Property market picking up

[huahincharlie]

Hopefully this is a good sign. Two different people I have spoken to in the past week have sold properties. One was moving with work and the other is staying in Hua Hin.

[Big Boy]

How long had their properties been on the market? Also, how did their selling price compare with their original asking price?

I feel this additional information will provide a much better guide to how the market might be moving. Even then, there are probably loads of people still trying to sell.

[Korkenzieher]

Yes. Plenty of variables - location, property type and so on. There must be an enormous overhang of people wanting to sell by now and there really doesn't seem to be too many people out there looking.

Phuket published figures (I forget where) from their land office which showed (by implication on transfer charges, land taxes etc.) just how far the property market collapsed. It would be interesting to see similar figures from HH. I have looked, but failed to find...

[TypicallyTropical]

I check several HH real estate web sites every week for more two years now. I still see many of the same properties still listed that I saw two years ago!

[ozuncle]

I check several HH real estate web sites every week for more two years now. I still see many of the same properties still listed that I saw two years ago!

I don't think they care too much about updating their websites.

Four years ago we had picked about 10 properties to view, that suited our requirements from various agents sites. (A lot of the properties were listed on two or three different agents sites, at different prices.)

Of the 10 that we wanted to look at, 6 were already sold. " Sorry we forgot to take that one off."

One that we went to look at in Cha Am, the Thai lady owner was surprised to see us.

Her husband (Thai) had died more than a year previously and she had no idea that her property was on the market.

The websites look pretty but are useless in my opinion.

[tonymaroni]

Hua Hin is one of the most overbuilt areas there is.

That is from my own observation and talking with Bangkok Thai architects.

Look for yourself. All the condos are empty except for a few weeks a year.
Every Thai with money to spare bought something here.
For spec or just to say I have a condo in Hua Hin, proving how wealthy they are.

Sure you have a high season blip every year. But as a market Hua Hin has years and years of unsellable, unused inventory.

Much more coming online soon. Amari, Merracash etc. and must still be hundreds and hundreds more coming as Boathouse comes online over the next decade.

[hhfarang]

Yes, in the past couple of months it has picked up from "completely dead" to "on life support" as far as I can tell, as we have about one a week wanting to view our home now and before we went months without any interest. Still though, most are looking for a real bargain and even though we've reduced the price of our house by 25% from what similar were going for three or four years ago most interested parties want us to sell it to them for half what it is worth. If you have a property under 10 million (and it is valued correctly) I believe you have a good chance during this high season of selling. If over that price (like ours), good luck. I know of one in the neighborhood that recently sold for 17m but I think they were lucky to find the perfect match in a buyer.

[lazerlab]

It is all aboat location, location and location. I bought a very nice house in HH in July 2008 and sold it with a 10% profit in May 2009. If you buy a typical house with a small plot and typically British furniture you will have a big problem to sell. If you buy a modern house with a avantgarde design and decorate it with trendy furnitures the story will be quite different. The problem in the HH aerea is that it is to many bad taste houses for sale. A house with Chesterfiel furiniture style and a concrete kitchen you can forget to sell. The buyers are very selective. They are going after modern design and style. Low life, cheap Charlie houses will not sell. I have never lost money on any of the houses that I have sold. Not in Europe and not in Thailand. If you have bad taste then you will have a problem to sell your house. Simple as that. And I am sorry to say that a lot of the houses that are on the market today are bad taste houses.

[TypicallyTropical]

I check several HH real estate web sites every week for more two years now. I still see many of the same properties still listed that I saw two years ago!

I don't think they care too much about updating their websites....The websites look pretty but are useless in my opinion.

You might be right about the updating of the web sites, however, I personally looked at many of those properties with the agents when I was there in October.

[margaretcarnes]

It is all aboat location, location and location. I bought a very nice house in HH in July 2008 and sold it with a 10% profit in May 2009. If you buy a typical house with a small plot and typically British furniture you will have a big problem to sell. If you buy a modern house with a avantgarde design and decorate it with trendy furnitures the story will be quite different. The problem in the HH aerea is that it is to many bad taste houses for sale. A house with Chesterfiel furiniture style and a concrete kitchen you can forget to sell. The buyers are very selective. They are going after modern design and style. Low life, cheap Charlie houses will not sell. I have never lost money on any of the houses that I have sold. Not in Europe and not in Thailand. If you have bad taste then you will have a problem to sell your house. Simple as that. And I am sorry to say that a lot of the houses that are on the market today are bad taste houses.

I understand what you're saying Lazerlab but to put it like that is a bit insulting isn't it?
'Low life, cheap Charlie houses' - I suppose you mean that IKEA style is preferable and more tasteful than a leather Chesterfield.
At the end of the day it's all down to personal taste how people furnish their houses. It's true that a simple uncluttered and tidy place in neutral tones will give a better impression when selling - so maybe theres a business opportunity for you? Start a styling consultancy for property vendors -should do well in HH at the moment!

[PeteC]

A lot of people have that problem, including my wife. She'll go into a house and decide about it based upon the furniture and decorations, not the important aspects like structure, facing direction and the 100 other things one should inspect and consider. Any house can be made into what you want. Tell the seller you don't want the furniture, reduce the price and get rid of it. If they want to sell badly enough, they will. Pete

[huahincharlie]

How long had their properties been on the market? Also, how did their selling price compare with their original asking price?

Both were recently advertised. I'm not sure about the prices but reading between the lines they were not "given away", so to speak. One I think was advertised for 18m and reduced to sell, but not so much that the owner couldn't buy another property in Bangkok.

It seems predominantly that the property market problems have resulted from the political climate. The Baht exchange rate does not seem to be an issue for Asian buyers, nor for committed buyers from elsewhere, who are not stretching their finances unduly.

[huahincharlie]

I don't think they care too much about updating their websites.

I agree that the agents' web sites are not updated regularly. The standard of almost all of them I've seen is quite unacceptable, considering they're expecting purchasers to part with several million THB. The only quality site is Engels and Volkers, but they are an international firm of course.

[Super Joe]

There seems to be a few indicators pointing at the start of a recovery, possibly, maybe, but as hhf mentions it's easy to pick up from practically zero, but the signs are more encouraging than anything else to me. i wouldn’t include this as an indicator, but we've sold 2 in the last 6 weeks which is as many as the whole year previous, not a seasonal thing as M.E. oil people who'd been looking a while, albeit at discounted prices that could not really be sustained. There's also been twice as many serious-buyer types viewing compared to the whole year previous. The large real estate firms in Bangkok are reporting increased foreign buyers for the 2nd half y-o-y, but again increased from little. no dangerous over-supply of properties due to Thailand economy surviving the global recession, interest rates staying low. Construction sector last 6 months up 15% previous period, tourist numbers up 10% despite the red shirt trouble. Some of the numbers may be fudged a bit, it doesn't all neccesarily equate to Hua Hin, and it doesn't all equate to sales, but there's positive signs from what I've seen.

Oh, the Bank of Thailands house price index shows a bit of an upturn too for what it's worth/how much it relates to here:

Getting down to the nitty gritty I don't believe there's going to be the firesale buyers want regarding houses, because a) there's nothing to set fire to generally, ie: stock, and b) the financial climate here ie: banks relatively strong so lending, coupled with the low interest rate. Hence the few developers that can and have built ahead (generally the large Bangkok firms) are doing so because they have the finances and can service their borrowing easy, this seems to apply to private resales too. There's bound to be a few exceptions, and a few of these massive developments with 50+ budget 2 bed places on 250m2 land, but I’ve not met many looking for those properties, and there's a big risk of it getting completed.

You see projects with half-built or empty houses but generally theres a buyer in place, our developments and those of friends I know are usually at least 50% empty most of the year round, owners aren't based here and don't want to rent them out. Those with 'stock' are in the best position imo, they're valuable assets already paid for, you could sell one off half price next week and feed the kids for a year, or put them in the bank and borrow very cheaply against them which is what actually happens. 1 or 2 sales and the prices will creep back up because the pressures off, that pays the bills for the next 2 years, we've already put ours back up slightly again, not fully to what they were pre-crash, but it gets to the point where it's really not worth selling off-plan properties at those prices, if anyone come and offered last months prices we would honestly say no, if already finished then yes. All very wierd I know.

I don't know about condos in Hua Hin but generally they're divorced from the house market. Not directly related but this months survey of last 130 condo blocks completed over past 2.5 years in Bangkok shows 79% have been sold, (65% sales ratio this year), which by all accounts does not equate to an 'over-supply', the big Thai condo developers operate very differently to that of the last crash here in 1997-99, you see a slowing down or shelving when at early stages ofcourse.

It couldn't be much different from the financial factors that caused the 1997-99 crash here, banks (via BoT) have tightened up their lending practices, then banks borrowed heavily in Dollars off-shore, lent to developers & investors who'd also borrowed in Dollars, interest rates doubled overnight to silly %'s, people couldn't make repayments/were pulling out, the Baht crash meant banks couldn't service the off-shore debts, banks went bust so no-one could borrow, then the final whistle

It's too early to really tell I'd have thought, middle of the year (yes of course 2011) is a more realistic time

SJ

[Korkenzieher]

Joe, I think you are glossing over the fact (possibly deliberately, I don't know) that there are few forced sellers, because primarily there are few mortgages and therefore no foreclosure pressure. If you own outright, you can elect to sell or not, rent or not. I would expect that there are very few actual forced sales, which is why there is no out and out panic and rush for the exits. That doesn't mean there isn't a substantial supply overhang. However, being obviously somewhat closer to the 'coal face' than me, you may have a different view.

Also, on the Red Shirts - to be honest with you, I think that their protests worry people less than the sight of the army charging them with M4's and M16's blazing, whichever side of that particular political divide you feel yourself sympathising with.