Foreign demand supporting Thai condo market, Plus Property says

[snoop1130]

Foreign demand supporting Thai condo market, Plus Property says

By The Nation

 

The condominium market has started to recover thanks to foreign demand, according to Plus Property. 

 

Meanwhile, developers have shifted their tactics towards roadshows abroad after realising the exponential growth in foreign demand – from both expatriates and those living abroad – over the past five years. 

 

Low prices, good rates of return when compared with neighbouring countries, the Kingdom’s central location within the Asean region and quality after-sale services make it easy for people to decide to buy here.

 

Anukul Ratpitaksanti, managing director of Plus Property, said the signs of recovery of the condominium market had become more visible since the latter half of 2016, when the number of new projects entering the market increased by 32 per cent compared with the same period of 2015. 

 

Amid the economic uncertainties and the high level of household debt during the period, developers have shifted more towards the mid- and high-income segments. 

 

Developers have also expanded into foreign markets to attract purchases by foreigners and foreign investors, both of which currently pay significant interest to properties in Thailand because of its geographical advantages. 

 

Plus Property’s data for the years 2012 to 2017 indicate that demand by foreign buyers who live in Thailand expanded by some 700 per cent. 

 

Most of this demand – 72 per cent – was for condominium units for residential use, whereas 28 per cent of purchases were for the purpose of investment. Some 21 per cent of units purchased by the latter group were leased out and 7 per cent were resold. 

 

Demand within Bangkok expanded the most, constituting 58 per cent of units sold. Seaside units in Phuket, Chon Buri and Hua Hin constituted the second-highest demand growth (16 per cent, 13 per cent and 6 per cent respectively). 

 

Demand in the tourism cities of Chiang Mai and Pattaya grew by 2 per cent. The three most prominent groups of purchasers were Asians (58 per cent), Europeans (29 per cent) and North Americans (7 per cent). 

 

The most popular price range was between Bt5 million and Bt7 million (31 per cent). This was followed by the price ranges of Bt3 million to Bt5 million and Bt7 million to Bt10 million, each of which constituted 21 per cent of sales.

 

Source: http://www.nationmultimedia.com/news/business/30309974

 

-- © Copyright The Nation 2017-3-22

[robertthebruce]

 

 

Mugs Away.......

[clockman]

They mean Chinese!

[trogers]

Even when that 49% is all taken up, how many % of the remaining 51% is being bought by locals?

 

The obvious answer lies in the coming decade that the developer's sales office is still being run below those large sales and rent signboards in completed projects.

 

This is the reason why those big boys are declaring 2017 - The Year of Real Estate Diversifications!

[KittenKong]

9 hours ago, trogers said:

Even when that 49% is all taken up, how many % of the remaining 51% is being bought by locals?

 

Quite a few new Pattaya/Jomtien developments are more than half sold to Thais, even the upmarket expensive places.

 

And of course in many buildings that are very popular with farangs the farangs will buy from the Thai quota via company purchases.

[Emster23]

Am I to assume this means your average Thai is broke then?

[trogers]

52 minutes ago, Emster23 said:

Am I to assume this means your average Thai is broke then?

Those that are not broke are so for a reason. They are not greater fools.

[trogers]

1 hour ago, KittenKong said:

 

Quite a few new Pattaya/Jomtien developments are more than half sold to Thais, even the upmarket expensive places.

 

And of course in many buildings that are very popular with farangs the farangs will buy from the Thai quota via company purchases.

And how many years ago did these developments completed construction?

 

Do you see this same phenomenon in recent launches of off plan projects?

[heybuz]

Quality after sales service. Mmmmmmm

[0U812]

5 to 7 million in BKK only gets you a studio these days. Amazing how prices exploded! 

[Langsuan Man]

14 hours ago, snoop1130 said:

Most of this demand – 72 per cent – was for condominium units for residential use, whereas 28 per cent of purchases were for the purpose of investment. Some 21 per cent of units purchased by the latter group were leased out and 7 per cent were resold. 

I am supposed to believe an organization that lives and dies by sales, and of course they would never inflate their figures 

 

Plus Property

[NoBrainer]

1 hour ago, KittenKong said:

 

Quite a few new Pattaya/Jomtien developments are more than half sold to Thais, even the upmarket expensive places.

 

And of course in many buildings that are very popular with farangs the farangs will buy from the Thai quota via company purchases.

 

Hard to believe if you take a look around. Many thousands of empty units everywhere in these newer buildings, and big projects failing, from lack of interest. Seems to me there are very few buyers around. Have Evan seen many real estate offices closing down last year as well, as they could not stay open with no sales.

 

there is such an oversupply in Pattaya it would take many years to sell, if they stopped all new development now. Bangkok is a different story. Sales are moderate there, but prices are very high compared to Pattaya. Maybe as much as 4 to 7 times higher per square meter.

[trogers]

Just now, Langsuan Man said:

I am supposed to believe an organization that lives and dies by sales, and of course they would never inflate their figures 

 

Plus Property

I would trust their words when they reveal truthfully the % of unsold stocks in all their projects.

[david555]

"keeping up appearances " ..........what els can they say .....?!

[KittenKong]

3 hours ago, trogers said:

And how many years ago did these developments completed construction?

 

Do you see this same phenomenon in recent launches of off plan projects?

 

Lumpini beach and Baan Plai Haad are two examples of recently completed buildings that had no shortage of farang quota when I checked a few months ago.

[12DrinkMore]

2 hours ago, NoBrainer said:

Bangkok is a different story. Sales are moderate there, but prices are very high compared to Pattaya. Maybe as much as 4 to 7 times higher per square meter.

 

Bangkok is where people go to work and need somewhere to live.

 

Very few need to go to Pattaya.

 

My neigboour has been trying to sell his condo in Jomtien for a decade. It is priced at 20% less than he paid for it new. Sporadic tenants have just about covered the annual costs. I reckon that is about par for the course.

[elgordo38]

17 hours ago, snoop1130 said:

quality after-sale services make it easy for people to decide to buy here.

 

???????????

[trogers]

3 hours ago, heybuz said:

Quality after sales service. Mmmmmmm

 

2 minutes ago, elgordo38 said:

???????????

He was referring to a location like Pattaya. What after sales service would be on his mind?

[trogers]

26 minutes ago, 12DrinkMore said:

 

Bangkok is where people go to work and need somewhere to live.

 

Very few need to go to Pattaya.

 

My neigboour has been trying to sell his condo in Jomtien for a decade. It is priced at 20% less than he paid for it new. Sporadic tenants have just about covered the annual costs. I reckon that is about par for the course.

So you have identified his problem. His selling price should be the total annual rental income from his sporadic tenants X 16.

[elgordo38]

4 minutes ago, trogers said:

 

He was referring to a location like Pattaya. What after sales service would be on his mind?

Good question get back to me if you find an answer. 

[elgordo38]

3 hours ago, trogers said:

Am I to assume this means your average Thai is broke then?

As long as the banks swinging doors don't get locked there is no such thing as a broke Thai. 

[trogers]

13 minutes ago, elgordo38 said:

As long as the banks swinging doors don't get locked there is no such thing as a broke Thai. 

Problem is that banks' doors stopped swinging since the late 2015...

[elgordo38]

7 minutes ago, trogers said:

Problem is that banks' doors stopped swinging since the late 2015...

I have a "watch the world go by" day once or twice a week just sit there and sip my cold beer. When counting all the new vehicles going by I must think that all is well for the present anyways on the bank loan business. There is definitely money going out the bank door. 

[realenglish1]

I simply do not believe this story The Condo market is entering a slump Local punters who own 3 condos cannot get financing

 

and there is a glut of condos on the market for resale

 

This is the truth not a self serving story to try and get foreigners to buy condos here

[12DrinkMore]

1 hour ago, trogers said:

So you have identified his problem. His selling price should be the total annual rental income from his sporadic tenants X 16.

 

You mean give it away free?

 

I'll put it to him. He won't be happy.

 

[Mickmouse1]

Rubbish..The market is saturated with both new and old properties that can not be sold.???

[trogers]

15 minutes ago, 12DrinkMore said:

 

You mean give it away free?

 

I'll put it to him. He won't be happy.

 

Why would he be giving it away free? Say he is getting Bt50,000 in rental income a year. The selling price would then be Bt800,000.

 

This is the investment method of valuation. The asset is only worth as much as the returns it can generate.

[trogers]

1 hour ago, realenglish1 said:

I simply do not believe this story The Condo market is entering a slump Local punters who own 3 condos cannot get financing

 

and there is a glut of condos on the market for resale

 

This is the truth not a self serving story to try and get foreigners to buy condos here

There is a glut of shoebox condo units...

 

There is a shortage of 50-70 sqm one-bedroom units of price range Bt3-4m.

[realenglish1]

36 minutes ago, trogers said:

There is a glut of shoebox condo units...

 

There is a shortage of 50-70 sqm one-bedroom units of price range Bt3-4m.

and that is why I would not buy in this market Too dangerous and there will be a correction  Tells you the builders do not know the market and a other reason for a correction

 

There are a lot of condos for sale from about 5 + million up to 7 million that are in that range 50 to 70 and they are not selling because they are too highly priced

Another reason for a correction To many flag polls in the market now Mark my words Its coming 

[Thaidream]

Pattaya is way overbuilt and the Condo market is bad. I can't see putting any money into the place. Jomtien is different- there may be opportunities there if the price and size are right.  

High end condos in Bangkok will sell but there are few foreign buyers. Hi So Thais who work in Bangkok will purchase them. The land prices are very high in Bangkok and it is difficult to find reasonably priced condos in the city.

Most of the real estate people I know tell me the market is generally bad everywhere.