PROPERTY MARKET: ?Now is the time to buy?

[Paillote]

suadum said:

What is your metric for that? Please enlighten us idiot techies who are not financial analysts!

 

Cheers,

SD

 

I am not a financial analyst either, but GDP is growing nicely. Good trade balance with exports record high (though so are imports much due to high oil rises). The high oil prices will likely knock 1-2 percent off the GDP growth, but nothing dramatic. Lots of good second quarter earnings reports were just released, and as I write this the SET is rallying for third day in a row.

 

Paillote

[gummigut]

I question trade balance and your SET points.

 

The trade surplus from Jan to June (latest stats available from BOT) is only US$54 million.

 

Total trade exports over that same time is US$45,359. The cumulated trade surplus is a drop in the bucket.

 

Forecasts of higher oil prices and higher interest rates has quite a number of analysts predicting slower exports while imports will remain steady. Thus the possibility of a trade deficit for the year is a very good possibility.

 

As for your 3-day SET rally, how is the rally performing since the beginning of the year?

 

Sorry, I'm just a cynic

 

<<burp>>

[Paillote]

gummigut said:

I question trade balance and your SET points.

 

As for your 3-day SET rally, how is the rally performing since the beginning of the year?

 

Sorry, I'm just a cynic

 

<<burp>>

 

Yes you are And to answere your question it is not good at all. But the SET is only by small means an indication of how the economy is doing. It is more the sum of what a gang of crazed gamblers are putting in and out of the worlds largest casino. Who said gambling was illegal in Thailand?

 

Paillote

[New Petchburi Pete]

We purchased a nice home in East Pattaya in early July.

Good roads, schools, hospitals and a lower cost of living than BKK were important factors. ... not to mention far less traffic, noise, pollution, proximity to Jomtien Beach, etc. We bought into a highly sought after development, that is well located. It's nice in East Pattaya. Most couples are farang-Thai, so the potential for future appreciation and resale are there.

There is a general belief that most Thais with money are reluctant to purchase second hand homes. This is not the case in developments that are chiefly comprised of farang-Thai couples. In my opinion, East Pattaya represents good value for your money. Housing prices have definitely been slowly rising.

The home we bought was only six months old ... built by a nice gent from the U.K. and his Thai wife ... he realized a small profit; and, would not have sold except that he's being relocated back to England.

The market is very active even in the low season in this area.

There are some very high end homes being constructed ... I'm not sure what type of value they represent however.

[Guest]

PROPERTY MARKET: Prices are SkyHigh ?Now is the time to buy?

 

 

Article from Ramesh Chandamani

 

Asean?s middle class is rapidly emerging as a powerful force for growth.

But just how big is this middle class? In a recent white paper on trade and investment, the Japan External Trade Organisation (Jetro)

estimated there were 30m Southeast Asian consumers capable of sustaining a middle-class lifestyle, 6% of the region?s total population.

This is similar to data we compiled, which estimate 36m consumers with per-capita income of more than US$5,000. These are people who shop

at Carrefour, buy flat-screen TVs on credit and worry about making mortgage payments on their new houses.

 

Assuming per-capita income for Asean4 consumers continues to grow by the past-five-years average of 5.6%, per-capita

income for the region would reach US$2,000 by 2010. Malaysian per-capita income should reach US$6,000 a head and Thai

per-capita GDP should be just over US$4,000. By which time, Southeast Asia?s combined GDP will also have well

surpassed US$1.0tr in economic activity, compared with US$710bn at present. Given that 65% of the region?s GDP is

consumption-related this equates to the second-largest consumer economy in Asia, a point McKinsey & Co allude to above.

 

 

Assuming 20% of individuals earn enough to be classed as middle-income by then, this translates into 103 million

people. Chris Wood is even more bullish: in his 2002 report Asia?s Billion Boomers he estimates there could be

as many as 124 million middle-class Southeast Asian consumers by the end of the decade. The point here is that

the ongoing explosion in the middle-class masses will lead to a tremendous growth in luxury consumption, credit

and services such as tourism and healthcare. This is a sizeable market and one that is increasingly integrating

as trade barriers are dismantled and policymakers accelerate economic linkages.

 

 

 

 

This region will be the global engine for growth for some time to come.

[New Petchburi Pete]

One thing to keep in mind, if you might all be interested in sellling in the future, is that you want to purchase in an area or development where the number of Farang-Thai couples is

considerably higher than Thai couples.

 

Apparantly, many, if not most Thais, prefer to purchase new homes. Farang-Thai couples are the targeted consumers for used real estate. This is particularly true when it comes to single family homes. Thus, an area such as East Pattaya is more likely to be a better investment in terms of appreciation and future resale value compared to say, Bangkok.

[Oldtimer]

Yes, there is a glut of high end condos on the market in Bangkok. I know, because I have invested in two or three construction schemes. I should think it will take a couple of years to clear this over supply, during which time some good deals can be made by canny buyers.

 

At the same time, I believe that house and condo prices to the south and east of Pattaya could double over the next five years as there is likely to be a huge surge of Thai and farang buyers moving into the area with its excellent connections to the new airport.

 

Don't ask me about Phuket! I am amazed at the number of town villa and condo resorts under construction on the island. Its mostly off-shore buyers so far, but with the cheaper air tickets you will soon see more middle class Thais buying holiday homes down there also.

[New Petchburi Pete]

I, myself, would be afraid to purchase a condo in BKK ...

some feel that there is the potential of another economic

crash ... like in 1997.

 

I agree with your opinion about homes in Pattaya/South Pattaya/Jomtien. Prices steadily increased over the past couple of years ... not sure by what margin though.

 

In terms of realizing a profit, location is critical, and by that I mean the house should be in a very secure development, which is well maintained, etc. I believe it's best not to buy the cheapest or most expensive house

in the development if considering future sale. Also, don't fall for the extras that most builders push & many fall for ... reason: next buyer may replace items if his/her tatse is different. An exception to this would be insulation in roof ... wise choice. If you have a home built, insist upon more electical outlets, and make sure the place is well grounded.

 

In Pattaya & Jomtien, condo prices are still going up; but, some may be good investments when you see how poorly your money does in a Thai bank.

[New Petchburi Pete]

Are 'they' building a casino in Thailand?

 

... if so where? ... and, this would be the world's largest?

[Zorro]

I see very few advantages in buying property in Thailand.

It is really easier to rent even if you are living in Thailand.

Rental costs are relatively cheap and you can move around as you see fit.

It is better to keep your money offshore in proven investments rather than taking unecessary risks in Thailand where as a farang you have very few legal entitlements if things start to go bad.

I suppose there might be some people who have made money off property in Thailand but not many and nothing compared to the Australian property market.

For most people Thailand is for spending not making money.

There are just too many sharks in the water in Thailand.