills, sometimes with help of friends and family, but keep them going. Also, I can see a lot of waste of money and resources from small farmers, new small enterprises, with evident not planning at all.

Even people that seems to be sucessful, business people, mediam high class people, seem not to be very smarts in some of its ventures, or its investiments, and not worry too much in making real profits or losing money. Sometimes looks like its have money to waste, or extra cash flow.

Comparing with many Wedstern countries, I can tell that most medium class people in Thailand, teachers, Government employess, nurses, etc, lives in higher standars and without so much debts.....

And people that really are good in planning, with more "western" mind and attitude, seems to do very well and getting rich easily in Thailand....in Thailand standars....and some in Western standars. Very many 1 mill US dolar homes in BK.

That is my impression about Thai people in North Thailand..... after years frequenting Thai families and Thai business.... and trying to understand Thai way of life. The ..sabai..sabai...attitude is not easy to understand...but looks like works well for most.....and very well for the hard and smart workers.

I may be wrong, but contrary to most farangs think, I believe that Thailand is a good place for business, and to get rich.

Edited May 22, 2015 by Muzarella

[bheard]

Rich Asian people tend to be STINKING rich compared to rich people in most western other countries. Thailand is no different. The disparity between rich and poor is much greater as well. Also in Thailand there are many people in the middle who are doing very well thank you - farangs don't always see them 'cos they are at work, looking after business.

[Morakot]

Thailand is actually a very rich country, a lot of well off people here. Bangkok has 2 Ferrari dealers for gods sake, the city I used to live in Europe didnt even have a BMW dealer !

Number of Ferrari dealers a measure for wealth and prosperity of a country?

[WitawatWatawit]

Thailand is actually a very rich country, a lot of well off people here. Bangkok has 2 Ferrari dealers for gods sake, the city I used to live in Europe didnt even have a BMW dealer !

Number of Ferrari dealers a measure for wealth and prosperity of a country?

Yes. It's an adjunct to the Prada Index.

Any idea what the poor are doing today?

[flyingdoc]

Very rich and very poor. A real dichotomy !

[Brian Robson]

In Thailand, a one credit card man is king!

[Morakot]

Any idea what the poor are doing today?

Word has it, they all relax in these trendy rooftop bars displaying their consumer items of aspirational affluence ...

Edited May 22, 2015 by Morakot

[ozzieovaseas]

Maybe a more telling questions to consider would be.. how is debt repatriated? or how are loan defaulters dealt with? (by law) in Thailand?

You can look out on any road outside your window in BKK and see thousands of new expensive cars getting around, but if you look beneath the surface they say that personal debt in Thailand is getting to the point where its off the charts crazy.

In any system like this there must be a correction sooner or later, no matter what the market is ..unless of course, Thais have perfected some foolproof system that is bubble-bursting free

A previous poster talking about real estate and land prices was interesting. I believe the rates (money paid by householders to government for goods and services) on private property is virtually nothing here. I guess thats how people can still survive here (allbeit poorly) and are able to sit on real estate while having limited income.

(If i owned a house in Australia but had no income or savings to rely on, i would probably be forced to sell the property after two years, just to pay the government its yearly rates and taxes. And unlike the rich dodging taxes, you cannot swindle your way out of that one.)

Interesting that the Thai cut interest rates recently. I think they know something is coming and have followed the policy that every other country has tried already. Its a last ditch effort when you've tried everything else but all is still going to Sh7t.

I believe worldwide, our governments are not telling us the real story about the debt problem. They simply do not want people to know, as they dont want to be held accountable for doing nothing about it.

Thailand will have its turn soon enough i fear (but hope i am wrong) The next one will probably be so big it will make the tom yum goong crisis look like 10 baht falling out of a hole in your pocket

[Tchooptip]

Thailand is actually a very rich country, a lot of well off people here. Bangkok has 2 Ferrari dealers for gods sake, the city I used to live in Europe didnt even have a BMW dealer !

Number of Ferrari dealers a measure for wealth and prosperity of a country?

How many Ferrari dealers in countries like Liberia Malawi or Eritrea or Haiti or Uganda or Senegal or Zimbabwe or Nepal or Tanzania or Chad or

Tajikistan or Cameroon and many more ?

[Morakot]

How many Ferrari dealers in countries like Liberia Malawi or Eritrea or Haiti or Uganda or Senegal or Zimbabwe or Nepal or Tanzania or Chad or

Tajikistan or Cameroon and many more ?

Do they have roads there?

[carib102]

There are many very rich Thais who see a 100 million baht investment in land or condos as just testing the waters. So, they buy entire floors in new condo development, or 100s of rai in areas that are likely to experience high growth rates. Since there is no tax on land as in Western countries they can easily sit on this land for 10-20-50 years waiting for it to appreciate in value. Thais (and Asians in general) take a very long view when it comes to family wealth. So, a small number of very rich families and a huge number of poor people who rent from the rich families. It is the modern equivalent of feudalism.

[elgordo38]

Thailand is actually a very rich country, a lot of well off people here. Bangkok has 2 Ferrari dealers for gods sake, the city I used to live in Europe didnt even have a BMW dealer !

There is a lot of regular money floating around and then there is the black money. As far as banks going under and real estate bubbles they tend to slowly build up and collapse suddenly its coming just be patient.

[SOUTHERNSTAR]

Do not try to understand OP, as its nearly impossible, but to clear the air a little from my humble understanding.

A lot of black money circulates in Thailand, A lot of Thai do not pay any taxes.

Many buy property with full amount in cash.

You may find many who do borrow, also do default, but i also know Thai banks are "smart"

What i mean by "smart" is, i know one of my staff went to take out mortgage for a house.

Bank insisted her daughter and son also go on the paper, so if she defaults, daughter and son still owe money,

So in a nutshell, the whole family is liable and hence everybody pitches in to avoid black listing.

Only 360 000 people pay taxes although many more are registered. Only +- 310 000 companies pay taxes.

After 1997/98 banks created a bad bank on their books and pushed all the properties in default into this. It is in many cases still on their books at the original loan amount, not at market value. Just go onto any banks property webpage and you will see some very rundown properties on there at sky high prices.

Government and corporate debt (even after the rice scheme) in Thailand only increased slightly after 2008, but private/household debt exploded. At present Thailands total debt is about 187% of GDP. Which is way to high for the current position of world economic cycle.Link http://www.zerohedge.com/news/2015-02-23/biggest-problem-facing-world-today-9-countries-have-debt-gdp-over-300.

[recycler]

A very small group is actually excessivly rich with fortunes that are 2 to 3 times that of most "old money" rich families in Europe.

Than there is a small percentage that has companies or benefits from corruption that can spend big money.

A larger, but still small middle class that is resonable well educated that can spend, but is often already in serious depbt.

Than you have the lower middle class wannabees that have little money, but support the status quo against their own interest. Here you see the depbt becoming dangerous.

And 95% or more of the Thai people struggle to survive on ever rising prices and often loose the battle to give their kids a reasonable education, they are the ones that are exploited to keep this system running.

Change never comes from the top, always from the bottom!

[laobali]

In Thailand, a one credit card man is king!

In Thailand, a one credit card man is king!