Under The Current Climate Would You Buy A Condo?

[sanukmagmag]

Ben@H3, no one on this forum has ever said or even rumored that the authorities just step in and confiscate property as has been done in many third world countries from Mexico to Nigeria.

What has been said over and over and over and over, listen carefully here, we are guests in a third world country without priveleges or rights of any kind. Our invitation can be revoked in a moments notice for arbitrary reasons that we may or may not know. We can still own our beautiful house from the safety of Coventry or Los Angeles but for all extents and purposes, its out of our reach. There are countless stories of farangs (and Thais) getting crushed and evicted by the military/police/mafia who walk away from it all.

There is a huge differance between losing your property by confiscation and being forced to leave. So lets all drop the "never heard of it happening" I think we all agree that it does not happen in Thailand. Instead, keep to the first rule of Thailand, NEVER INVEST MORE THAN YOU CAN WALK AWAY FROM, and understand its because we dont have a SINGLE right here, particularly when we flaunt the law by purchasing property against the wishes or regulations of the authorities.

If you can walk away, have at it. Buy all of Phuket island if you are so inclined. I am sure smart investors have made and will make a lot of money off speculative land in Thailand but always, always always be prepared to pack a single bag and make for the border.

[sanukmagmag]

Ben@H3, no one on this forum has ever said or even rumored that the authorities just step in and confiscate property as has been done in many third world countries from Mexico to Nigeria.

What has been said over and over and over and over, listen carefully here, we are guests in a third world country without priveleges or rights of any kind. Our invitation can be revoked in a moments notice for arbitrary reasons that we may or may not know. We can still own our beautiful house from the safety of Coventry or Los Angeles but for all extents and purposes, its out of our reach. There are countless stories of farangs (and Thais) getting crushed and evicted by the military/police/mafia who walk away from it all.

There is a huge differance between losing your property by confiscation and being forced to leave. So lets all drop the "never heard of it happening" I think we all agree that it does not happen in Thailand. Instead, keep to the first rule of Thailand, NEVER INVEST MORE THAN YOU CAN WALK AWAY FROM, and understand its because we dont have a SINGLE right here, particularly when we flaunt the law by purchasing property against the wishes or regulations of the authorities.

If you can walk away, have at it. Buy all of Phuket island if you are so inclined. I am sure smart investors have made and will make a lot of money off speculative land in Thailand but always, always always be prepared to pack a single bag and make for the border.

For people who still dont believe XBusman here a story from Patong, Phuket

some year ago, but show very good what can happen.

German rent land on 5 year contract from Thai to build some simple bungalows

After 3.5 year the Thai visit ther German and informed, that the land is sold and that he has leave the place. The German made a calculation and wanted 3 Million TB to finish the contract 1.5 year before the normal ending of contract.

The Thai showed the owner an envelop and said: This is ONE million Baht.

The German went angry home and did not make the "deal".

Next early morning 2 trucks with 50 Burmese workers drive into the property.

"All out" we will demolish all bungalows - come out in 10 minutes!"

The owner phones police. Answer - sorry we can do nothing.

Two hours later there are no Bungalows any more on this property.

In the evening the sad owner visits the Thai landlord again and aske for his million.

"That was yesterday" answered the day and gave him no Baht at all.

Because the German had legal contract he consulted a Phuket lawyer.

Nothing happened for 2 weeks and the German had a very good idea.

He traveled to Bangkok to a big INTERNATION lawyer office and showed his contract and told his story. He came back from Bangkok and told his friends:

"Now everything ok - you just can not do with local lawyers!"

Three days later he got a telephone call from BKK - we are so so sorry, but we can not work on your claim" Any more questions?

Sorry for my poor English, its not my mother language.

Sanukmagmag

[xbusman]

Thank you Sanukmagmag, very nicely written in a not-my-mother language. I would be proud if I could write as well in Thai.

Those stories are countless and happen not every year, not every month, but every day. To say it wont or cant happen to me are the idiots without helmets and seat belts, it probably wont happen to you but please, please buy a condo over ten floors in case it does.

[Arkady]

Ben@H3, no one on this forum has ever said or even rumored that the authorities just step in and confiscate property as has been done in many third world countries from Mexico to Nigeria.

What has been said over and over and over and over, listen carefully here, we are guests in a third world country without priveleges or rights of any kind. Our invitation can be revoked in a moments notice for arbitrary reasons that we may or may not know. We can still own our beautiful house from the safety of Coventry or Los Angeles but for all extents and purposes, its out of our reach. There are countless stories of farangs (and Thais) getting crushed and evicted by the military/police/mafia who walk away from it all.

There is a huge differance between losing your property by confiscation and being forced to leave. So lets all drop the "never heard of it happening" I think we all agree that it does not happen in Thailand. Instead, keep to the first rule of Thailand, NEVER INVEST MORE THAN YOU CAN WALK AWAY FROM, and understand its because we dont have a SINGLE right here, particularly when we flaunt the law by purchasing property against the wishes or regulations of the authorities.

If you can walk away, have at it. Buy all of Phuket island if you are so inclined. I am sure smart investors have made and will make a lot of money off speculative land in Thailand but always, always always be prepared to pack a single bag and make for the border.

For people who still dont believe XBusman here a story from Patong, Phuket

some year ago, but show very good what can happen.

German rent land on 5 year contract from Thai to build some simple bungalows

After 3.5 year the Thai visit ther German and informed, that the land is sold and that he has leave the place. The German made a calculation and wanted 3 Million TB to finish the contract 1.5 year before the normal ending of contract.

The Thai showed the owner an envelop and said: This is ONE million Baht.

The German went angry home and did not make the "deal".

Next early morning 2 trucks with 50 Burmese workers drive into the property.

"All out" we will demolish all bungalows - come out in 10 minutes!"

The owner phones police. Answer - sorry we can do nothing.

Two hours later there are no Bungalows any more on this property.

In the evening the sad owner visits the Thai landlord again and aske for his million.

"That was yesterday" answered the day and gave him no Baht at all.

Because the German had legal contract he consulted a Phuket lawyer.

Nothing happened for 2 weeks and the German had a very good idea.

He traveled to Bangkok to a big INTERNATION lawyer office and showed his contract and told his story. He came back from Bangkok and told his friends:

"Now everything ok - you just can not do with local lawyers!"

Three days later he got a telephone call from BKK - we are so so sorry, but we can not work on your claim" Any more questions?

Sorry for my poor English, its not my mother language.

Sanukmagmag

The lease was probably not registered with the Land Dept which would make it invalid after the first 3 years. Even if it were, the tenants rights are not binding on the new owner. The lease agreement would, I think, have to specify that the owner agreed not to sell during the term of the lease. Anyway these Thai owners don't give a monkeys. You can imagine that guy with a red face over black so in the karaoke bar later boasting to his crooked Thai Chinese friends afterwards about the look on the fat farang's face when he told him the wouldn't get even one baht. Even if the agreement is valid they will use brute force, like Thaksin did in his cable TV venture, and pay off police and politicians later, if there is a problem. Look what happened to Chuwit after all the fuss about him brutally destroying all those bars in Sukhumvit Soi 10 - nothing. He even ran for Bangkok governor after that and quite a few stupid Thais actually voted for the sh*t. The German guy can find law and order in Germany but not here.

[bingobongo]

Risks rising sharply in Thailand: survey

It added that "conditions could deteriorate in 2007."

http://www.nationmultimedia.com/breakingne...newsid=30026749

[backflip]

Oh no! Quick, time to hide!

[bingobongo]

A Mixed Year for Asian Residential Property in 2006 According to Global Property Guide

Thailand saw the end of ending its strong post-Asian crisis property market recovery, as the political crisis impacted the economy. House prices moved up just 1.9% in 2006 (-2.4% in real terms), after 2005’s price increase of 7% (1.5% in real terms), and 2004’s rise of 9% (6% in real terms).

http://www.newswiretoday.com/news/14048/

[backflip]

Oh no, I guess that means the real estate market is crashing. Ohhhh nooooo....

[bingobongo]

Oh no, I guess that means the real estate market is crashing. Ohhhh nooooo....

it wll be worse, at least with a crash, it would be over quickly, instead it will be a slow and steady grind lower

this chart, doesn't even take into account the coup and capital controls, so the YOY comparison will be worse for 2006-2007

[Gary A]

AND, your point is? What does land speculation have to do with legally purchasing a condo? It is just a simple fact that a farang CANNOT own land in Thailand.

[pkrv]

Welome GARY A - I think you have the drift

[thaigene2]

Welome GARY A - I think you have the drift

PKRV

Have you taken possession yet of your new condo? Can't remember which one..but you're not selling or on commssion correct?

Another question that I keep asking and that no one ever answers is (and this may well be relevant to you pkrv):

What happens if you buy off-plan, pay your deposit, installements over 24 months or whatever, then when it's time to pay the final 80% - you pay -- but few others do!!! Because they never intended to do so - they hoped to flip to someone else..but that'someone' never showed up...so they walk away.

So then there is pkrv (or whomever) and 20 other buyers who pay -- but it's not enough for the bank to say 'okay' and release the property...and, and......?? What?

[pkrv]

thaigene2

You have hit the nail on the head. Please take a look at the Forums to which I have absolutely openly contributed to over the last few years, maybe there is an answer to your direct questions.

http://www.skyscrapercity.com/showthread.p...03#post11914503

http://www.thaivisa.com/forum/index.php?showtopic=58207

No I (We) have not taken possession yet (Soon May we think). Yes I understand your comments about occupancy (The Lakes comes to mind) - Hence the three years up front maintenance part of the agreement – regardless.

This Forum itself is a mechanism for regulation, and providing you state facts your comments remain in place. This is an important/key part of what is happening in Thailand and indeed (apart from the gun crime figures) makes it very appealing indeed.

[merlion]

Oh no, I guess that means the real estate market is crashing. Ohhhh nooooo....

it wll be worse, at least with a crash, it would be over quickly, instead it will be a slow and steady grind lower

this chart, doesn't even take into account the coup and capital controls, so the YOY comparison will be worse for 2006-2007

Foreigners should stick to the condo route in Thailand. By the way, what's the big deal with land ownership in los with the foreigners? Condos are a better bet imo.

[merlion]

Oh no, I guess that means the real estate market is crashing. Ohhhh nooooo....

Backflip, why are you soooo childish with your postings? It may seem funny initially, but gets rather irritating if you make a habit with all your inept postings.

[jumnien]

Oh no, I guess that means the real estate market is crashing. Ohhhh nooooo....

Backflip, why are you soooo childish with your postings? It may seem funny initially, but gets rather irritating if you make a habit with all your inept postings.

Dear Mr. Merlion,

Did it really take you 12 days to come up with your criticism of Mr. Backflip's comments? Please either be relevant in your criticism, or if you choose to be irrelevant, as this criticism surely is, please be prompt!

Good day, M

[pkrv]

Oh no, I guess that means the real estate market is crashing. Ohhhh nooooo....

Backflip, why are you soooo childish with your postings? It may seem funny initially, but gets rather irritating if you make a habit with all your inept postings.

Dear Mr. Merlion,

Did it really take you 12 days to come up with your criticism of Mr. Backflip's comments? Please either be relevant in your criticism, or if you choose to be irrelevant, as this criticism surely is, please be prompt!

Good day, M

It is incredibly important to understand that the English language contains nuances. These nuances are designed for a particular reason and aid us in understanding who people are. Instinctively applying these nuances to non English speakers (and that can actually mean Americans), can cause problems.

Perhaps another way of exploring what is happening is to look just at the facts.

It has been agreed by the starter of this thread Thai property has increased in value since the thread started.

As you get older your income diminishes and rents go up

You cannot own land in Thailand

Thailand is still a bargain - but given the above for how much longer?

And a personal comment – Some people blame every one else and everything rather than taking responsibility for themselves (hence the concept of gods and devils), you chose to buy in Thailand, or do not – I know what we have done.

[backflip]

"your inept postings"

Irritating, perhaps, but never inept. You should save your comments to those who constantly bray that the sky is falling / has fallen / will fall / might fall / could fall / should fall...I poke fun at those who believe every single newspaper sentence that could possible be defined as "not substantial proof that the Thai real estate market is robust and thriving", is evidence that the Thai real estate market is crashing. Thus:

"prices down 1% from last year" = market crashing

"condo project cancelled" = market crashing

"bombings caused by Islamic fundamentalists" = market crashing

It reminds me of the Gary Larson cartoon about a horse doctor using a "horse doctor's reference book", where every solution is "shoot horse":

"sore foot" = shoot horse

"pink eye" = shoot horse

"mange" = shoot horse

[merlion]

"your inept postings"

Irritating, perhaps, but never inept. You should save your comments to those who constantly bray that the sky is falling / has fallen / will fall / might fall / could fall / should fall...I poke fun at those who believe every single newspaper sentence that could possible be defined as "not substantial proof that the Thai real estate market is robust and thriving", is evidence that the Thai real estate market is crashing. Thus:

"prices down 1% from last year" = market crashing

"condo project cancelled" = market crashing

"bombings caused by Islamic fundamentalists" = market crashing

It reminds me of the Gary Larson cartoon about a horse doctor using a "horse doctor's reference book", where every solution is "shoot horse":

"sore foot" = shoot horse

"pink eye" = shoot horse

"mange" = shoot horse

Thanks backflip for your clarification. As for Ms M, I wasn't asking you, keep your opinion to yourself bitch.

[jumnien]

Sounds like our little puppy has absolutely no sense of humor!

[merlion]

Sounds like our little puppy has absolutely no sense of humor!

Speak for yourself beaatch!

[jumnien]

He's baaaaack!

[merlion]

He's baaaaack!

Hahaha, go back to your dreamland.

[pkrv]

So as we get older and wiser

Is it not agreed that as you get older your income diminishes and rents increase? If that this the case it is quite important to understand that to recover dignity some people justify renting. Renting is an option for those who can buy outright but choose instead to protect their wealth from organised theft .

[Cyberstar]

If I remember well, the topic of this thread was "Under the current climate would you buy a condo?" ... Until now I haven't voted because I wouldn't buy a condo under any climate, but now I vote 'yes', because I haven't seen any generally applicable argument against it except that one must do one's due diligence.

[samtam]

If you follow smart investment rules, you buy when prices are falling and sell when they're rising. The Thai condo market isn't a straightforward market in the normal understanding of "market", in that it's not free-flowing. However, I have seen some "distress" sale prices, for want of a better description. There's a condo in my building that is offered at 38% below the "normal" price. That to me is an interesting type of opportunity that the current uncertainty is producing. The judgement is whether 38% is enough of a discount, viz are there likely to be many more price reductions like that? Probably not, but it depends on your view of future political developments in Thailand over the coming 5-10 years. Fundamentally I would suggest things should be on an uptrend, but politically and structurally the country is at an unusual stage of its history, and the jury is still out on which path it will take.

[Arkady]

So as we get older and wiser

Is it not agreed that as you get older your income diminishes and rents increase? If that this the case it is quite important to understand that to recover dignity some people justify renting. Renting is an option for those who can buy outright but choose instead to protect their wealth from organised theft .

Buying a house is a different proposition as you can't own the land yourself and all ownership structures involves some risk. A condo is a more obvious choice for some one who finds one they really like and wants to life in it permanently. The security against rising rents and/or baht appreciation can give peace of mind, although of course things can go either way, as in the Asian crisis. Otherwise be sure to invest the money in things that will be a good hedge against Thai living costs. Of course not every one has the option of buying a condo for cash.

[Casanundra]

The argument about buying a Condo now in cash to save for future rent increases is pretty much a false economy.

If you sank 5 million baht into a savings account and didn't touch it for 10 years whilst earning compound interest at 5% tax free over the same period then you would need to be paying rent of equivalent to approx 65k per month in order to break even over that period of time.

When you add into this the risk of the Condo deteriorating during that time, to the political and visa regulations having their effect and to being stuck in a place when Khun Kwai and the Karaoke beer drinkers band move into the Condo next door then I pretty much say that it is best to keep your money in the bank and move on when circumstances around you change.

Now, hands up all those currently paying 65k or more per month in rent and have been doing so over a period of 10 years? Anyone?

[Macx]

Investment, gains, losses, opportunity costs....

and on and on...

but what gets to me is that all the negative changes in LOS sure does put a damper on my buying mood

why do it if you don't need to and you don't enjoy it

[pkrv]

In Order - Sorry I am off on one - my deepest apologies.

Cyberstar - you wouldn't perhaps possibly be providing for the future perchance?

Arkady - Forget buying a house - DEAD DUCK BIG TIME.

Casanundra - Oddly unlike finances people grow old and die, treating HOMES, as an asset class is possibly the most stupid thing I have ever heard of - OK there are property speculators but if you cannot spot those a mile off... even then the young can recover (After many years, but not the old). Unless you hate the property/are in financial difficulty and need to get rid of it why bother moving, or why else were you there in the first place?

Macx - Depends on what you see in Thailand - Progress or Regression? Only your choice matters.