It's official - Thai real estate bubble pops.

[InMyShadow]

  
Why are you doing this? Give it a rest please....it's Friday night, someone as rich as you surely has many friends and many better things to do.
 
 
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Yawn
I did what I had to do. It exposed certain posters and not in a good way.
Besides I went out last night [emoji5]

[thaifoodruns]

YawnI did what I had to do. It exposed certain posters and not in a good way.

Besides I went out last night [emoji5]

 

 

Give yourself a noddy badge and come pick up your trophy tmr

 

 

 

Sent from my iPhone using Thailand Forum - Thaivisa mobile app

 

[trogers]

45 minutes ago, InMyShadow said:

I don't know who is more embarrassing. The heavily vested bangkok condo owner t Roger's who for years and every post is screaming sell whilst not selling himself or the expat oil worker who backs him

 

Honestly you can't make this stuff up, comedy gold but I love it, please don't let the entertainment stop

 

 

 

 

No. I am not screaming "Sell". 

 

I am screaming "Don't buy" at today's asking prices because rental yields don't make sense and watch out on the growing large unsold inventory.

[bazza73]

9 hours ago, trogers said:

No. I am not screaming "Sell". 

 

I am screaming "Don't buy" at today's asking prices because rental yields don't make sense and watch out on the growing large unsold inventory.

Don't know what the situation is in Pattaya or Bangkok. Don't care.

In Chiang Mai, the glut of unsold houses and condos is huge. My landlord has been trying to sell the apartment I live in for years. I've never even had to move aside for an inspection by a prospective buyer.

My friend has been trying to sell his house for about 6 months. In that time, he has had two inspections by buyers. At the rate he is going, he will be underwater on the land and build cost very shortly.

[trogers]

5 minutes ago, bazza73 said:

Don't know what the situation is in Pattaya or Bangkok. Don't care.

In Chiang Mai, the glut of unsold houses and condos is huge. My landlord has been trying to sell the apartment I live in for years. I've never even had to move aside for an inspection by a prospective buyer.

My friend has been trying to sell his house for about 6 months. In that time, he has had two inspections by buyers. At the rate he is going, he will be underwater on the land and build cost very shortly.

My advice for those who has bought in the past couple of year is to formulate Plan B.

 

Lower asking rent to attract long-term tenants and juggle personal finances to wait out for up to 2 decades for the next upswing of the property cycle.

[KittenKong]

2 hours ago, trogers said:

Lower asking rent to attract long-term tenants .....

 

And risk the ghetto effect. Already very visible in many buildings.

[cheeryble]

12 hours ago, trogers said:

No. I am not screaming "Sell". 

 

I am screaming "Don't buy" at today's asking prices because rental yields don't make sense and watch out on the growing large unsold inventory.

 

I'd go along with you TR on the new condo market unless I needed a home for myself and couldn't find a good older building. And then I'd be careful that the power structure was right i wouldn't buy unless a proper committee was formed or on it's way and fees were reasonable. I would be careful not to be purposely misled as with the Trump Soho  where 15% sales were exaggerated to 60%.....easy enough done......because buying into a 15% sold building in today's new market would be highly inadvisable. (ps Trump or the group he was fronting for had to repay)

I took a look at condo building costs in CM a couple or more years ago.....I think they are only making a modest profit and would not hold my breath waiting for prices to go down.....although that said prices seem to have risen from then think i was looking at the mid 40ks/sqm some pretty basic new places now are asking somewhat more (CM).

I know one older building very well which has gone up in the world and has a fair few really quality renovated units.....nicer than anything new I have seen......and prices have not dropped the contrary I know two units have sold fast the last few months for the first time up into the low 50ks/sqm and there's room for higher as the common areas improve further. The other quality units are either owner occupied or are renting all but instantly.

Quality, size, and location really do seem to count.

[trogers]

1 minute ago, cheeryble said:

 

I'd go along with you TR on the new condo market unless I needed a home for myself and couldn't find a good older building.

I took a look at condo building costs a couple or more years ago.....I think they are only making a modest profit and would not hold my breath waiting for prices to go down.....although that said prices seem to have risen from then think i was looking at the upper 40ks/sqm some pretty basic new places now are asking somewhat more (CM).

I know one older building very well which has gone up in the world and has a fair few really quality renovated units.....nicer than anything new I have seen......and prices have not dropped the contrary I know two units have sold fast the last few months for the first time up into the low 50ks/sqm and there's room for higher as the common areas improve further. The other quality units are either owner occupied or are renting all but instantly.

Quality and location really do seem to count.

Old condo units in good locations are rather resilient to price fluctuations. That's why I say they are bubble proof. Price increase generally follows general inflation of 3-5% pa. So, rental yield at the selling price is an important consideration in your bargaining.

 

When I started in 2007-8, my expectations on yield was in the 7-9% range. After a decade, yield range now would be in the 5-7% range to reflect modest price increases on a flat rent condition.

 

 

[theguyfromanotherforum]

12 hours ago, InMyShadow said:

Yawn
I did what I had to do. It exposed certain posters and not in a good way.
Besides I went out last night

 

If you are well off, why are you investing in Bangkok where you have no legal rights to live and the government can at any time impose a foreign tax just like they did in HK, Vancouver, Toronto and some other USA cities? 

 

You also said you did well for yourself buying a place some years ago as you won't be able to afford it now because some projects are going up to 400k per square meter in the neighborhood. But you know as well as I do that older buildings in Thailand are not holding value very well except in a very few exceptions.

 

So... this being the anonymous forum I wonder why bother with a place in Thailand that was probably built by Cambodians and is falling apart by now instead of selling it for these huge profits that rival  Monaco and buying somewhere else with steady rental yields with much better construction and environmental. TBH, your posts don't make much sense either.

 

 

[cheeryble]

7 minutes ago, theguyfromanotherforum said:

 

If you are well off, why are you investing in Bangkok where you have no legal rights to live and the government can at any time impose a foreign tax just like they did in HK, Vancouver, Toronto and some other USA cities? 

 

You also said you did well for yourself buying a place some years ago as you won't be able to afford it now because some projects are going up to 400k per square meter in the neighborhood. But you know as well as I do that older buildings in Thailand are not holding value very well except in a very few exceptions.

 

So... this being the anonymous forum I wonder why bother with a place in Thailand that was probably built by Cambodians and is falling apart by now instead of selling it for these huge profits that rival  Monaco and buying somewhere else with steady rental yields with much better construction and environmental. TBH, your posts don't make much sense either.

 

 

 

The cases of permanent expulsion from Thailand are so rare as to not count. You have to do something damn serious and even then they often seem to come back in.

The difference between here and Canada etc is tax law is made to keep the rich rich to a far larger extent. I pay to the Inland Revenue here twice a year and frankly it doesn't hurt much, happy to sleep well.

There is no reason for any building that has withstood it's first few years to "fall apart" anywhere can last virtually forever with a maintenance schedule.

Owning property remotely can occasionally work but is far more often a terrible pain in the arsx over which you have no control unless you fly XX hours every XX months. 

[theguyfromanotherforum]

10 minutes ago, cheeryble said:

 

The cases of permanent expulsion from Thailand are so rare as to not count. You have to do something damn serious and even then they often seem to come back in.

The difference between here and Canada etc is tax law is made to keep the rich rich to a far larger extent. I pay to the Inland Revenue here twice a year and frankly it doesn't hurt much, happy to sleep well.

There is no reason for any building that has withstood it's first few years to "fall apart" anywhere can last virtually forever with a maintenance schedule.

Owning property remotely can occasionally work but is far more often a terrible pain in the arsx over which you have no control unless you fly XX hours every XX months. 

 

Not really.

I have a tenant in Toronto that has been paying every month without issues and he never complains. He mails the checks to my mom and she deposits them. 

 

You see, in civilized countries communication is the key. If there are any issues (which there weren't in over 4 years) the management I n my building will deal with almost anything. If I have to pay something, I'll just take it off the rent. All this in a country where landlords have very little rights as you probably know.

 

Easy.

 

Also my condo that was built in 2000 looks more modern, cleaner and nicer than Ideos, Rhythms and Aspires built just 5 years ago. This is what scares me buying here. Very poor maintenance.

[cheeryble]

7 minutes ago, theguyfromanotherforum said:

 

Not really.

I have a tenant in Toronto that has been paying every month without issues and he never complains. He mails the checks to my mom and she deposits them. 

 

You see, in civilized countries communication is the key. If there are any issues (which there weren't in over 4 years) the management I n my building will deal with almost anything. If I have to pay something, I'll just take it off the rent. All this in a country where landlords have very little rights as you probably know.

 

Easy.

Good luck to you if I had a dear old Mum still i might do the same except the yields back home don't do it for me.

We had good tenants in Mum's bungalow actually to help pay for her care......it went very well with two tenants.....until the Black Swans came along.

[trogers]

2 hours ago, KittenKong said:

 

And risk the ghetto effect. Already very visible in many buildings.

Not really. My method of calculating a lower rent is simple. Discount agent's commission and a month's vacancy rate from the market annual rent, and divide by 12.

[trogers]

4 hours ago, theguyfromanotherforum said:

 

Not really.

I have a tenant in Toronto that has been paying every month without issues and he never complains. He mails the checks to my mom and she deposits them. 

 

You see, in civilized countries communication is the key. If there are any issues (which there weren't in over 4 years) the management I n my building will deal with almost anything. If I have to pay something, I'll just take it off the rent. All this in a country where landlords have very little rights as you probably know.

 

Easy.

 

Also my condo that was built in 2000 looks more modern, cleaner and nicer than Ideos, Rhythms and Aspires built just 5 years ago. This is what scares me buying here. Very poor maintenance.

Dirty and dusty glass do age a building, doesn't it. That's the trouble with most of these high-rises here lacking the budget for monthly window cleaning.

[ExpatOilWorker]

On 10/9/2017 at 5:32 PM, Naam said:

per capita comparisons are most of the time milkmaid estimates.

 

can one compare Thailand's economic success of the last several decades with China's success? are Chinese real estate business people idiots? 

Nope, I don't think the Chinese real-estate people are idiots, but I also don't think the Thai real-estate people were idiots in the '90. Things beyond their control just changed.

A whole generation of Chinese have only seen 7+% growth (+4-5% inflation) and most likely the real-estate sector rely on this growth. There are examples of developers that have paid more for a plot of land than the price of the land and a finished building is worth at current prices. They simply expect prices to increase so much that they can make a profit, but what happen if China suddenly have 2-3% growth and hardly any inflation, like Japan post 1989?

 

It is like the Chinese have been extreme successful building at the moon, but one day they are exposed to the gravity of the Earth. Not everything will be left standing after that.

[bazza73]

1 hour ago, ExpatOilWorker said:

Nope, I don't think the Chinese real-estate people are idiots, but I also don't think the Thai real-estate people were idiots in the '90. Things beyond their control just changed.

A whole generation of Chinese have only seen 7+% growth (+4-5% inflation) and most likely the real-estate sector rely on this growth. There are examples of developers that have paid more for a plot of land than the price of the land and a finished building is worth at current prices. They simply expect prices to increase so much that they can make a profit, but what happen if China suddenly have 2-3% growth and hardly any inflation, like Japan post 1989?

 

It is like the Chinese have been extreme successful building at the moon, but one day they are exposed to the gravity of the Earth. Not everything will be left standing after that.

There are indications in Australia that Chinese investment in property has peaked, and it's downhill for property values now.

IMHO property investment is for 20 and 30 year olds. For a septuagenarian like me, it's BS. I'd rather rent.

[cheeryble]

Regarding the new mini-condos, by far most of the units going up:

 

So if we assume the Chinese stop buying......or don't accelerate their starting to buy....... in spite of an obvious trend which is beginning to be measurable in increasing international school places........increasing numbers of flights........Chinese language on the speakers everywhere all of a sudden.......genuine fear of air pollution in China (yes we get some weeks in CM but Chinese i have spoken to regard it as a clean air haven) ..............and of course Chinese everywhere because CM's cheap as chips and an ideal distance from their home.

........that just leaves the accelerating young Thai demographic which is growing up permanently online, who no longer want to live two hours from town doing their washing in a basin, they want their own residence to go to the modest bank, hospital, govt job, aircon and IT jobs etc etc that are all in town. Most can't afford houses close in and in any case many will opt for a condo the same way some people all over the world choose them. Who's going to tell them sorry the guys on Thaivisa say you got to build a little place on the family plot and stay in the village for your life just like grandma. Or despite the fact you can afford your own place don't buy it, go live in a truly small 2-5000 baht haw puk, which you'll never own. 

This demographic has filled up places already....... all the One Plus condos as an example.

Do we know how many more places they'll fill?

No we don't.

We can guess there's an oversupply or someone can come up with some fact based estimates.We can also guess at how much time any oversupply will take to be absorbed.

Anyone who tells you the answer is blowing smoke up your jacksy.

[trogers]

Capital control - The New Great Wall

 

Not that the Chinese doesn't want to invest in residential properties overseas, the unbridled amount of capital flowing out is draining the country's account surplus.

 

Chiangmai is just one of the victims across the globe.

[Naam]

1 hour ago, trogers said:

Capital control - The New Great Wall

 

Not that the Chinese doesn't want to invest in residential properties overseas, the unbridled amount of capital flowing out is draining the country's account surplus.

 

Chiangmai is just one of the victims across the globe.

Quote

 

China's Foreign Reserves Rise for a Sixth Month

August 7, 2017

China’s foreign-exchange reserves posted a sixth straight monthly increase as the yuan strengthened and economic growth remained robust.

 

Key Points

• The foreign currency stockpile climbed $23.9 billion to $3.081 trillion in July, the People’s Bank of China said Monday
• Level compares with a $3.075 trillion estimate in a Bloomberg survey
• https://www.bloomberg.com/news/articles/2017-08-07/china-s-foreign-reserves-rise-a-sixth-month-on-yuan-strength

 

[trogers]

Capital Control stamping capital outflow

 

Money was leaving China at up to US$60b a month.

[cheeryble]

50 minutes ago, trogers said:

Capital Control stamping capital outflow

 

Money was leaving China at up to US$60b a month.

Thats a lot of bitcoins to carry 

 

 

[Number 6]

On 10/13/2017 at 12:51 PM, InMyShadow said:

Absolutely miniscule in the big picture. Literally a granul of sand in a desert.

Millions of condo's successfully built.
I bought 2 off the plan no worries 12 years ago when they were peanuts and now just around the corner at Nana bts the Q condo is rising fast at 1 million USA dollars entry level up to 4.6 million USA dollars.

Had I stayed a renter no way could I afford a new condo today.. Sadly the renting fence sitters waiting for the baht to implode and the bubble to burst are doomed to renting for life

I see huge value in renting given the vagaries of the primary and secondary condo markets not to mention the condo management mafias and the airbnb scousers.

 

Further, until the last five years, now married I would have had no interest in buying in Thailand because I was never in love with it enuff to commit to it forever in a condo purchase.

 

The only reason I'm even contemplating a buy is to leave the wife something more than money. Still, I'll have to live in it for the balance of my life and while BKK is ok, I need a beach. 

 

I see many, many reasons not to rush in but if you're happy, I'm happy for you.

 

Miami is cheaper.

[Naam]

4 hours ago, Number 6 said:

Miami is cheaper.

Mogadishu, Mazar-e-Sharif and Kinshasa are cheaper.

[cheeryble]

14 hours ago, Naam said:

Mogadishu, Mazar-e-Sharif and Kinshasa are cheaper.

Bla-haha

You sure you don’t have English ancestors?

[cheeryble]

19 hours ago, Number 6 said:

I see huge value in renting given the vagaries of the primary and secondary condo markets not to mention the condo management mafias and the airbnb scousers.

 

Further, until the last five years, now married I would have had no interest in buying in Thailand because I was never in love with it enuff to commit to it forever in a condo purchase.

 

The only reason I'm even contemplating a buy is to leave the wife something more than money. Still, I'll have to live in it for the balance of my life and while BKK is ok, I need a beach. 

 

I see many, many reasons not to rush in but if you're happy, I'm happy for you.

 

Miami is cheaper.

You got married and you’re still in love with it? 

[trogers]

20 hours ago, Number 6 said:

I see huge value in renting given the vagaries of the primary and secondary condo markets not to mention the condo management mafias and the airbnb scousers.

 

Further, until the last five years, now married I would have had no interest in buying in Thailand because I was never in love with it enuff to commit to it forever in a condo purchase.

 

The only reason I'm even contemplating a buy is to leave the wife something more than money. Still, I'll have to live in it for the balance of my life and while BKK is ok, I need a beach. 

 

I see many, many reasons not to rush in but if you're happy, I'm happy for you.

 

Miami is cheaper.

When you need a beach, you better choose a city that does not view the fronting sea as a huge sewage pond...

[ExpatOilWorker]

16 hours ago, Naam said:

Mogadishu, Mazar-e-Sharif and Kinshasa are cheaper.

Mogadishu just reduced their real-estate inventory, but I doubt it will help prices much.

[Number 6]

22 hours ago, cheeryble said:

You got married and you’re still in love with it? 

With my wife? Yes, absolutely. Despite a bit of agro from living with another person, yes. She's as lovely as the day I met her nearly eight years ago. I can trust her implicitly with money or valuables and her family while common folk are earnest and hard working. We might have returned to States but when I'm gone, shell just want to be back here. I'd rather be here, at least for next 7-8 years.

 

In love with Thailand? Not so much and never was but it's always been a great place for RnR. The lack of democracy, future flooding issues for BKK, the marine ecosystem has collapsed, thb is ridiculously high, foreigners cannot own property, inherent and endemic corruption and the fact I'll never hold pr let alone a passport - it serves a purpose. It's a comfortable place to live and a cheap place to base ourselves for trips abroad. I've also launched a second career that is working out quite well.

 

Thank you for your concern

[Number 6]

I've had the thought for years and someone has posted similar, with the financial outflows from China and all the black money that needs a home here - does anyone get the impression that this is truly what is propping up the condo markets? Jus thinkin

[trogers]

1 hour ago, Number 6 said:

I've had the thought for years and someone has posted similar, with the financial outflows from China and all the black money that needs a home here - does anyone get the impression that this is truly what is propping up the condo markets? Jus thinkin

Not since 2015. What is propping the developers is cheap money looking for positive yields by buying debentures, when the bond market in developed countries are giving negative yields.

 

Negative Yields