THAILAND HOUSING SITUATION 2009

Property sales in most centres have slowed & but Thailand is not badly affected by the subprime crises as at April 2009. But properties may drop as people realize their financial situation deteriorates. In places like Pattaya as at November 2008 the tourism figures have dropped 50% and theres many condos not started construction and some have slowed due to the lack of buyers--Pattaya also has a gflut of buildings. More foreigners are staying home as the crises bites into all economies & Thai Banks are not saying much to help with lower interest rates & Bank fees which are over the moon -- the Thai families that owqn the Banks want to extract as much out of people as possible & even the fees to withdraw from another town are not documented and should not be passed on to account holders. It will be a buyers market next year as more Thais need to shed properties they don't need or cannot forfeit on their mortgage payments. Many condo complexes in places like Pattaya have stopped & there will be a surge of unfinished condo units soon as people are now wary of investing in condos that are not finished to completion. Developers rely on at least 22% pre sales to stay ahead of their borrowing and without unless they have the cash they themselves will end up in deep water. In Chiangmai the situation is no better and a lot of this is due to the political unrest which does not assist foreigners wishing to buy in Thailand. Some hotels have been built with thoughts of a Casino happening but theres now too many Guesthouses & Hotels.

[ PROPERTY BANGKOK REPORT ]

BUSINESS SECTORS ASSESS PROSPECTS
Political stability crucial for property market source: Bkk Post

Political stability is key for the country to reinvigorate the overall economy and regain local and foreign confidence to attract investment, say executives in the property industry. Phanom Kanjanathiemthao, managing director of the property agency Knight Frank Chartered (Thailand), said political stability would likely be a lingering issue no matter whether the People Power Party (PPP).

''It's up to PPP ''. Problems may escalate, he said, if PPP tries to keep some of its more contentious campaign pledges, including amnesty for banned Thai Rak Thai executives, Thaksin Shinawatra's return to Thailand and amendments to the Constitution. So far in 2008 the PP Party realize they need to stimulate foreign investment and plan to abolish the proposed foreign Business Act amendments preventing foreigners from certain avenues.

During the past two years, property demand from foreigners has dropped by 50% in Pattaya and 30-40% in Phuket and Hua Hin. Meanwhile, the Samui property market was very quiet due in part to a land-title scandal. The International Herald Tribune led yesterday's editions with a report on the outcome of the Thai election.

''Foreign buyers and investors in property sector are sitting on the fence to see the Thai political situation.'' After political stability, foreign investors are most concerned about the Foreign Business Act (FBA) and capital controls. The new government should clear up these issues, he said, as many investors say that both PPP and the Democrats have economic policies that are more friendly to foreign investors than the economic nationalism of the military-appointed government.

''To reduce and prevent any violence, the country's leader for this time should be a negotiator. He should not be talkative or make destructive comments,'' said Mr Phanom. Teerachon Manomaiphibul, the deputy managing director of Property Perfect Plc, said PPP should be able to set up a new government due to its strong showing, while a coalition of many small parties would be too risky. The stability of PPP-led government will depend on its focus, he said. If PPP focuses on economic policy, the political situation will be stable. But stability will be threatened if PPP's focus is on political issues. ''Political stability is the major factor. If it is stable, foreigners are ready to come back for investment,'' said Mr Teerachon. Government spending on megaprojects and infrastructure will be the key factor to revive growth in the property sector as they generate higher employment, investor confidence and economic expansion, he added.

LAND AREAS: 1 rai = 4 ngarn = 400 wah2 = 1600 m2; 1 talang wah = wah2 = 4 m2; 1 acre = 2.53 rai & 1 ha = 6.25 rai 
To date foreigners may own

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