Old Hippie Posted January 18, 2006 Report Share Posted January 18, 2006 Gadfly1 said: As a natualized US citizen, I'm offended by "citizens born here" type of comments/logic. I And you have every right to be offended. I have lived in Thailand over 10 years, pay taxes (more than some of the wealthiest citizens of Thailand because I declare all of my income), and yet I cannot buy property. Gadfly, My understanding is, there are ways you can own property. I think WYD outlined some of them earlier. Link to comment Share on other sites More sharing options...
Guest Posted January 18, 2006 Report Share Posted January 18, 2006 Why would middle class Thais suffer in the long run if property ownership was opened up to foreigners? I don?t see the economic logic behind this claim. Moreover, it is contrary to the evidence we have about what happens when developing countries open up their markets. As is true with many developing economies, the property market in Thailand is highly volatile, subject to extreme property bubbles and contractions. Property markets fluctuate in developed economies such as the US, but in places such as Thailand with restrictions on foreign ownership and less developed legal protections (the two are related) the property market is much more volatile. If you need evidence, go back five years: Bangkok was a city of abandoned half-built condo and office building projects. Since then there has been a tremendous building boom, and most of it has been fueled by speculation. The change is dramatic. It these sorts of dramatic changes in the property market that cause the most damage to the Thai middle class. They make purchasing property in Thailand like placing a bet at a black jack table in Las Vegas. This is not good for middle class Thais in the short, medium or long run. On the other hand, markets that are open to foreign investment and have stable and transparent legal systems are much less prone to such dramatic cycles. And there is compelling evidence of a strong relationship between (a) openness to foreign investment and ( transparency. When the economies slip into decline and asset prices start to fall, investment from abroad increase demand and thus smooth out dramatic spikes in the property market. Foreigners are not going to come into Bangkok ? where middle class Thais reside ? and artificially drive up the price of middle class housing. By definition, if a price is supported by market demand, that price is not artificial. Moreover, how many foreigners are going to come into Bangkok and buy 5 million Baht homes in the complexes that ring the suburbs of Bangkok? That is where middle Thais live. They are pleasant enough if you live and work in Bangkok, but few foreigners would want to live there. The proof: few do. There are plenty of foreigners living now in Bangkok, and very few of them live out in these suburbs. The few that do, have families, contribute to the Thai economy and work here. We know a bit about the preferences of foreigners because foreigners can, effectively, exercise control over property by employing cumbersome holding company structures. So where do most of these foreigners choose to live. In Bangkok, it is primarily in the Sukhumvit area ? not exactly a middle class Thai area. Or, if you widen the scope to include all of Thailand, you?ll find foreigners in places such as Pattaya, Phuket and Koh Samui. Not exactly the type of places where working middle class Thais reside. You were right about Thailand?s property ownership policies being based on xenophobic nationalism. They certainly aren?t based on sound economics. Link to comment Share on other sites More sharing options...
Guest Posted January 18, 2006 Report Share Posted January 18, 2006 My understanding is, there are ways you can own property. I think WYD outlined some of them earlier. I have already posted on this - there are ways you can exercise control over property, but they are cumbersome and risky. In places such as Koh Samui and Phuket, they fuel fraud and corruption. Lifting the restrictions on property ownership would eliminate many of the incentives for this corruption and fraud. Link to comment Share on other sites More sharing options...
bust Posted January 18, 2006 Report Share Posted January 18, 2006 pe7e said:# The reality is foreign investment in the property market always pushes housing prices up. You are wrong, . # I would rather see them invest in infrastructure rather than place young families at a disadvantage to enter the property market # Again you are incorrect. When openly discussing issues on the board using lines like "you are wrong" gives the impression that you a right when in fact you may be wrong. Maybe try and use your post to put forward an opinion rather than the I am right you are wrong. Just comes across as arrogance. As far as BKK's growth goes have a look at the recent increase in foreign investment. Link to comment Share on other sites More sharing options...
Bangkoktraveler Posted January 18, 2006 Report Share Posted January 18, 2006 OH, I need some clarity. You claimed the Taiwanese are buying up some of the condos were you live and you claim this is preventing you from buying the condo where you are living. Why didn't you buy the condo you are living in before they started their buying process? It wold seem you were not willing to buy the condo in the past and now you claim you can not afford to buy it in the future. So there willing to buy the property has not really effected you one way or the other except in an emotionally way [color:"red"] Link to comment Share on other sites More sharing options...
Old Hippie Posted January 18, 2006 Report Share Posted January 18, 2006 Ok, simply put the Taiwanese, or any foreigner for that matter, is NOT preventing me from buying the condo. I used them as an example, as I did other foreigners in Berkeley etc... Simply put, they are here, as are other groups from over seas, and their presence/interest help drive up the demand, hence the cost. The fact that I am a single income person, bidding against an investment firm with millions, who is offering 20% more than the market price does not help either. The reason I didn't buy before (not that is is any of your damned business) Is I simply cannot afford the real estat in this area. I didn't have the money when it was $200K, and my salary was lower, and I can afford it now that they are $400K. My Condos are currently apartments. They were just bought by a developer, and are being converted to Condos. They all just became available for sale now. I am Not anti immigrant, and I am not against forigners buying a home. All I am saying is, the amount of foreign investment in this area, HELPS fuel the all ready high demand, thus adding to the high price. That is how it effects me. And yes, this is a very emotional topic for me, and a lot of people in this area. OK look, I have stated my position on this, given examples to support it. I believe real estate is a matter of supply and demand. Some have agreed, others not. Some have agreed with me, restating what I previously said, yet want to tell me I am wrong...mine is not a popular opinion. Foreigner investment/immigration is a volitile topic Before someone starts calling me a racist and every other name in the book, I am bowing out of this conversation. I have said what I have to say, you either get the points or you don't, I am tired of repeating myself. Bottom line I believe foreign investment has an impact on real estate prices here in the US, and any market in the world, Including Thailand. I think it would be a bad Idea for Thais to let forigners start buying up land, for reasons I stated. Link to comment Share on other sites More sharing options...
pe7e Posted January 18, 2006 Report Share Posted January 18, 2006 I Appologise if I came over as arrogant, that wasn't my intention, but I stand by the content of the post, what part of it do you consider to be incorrect? The increase in Thai housing prices can't be due to foreigners buying up the land because foreign ownership is illegal under Thai law. # As far as BKK's growth goes have a look at the recent increase in foreign investment. # Yes I agree, that's the point I was making, but this investment is from Thais as well as foreigners and has gone into the infrastructure and manufacturing industry, not into the housing sector. This investment has resulted in increased earnings and employment opportunities for Thai nationals, their subsequent rise in living standards has created the demand for housing, and it is this that has led to the increases in property values. Would you support legislation preventing foreign investment and the subsequent rise in unemployment and reduced earning potential for the educated Thais, in order to force prices down thereby enabling the people on the bottom of the heap easier access to property ownership? A farang buying a 10m des res in Koh Samui won't change the price of a tin shack in Nakhon nowhere, but it will bring a lot of cash into the local community Link to comment Share on other sites More sharing options...
bust Posted January 18, 2006 Report Share Posted January 18, 2006 pe7e said: A farang buying a 10m des res in Koh Samui won't change the price of a tin shack in Nakhon nowhere, but it will bring a lot of cash into the local community This is where I disagree. I admit there are many factors to consider here interest rates, inflation and exchange rates. When you increase foreign investment you increase foreign interest. When you increase foreign interest you increase the demand for housing. OK look at it this way. Company X relocate their R&D facilities to town A. Along with that comes 200 relocated staff and their families. Because they are new to this country and for convenience to their place of employment they all buy properties and settle in a particular area. Unfortunately there is only about 120 properties available in this area. 200 into 120 doesn't go. Factor into this the locals who have also benefited by this new injection of capital from the relocation of Company X to their area in construction and services etc, they also are now in a position to buy into this market. So now you have 280 trying to purchase 120 properties. Basic economics will tell you that when demand exceeds supply the price will increase. The sudden increase in property sales in this area significantly pushes up the average price. A direct result of supply versus demand. So as you can see sure the local community will benefit from the invested capital but it will also effect their ability to live there.Your apology is accepted. Link to comment Share on other sites More sharing options...
Lusty Posted January 18, 2006 Report Share Posted January 18, 2006 Every working resident of any country should have the right to their own affordable roof over their heads. Impossible to make work I know. Link to comment Share on other sites More sharing options...
chuckwoww Posted January 19, 2006 Report Share Posted January 19, 2006 ?Foreign capital has been injected the most into the property sector, particularly from Singapore. For example, a Singaporean company City Development has already bought up to seven or eight buildings in prime areas in Bangkok. So, small and medium players will face much more difficulty,? Anant said. Sawasdi Horrungruang, chief executive of Nakornthai Strip Mill Plc, took it a step further, saying that foreign capital threatens the steel industry as well. ?Business nowadays is not a fight against Thais but against foreign capital. We have to make up our minds about future change. Now, it?s cut-throat business competition. No mercy. FTAs [free trade agreements] or the WTO [World Trade Organisation] have nothing to do with free and fair. We have to catch up,? Sawasdi said. http://tinyurl.com/dznxl Link to comment Share on other sites More sharing options...
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