Buying a Condominium: Bangkok what and where to buy?

February 1 2010 Categories: Condominium Ownership, Property General Issues, Thailand Property No comments yet

It is always difficult for a new buyer freshly arrived on a market to make an informed decision on what and where to buy? I have been around for 12 years, believe that I have a good understanding of the market but still I learn new things every day. Should you trust your agent to recommend you the best product available. You may, of course but you could also try to find out for yourself what the situation is.

Were to find the right information?

The first source of information is the Real Estate Information Center http://www.reic.or.th which has a site in Thai and english language. You will find a lot of information on this site as to the situation of the real estate market in Thailand. Unfortunately a lot of data on this site is still only in Thai language but there is already some good information.

Another source free source of information is Raimon Land Condominium Focus publication which you can download for free on Raimon Land website at

http://www.raimonland.com/en/condo/Condo_Focus_Aug_2009.p

Unfortunately Raimon Land publication concentrates on Bangkok inner center and Pattaya which are the two markets were Raimon Land is active, but if you want to purchase in one of those two areas this is the document you have to read before to make your purchase, especially due to the fact that this publication is updated every three months and provide accurate and fair information.

Are they any tricks when purchasing a condominium unit in Bangkok?

Yes of course but it is at the end of the day common good sens. Firstly, and I have already said it the most important thing is always location, location, location. The most thought condominiums units right now are those that are next or close to the mass transit system and this is a tendency that will continue on the long term. According to a study from Aquarius Estate Co., Ltd published in the Bangkok post this morning the best condo sales this year were in the Lad Prao and mid sukhumvit area (between Prakanong (soi 71) and Soi Onuj (soi 77) with a rate of sales of 79% and 78% respectively by comparison to an overall rate for Bangkok of 64% (46,137 unit sold out of 71,581 units offered).

What the mass transit offer is to give a valid alternative to buyers who are working in the inner center of Bangkok that may not afford a condominium there. They can buy in areas where prices are lower but may still easily accede it though the mass transit system.

What are the other tricks when selecting your condominium unit?

Another trick is to look at the map of Thai high schools (private schools most of which are catholic schools). Buy a condominium in an area located close to one of this school and the transit system and you will have a winner. Whatsoever happen you cannot lose money on your unit because there will always be parents of students that will want for convenience buy your unit. I personally purchased a condominium in one of this area at 75,000 THB per square meters. According to a Thai bank evaluation my unit is worth now 125,000 THB per square meter (note that the evaluation was made a few months ago while we were still into the worth of the crisis). Note that one of the downside of living near to a school is that traffic will be awful in the morning and afternoon. But this is life you cannot have only advantages.

Another good buy are condominium units located riverside, especially now that the Sky train has finally crossed the river. Here again buy a river view unit near the sky train and you have a winner that is to say a condominium unit which price may only appreciate on the long term.

What are the average condominium units prices in Bangkok?

As to average prices per square meters for condominium units in Bangkok (those are the average prices for the whole Bangkok area, average prices for inner center are far above) the prices have risen by 28% from 2007 to 2008 climbing from 57,600 THB per Square meter to 74,000 THB. However average priced dropped to 70,000 THB in the first eight months of 2009. Still, average prices have risen tremendously since 2007. Not bad when you think that Thailand has suffered from an ongoing political crisis since half 2006 and of the aftershock of the global economical crisis. Especially due to the fact that part of the drop was due to promotions granted by developers to sell their stock.

Why did the prices continue to rise over the period? I think the reason is simple. Developers and banks have learnt from the 1997 crisis and they have regulated themselves, the developers freezing project and the banks by having more rigorous terms and conditions as to loan granted to developers. For example a few years ago banks were still lending to developers that have pre-sold 30% of their project. Now they will have to pre-sale 40 to 50% of their projects to have a chance to obtain a bank financing.

About the Author:

The author Rene-Philippe DUBOUT is a lawyer since 1990 when he was admitted to Geneva bar (Switzerland). He practiced as a litigator there for 10 years until he moved to Thailand in 1999. In 2002 he founded with a group of Thai lawyers Rene Philippe & Partners Ltd a local law firm that specialized in Cross Borders Investments and Real Estate. He has been lecturing in several Thai Universities and a speaker to numerous conferences and seminars. He is the author of a must read book:”How to Purchase Real Estate Offshore Safely: The Case of Thailand”.

http//:www.renephilippe.com

Originally posted 2009-08-26 03:47:05.

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