Property prices

[Super Joe]

The point is Sandman a lot of ordinary people on low incomes are now, or will be suffering big time as a result of this (in more numbers than investors!?). Obviously no-one has sympathy for rich investors, but to sneer and mock when people may be reading this who are in big trouble is bad form.
There are HHAD members who were hoping to sell up and move out here but will now have to stay in UK another 5 years now. There are also members who have bought holiday homes here by re-mortgaging back home, they may be forced to sell off and lose money.

Telling people how clever you have been seeing it all coming and profiting from it is a nice touch though

SJ

[lomuamart]

Good points from everyone.
I suppose I'm a "long term investor". I've had my property in London for 20 odd years. Bought just before the big crash and all of a sudden found myself in a negative equity position. Abbey National (as then was) only offered me 3 times salary. People were advising me to sell before it got even worse.
However, I held on by my fingernails - sometimes 2-3 months in arrears - and clawed it all back in later years.
The point, I suppose, is that sometimes good things come to those who wait. Property markets are especially volatile and they occasionally need a period of time to "calm down" before they they can move ahead. It's good weather and storm. Just ride the storm out.
To those members (if there any) who find themselves in the unfortunate position of not being able to move over here as quickly as they might wish, I've only got one piece of advice - and that is to wait. It'll be worth it in the long run.

[cozza]

My mother in-law has been buying and selling land around Prachuab / Petchburi for nearly 20 years and never lost one satang. Why? because she buys cheap and sells only when someone comes to her.

She has land titles as thick as a phone book (I have seen them) and they are the ones with title.

She has ridden out all previous financial meltdowns and bubbles and never lost anything maintaining a comfortable but modest lifestyle.

[miked]

i broadly agree with sandman, however i have no intention of gloating and i think his wording was arrogant. the problem is that many people in the u.k. treat a house as an investment and not a home. if it increases in value it’s a bonus. was anyone screaming when prices shot up.??
no, straight down the the bank and get some equity out of the house. now comes the pain.
miked

[caller]

i broadly agree with sandman, however i have no intention of gloating and i think his wording was arrogant. the problem is that many people in the u.k. treat a house as an investment and not a home. if it increases in value it’s a bonus. was anyone screaming when prices shot up.??
no, straight down the the bank and get some equity out of the house. now comes the pain.
miked

I understand the sentiment, but not sure I agree with it. Do 'many' people treat it as an investment, or as you say, the increased value is a bonus? Must be the company I keep, but everyone I know has a home they have lived at for many years. There are factors such as work, schools, family, community that keep people rooted.

Only three properties in my area sold in July - a busy SW London suburb.

[lomuamart]

miked,
You seem to know what you're talking about (exchange rate threads etc).
People running off and borrowing more money on the basis of one bit of capital is crazy. And yes, there's going to be pain.
If you own a mortgaged house and have any spare money, pay off as much of the capital as you can, as quickly as possible. It worked for me, but there's still a road ahead.

[Jaime]

I've lived in the same house all my married life and don't intend to move. As Caller identified - there are other factors to consider like community etc. No intention of selling the HH house either and hopefully won't have to.

I guess I'm lucky.

It doesn't make me want to gloat though. That's the part I don't understand.

And I didn't get a train set as a kid either! Thank God I'm not bitter!

[redzonerocker]

ordinary people that have budgeted & planned well with their house investment (as a home!!) are in the same boat as the foolish investors.
most took out the special fix term deals that were abundant at the time but are now coming to the end of those deals, no surprise that there are no new deals on the table.
then add;
interest rates rising & sometimes not passed on to the homeowner
the rise in utilities, which average 40%
rocketing fuel, council tax & food bills
income rises of less than 2% when inflation is almost 5%
cheap foreign labour which has forced down prices in many of the industries, particularly construction.
a huge rise in unemployment caused by the influx of cheap labour.

it's easy to say sit it out but if the banks are struggling to survive the credit crunch, what chance is there for the average person

i can only see the sitution getting worse over the next 12 months the way repossessions are continuing to rise & the fact that house prices will never rise again to the level of recent times.
with unemployment rising at an alarming rate too, the future doesn't look very bright
the abundance of cheap labour has ensured wage rises will never increase enough to allow new buyers to get on the property ladder & those already struggling to survive have to compete for contracts with competitors that can import cheap labour with little or no overheads.

it's ok to say competition is healthy but currently the playing field is totally unbalanced.
this i can vouch for personally, being in the self employed contruction industry struggling to survive

[Jaime]

this i can vouch for personally, being in the self employed contruction industry struggling to survive

Me and you both mate. But if it makes a difference (and apologies for going slightly off topic) I do see a little light at the end of the tunnel. I'm involved more at the front end and there do seem to be some new things coming forward now. The housebuilders, after their recent staff purges, now seem to be looking for land again. Except, that is, Taylor Wimpey, who have been abandoned by the banks. The target for new homes is still the same so the government still wants developers to build. The issue is one of affordability. So, the affordable housing sector is about to experience a bit of a mini-boom as developers off load sites to housing associations. It's happening already. Expect these to start on site 6 months to a year from now.

I hope these aren't famous last words!

[Onlyme]

How much of the new prorerty in Huahin is sitting vacant?
On my few sojourns to the big stone, I'd say that 50% were unsold and
unlikely to be sold in the near future.
I'm cash rich, property owner and willing to wait for the crash over here.
Mark my words, there will be some fantastic deals over here in the near future if you are willing to wait.
Onlyme.

[johnnyk]

IMO it's all cyclical. The massive gains over the past several years, whether stock market or property, are now being given back. If you can, by all means, hang on. Eventually things will turn, if they don't we're all phuket anyway.

[Super Joe]

How much of the new prorerty in Huahin is sitting vacant? On my few sojourns to the big stone, I'd say that 50% were unsold and unlikely to be sold in the near future

You're kidding ? Developers (houses) generally build to order using the customers deposit, then stage payments to fund the build.
There are many developments where up to 50% of the houses are empty and the lights are off, the owners are back home in Europe, North America or wherever.

If you are right then there certainly will be property going cheap, we should see soon enough.

SJ

[caller]

How much of the new prorerty in Huahin is sitting vacant? On my few sojourns to the big stone, I'd say that 50% were unsold and unlikely to be sold in the near future

You're kidding ? Developers (houses) generally build to order using the customers deposit, then stage payments to fund the build.
There are many developments where up to 50% of the houses are empty and the lights are off, the owners are back home in Europe, North America or wherever.

If you are right then there certainly will be property going cheap, we should see soon enough.

SJ

Thats not how all the Thai developers work and I was told on my last trip it was increasingly the case with Farangs as well. I looked at many finished ready to move into houses back in April and I have a favourite!

Fingers crossed! And on the crux of a deal with my little old English home as well!

[Super Joe]

Hope it goes well for you mate.

Maybe the big Thai companies go ahead and build in advance of buyers, I'm not sure about them, but they would be doing that because they are cash rich. Knowing Thais they won't drop their prices much/at all unless they have over-stretched themselves borrowing wise??. Thais still will not take offers on land, not 1 Baht.
I know many of the farang developers in town and you always try to have a couple ready and done, but only one's that build ahead at any real rate are seriously minted and would just sit it out from my conversations. They haven't borrowed the money and have payments to meet.

But we shall soon see, if there is a lot of stock and desperate sellers it'll happen in the next 6 months I would have thought?? As I said on the first page of this thread there will be some bargains to be had but I just can't see it across the board.

SJ

[sargeant]

Just putting a few of my thoughts on this
1. People who bought 3/4/5 years ago bought bungalows at 1.5 million baht.
2. That was purchased at 72 baht to the pound 20,800 pounds.
3. If sold today at 61 Baht to the pound for 1.5 million = 24,590 pounds
I don’t know the average price of a bungalow today but certainly the expectation is a lot higher than the purchase price but that can only be realized if a purchaser who is prepared to pay it can be found.
A lot of the purchasers of 3/4/5 years ago did it on credit card debt and refinancing mortgages on their property in their home countries.
Some were speculating on high returns others bought cheap holiday homes the others were people planning on coming here to live permanently.
This last 6 months has changed things drastically! from my sister and our daily chats to RZR, Mags and others the financial situation in the UK and other places around the world everybody is more than feeling the pinch and a whole bunch of uncertainty. The world has woken up to the fact living on debt has severe repercussions and it will not go back to keep on borrowing again.
The questions that rise in my mind are
1. With higher costs back home how many would be tourists haven’t got the disposable income to come on holiday at all
2. How many will stay home because of higher flight costs
3. How many will not come because costs here in Thailand have risen
4. How many will come and have the money to purchase property
5. How many will want to sell at any price to get money back home to reduce their personal debt
6. How many of the speculators will sell to cut their potential losses
7. How many will sell because they cannot afford to visit their holiday home
8. How many will say with the political uncertainty in BKK sod it I am outa here
9. Which will be the first dominoe to fall
I think there is a strong wind and the dominoes are a swayin
I hope the dominoes stay standing here in Hua Hin because it will be my tin shack friends that will feel it most with high unemployment and they cannot jump on a plane to the lands of benefits and social security