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Tuesday, 29 July 2008 |
source: Bkk Post July 28 2008
The number of new land allocation permits for low-rise units in the
first half declined by 26% year-on-year with a major drop found in Bangkok,
according to Bureau of Real Estate Business Promotion of the Land Department.
In Bangkok, the number of new land allocation permits and subplots
dropped by 38% and 11.8% respectively. Among 36 permits, some were sought by
large developers including Land & Houses (LH), Preuksa Real Estate (PS),
Quality Houses and Sansiri (SIRI) and middle-sized developers including Rasa
Property Development and Sena Development.
Bangkok's four neighbouring
provinces were more active with a total of 59 permits. Samut Prakan had the
largest number of permits, followed by Pathum Thani, Nonthaburi and Samut
Sakhon.
In Samut Prakan, well-known developers seeking permits were LH,
Magnolias Quality Development Corporation (MQDC) and Ananda Development. All
were in Bang Phli district.
PS was the most active in Pathum Thani with
five permits in Klong Luang and Thanyaburi. Others were Prinventure and Sena
Development. In Samut Sakhon, two of the three permits were sought by the
Property Perfect subsidiary Krungthep Land & House.
In Nonthaburi,
listed developers applied for 11 of the 15 allocation permits. They were
Supalai, LH, QH, SIRI, Areeya and Prinsiri's subsidiary Prinventure.
In
other provinces, Chon Buri was the most active with 24 new permits, 16 in Bang
Lamung, followed by Chiang Mai and Prachuap Khiri Khan - all in Hua Hin. The
only listed developer active in the provinces was LH with a housing estate in
Khon Kaen's Muang district.
The bureau reported that among five
categories of subplot properties, the number of new land allocation permits for
shophouses in both Bangkok and the provinces was down sharply.
However,
the other four types of property in Bangkok and provinces moved in opposite
directions. The number of new land allocation permits for single houses, duplex
houses and land plots dropped year-on-year in Bangkok but rose in the provinces,
while those for townhouses increased in Bangkok but decreased in the provinces. |
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Tuesday, 29 July 2008 |
source: Raimon Land/Bkk Post July 28 2008
In a climate clouded by rising
construction costs, an uncertain political situation and a stagnating world
economy, demand for luxury condominiums in Bangkok and Thailand's resort areas
remains strong with sales exceeding targets.
This strong performance
reflects the positive sentiment among investors that Thailand's property sector
can continue to expect sustained demand throughout this year and beyond. This is
particularly true of high-end condominiums, which are driving the market
forward.
Last year, despite political tension, inner-city Bangkok
condominium sales rose 3% thanks to a second-half surge. Achieved prices and
sales performances were particularly strong, with investors prepared to pay an
additional 50% over the median price to secure the finest inner-city properties.
While political instability dented international buyer perceptions and
some investors held back, a remarkable resilience remains, particularly from
regional buyers who recognise the long-term value, low cost of living and
lifestyle appeal of Thailand.
Those who are familiar with Thailand and
visit frequently on holiday are still buyers, but first-timers out of Europe are
far more circumspect about decisions.
Residents of Asia seem less
concerned about political instability, particularly expatriates based in Hong
Kong, Singapore and Shanghai, who see good potential for a second home, a
retirement home in a terrific location, or a solid investment opportunity.
An good example is The River,
Raimon Land's high-end lifestyle project
on the Chao Phraya River, where higher-than-expected takeup has lifted sales
past seven billion baht in June, or 58% of the targeted 12 billion.
This
surge in demand, more than 800 million baht over the target to date, prompted
the release the project's South Tower's higher units earlier than planned.
Since pre-launching the 851-unit project in March 2007, during which the
limited number of units released were sold within three days, 492 condos have
been incrementally released, with 418 sold through June.
The industry
confirmed its recovery by getting off to a strong start in 2008. Sales in The
River for February alone topped one billion baht, and all subsequent months,
except April with the Songkran holiday, surpassed their target of 300 million.
Research published recently by Raimon Land in its Condominium Focus
Thailand, shows that condominiums have become the fastest growing segment in the
residential property market, with luxury developments emerging as an alternative
for many local investors who traditionally looked to the mid- and lower end of
the sector.
The launch of new projects is also generating buying
interest among investors, and a broadening economy is underpinning demand for
quality residential assets.
The 47-storey, 196-unit Sukhothai Residences
is testament to this, attracting strong interest since its launch late last
year. A total of 70% of the units have been sold for between 205,000 and 343,000
baht per square metre.
To many, Thailand remains fundamentally one of
the more attractive Asian destinations, with economic growth expected to
maintain its 4% to 5% pace over 2008 and 2009.
Currently, foreign buyers
account for the bulk of condominium purchases in Thailand's resort areas, though
the most active markets have changed.
The profile of Raimon buyers in
2007 shows Russians catapulting from outside the Top 10 to lead resort
condominium purchases with 23% of the total value of funds, followed by Thais
(15%), British (10%) and Australians (9%).
The bottom line is that
property pricing is still tremendously low if compared to regional or
international markets.
Investors are also realising impressive returns
in top resort areas. Pattaya offers a superb opportunity to realise both strong
short-term gains as well as long-term growth through investments in Grade A
condominium developments.
Raimon Land launched the 376-unit, twin-tower
Northpoint project - located on a 12-rai beachfront site at Wong Amart - in
November 2006, and to date, it has achieved an average per-square-metre (psm)
price of 120,219 baht on the 252 units sold.
Sales at Northpoint remain
brisk in 2008, with buyers signing up for 59 units worth 591 million baht at an
average price of 120,592 baht psm from Jan 8 to March 11.
Raimon Land
remains confident in Thailand as exhibited in our recent launch of The Lofts
Southshore in Pattaya, a high-quality, mid-range development combining resort
living with a modern urban lifestyle. First-day sales exceeded 730 million baht.
This project brings Bangkok's established "The Lofts" lifestyle concept
of providing a quality modern urban design and functionality at an affordable
price to Pattaya, and has the potential of returning strong capital gains and
high rental yields.
The 330-unit Reflections Jomtien Beach Pattaya has
also seen strong results with 50% of its units already sold at prices starting
at 100,000 baht psm, which again demonstrates that there remains strong demand
for luxury condominiums in Thailand, despite the ongoing political turbulence.
Nigel Cornick is Chief Executive
Officer of Raimon Land Plc
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Tuesday, 29 July 2008 |
source: Bkk Post July 26 2008
The take-up rate of single houses and townhouses in the first six months almost
doubled year-on-year due to government tax incentives and a mass transit
kickoff, according to property consultant Agency for Real Estate Affairs (AREA).
Managing director Wason Khongchantr said pent-up demand from last year
was stimulated by the tax incentives. Most homebuyers shifted to buy low-rise
units instead of condominiums as they would get tax benefits before they expire
on March 28 of next year.
Single houses sold in the first half of 2008
totalled about 9,000 units, rising from about 5,500 in the same period last
year. Townhouse sales were around 10,000 units, up from 5,000.
On the
contrary, condominium sales sharply declined from 20,000 units to 14,000 units.
However, oil prices would be a positive factor boosting condominium sales in the
second half of the year, he said.
Another positive factor boosting
condominium sales would be a great shift of money from bank savings to real
estate investment as the government changes its policy next month to only
guarantee deposits of one million baht each.
''Condominiums are easy to
invest in as buyers can rent it out. But new supply is restrained by higher
construction costs, environmental regulations and stricter construction
permission,'' he said.
During the first half of the year, real estate
sales in Greater Bangkok totalled 37,000 units, up 16% from 32,000 units sold in
the same period last year. AREA expected around 75,000 units sold in 2008, up
from 65,000 in 2006.
''If there's no severe situation in the politics in
the second half, the Bangkok property market will recover this year because of
increasing demand as buyers will make rush decisions during an upward trend in
construction costs and higher inflation rates,'' he said.
Another factor
boosting the Bangkok property market would include foreign investment in real
estate which should resume this year.
In the first quarter of 2008,
foreign investment in the property sector in Bangkok totalled 17 billion baht,
according to the Bank of Thailand.
Mr Wason anticipated that foreign
investment would bounce back from 30 billion baht last year to 50 billion baht
in 2008, the same amount as in 2006.
He said that he government's
kickoff early in the year of the development of the purple mass transit line
stirred demand in single houses and townhouses in Bang Yai and Bang Bua Thong
areas.
There are a total of 1,335 residential projects with units
remaining for sale. Those with over 20 units totalled 823 projects with a total
of 408,594 units worth around one trillion baht or an average price of 2.626
million baht a unit.
Of the total,
299,420 units or 73% were sold. Residences remaining for sale in Greater Bangkok
totalled 109,174 units, with 33,000 single houses, 27,000 townhouses and 35,000
condominium units.
Developers launched a total of 154 residential
projects with 37,660 units worth 90.79 billion baht in the first half. |
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Friday, 25 July 2008 |
source: CBRE/The Nation on July 21, 2008
Most of the freehold land
recently acquired in Bangkok's central business district has been for
residential developments and hotels rather than office buildings.
In the
next four years, office space will be limited and rents are expected to continue
to rise. The demand for offices would probably be much higher if Thailand
promoted itself as an attractive location for companies providing services to
the domestic economy and developed Bangkok as a suitable city for their regional
headquarters.
One of the drivers of demand for office space is demand
from multinational companies (MNCs). Other Asian cities, such as Singapore, Hong
Kong and Shanghai, have benefitted greatly from such demand, both in terms of
benefits to the property sector and in terms of jobs created for locals. These
countries have established policies that provide incentives to encourage MNCs to
use their countries as a place to establish a branch to serve the domestic
economy and conduct regional and global operations.
Thailand's abundant
land and major ports, and its improvements in infrastructure and transportation,
including the mass transit systems, as well as its ability to offer value in
terms of quality of office and residential accommodation against cost, make it a
suitable location for service industries as well as a manufacturing base.
There are many reasons why a company chooses to set up operations in a
particular country instead of another. One is accessibility; Thailand,
especially since the opening of the new airport, is as easily accessible as any
other country in the region. The size of the local economy is also often
important and Thailand has developed rapidly over the past two decades, even
though it trails regional competitors, such as Singapore and Shanghai, in terms
of infrastructure.
Other, more significant reasons concern government
incentives. Some countries, such as Singapore, offer a strong package of
benefits to any company that sets up its regional headquarters there, or wishes
to provide services to the local economy. These benefits include lower taxes,
easier authorisation for the employment of foreigners (work-permit rules and
visas), limited bureaucracy and others. In short, these countries make it easier
for companies to set up an office.
Also important is the quality,
training and availability of local staff. While a company setting up regional
headquarters will no doubt hire foreign workers, a sizeable portion of the
workforce will be nationals of the host country.
Thailand has been very
active and successful in attracting foreign-direct investment in the
manufacturing sector but continues to lag behind competing countries in
attracting investment in the service sector and regional offices. We need to
boost the office market as well, to create jobs that employ the next generation
of Thais who are entering the market with suitable qualifications.
There
will also be knowledge and knowhow transfers from foreign workers to local
staff, all of which will definitely add value to Thailand's overall economy.
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Friday, 25 July 2008 |
The Nation July 24, 2008
Global money eyes island property
Developers and foreign property funds from Pakistan, Bangladesh, India,
the Middle East and Europe are mulling investment in residential and hospitality
projects on Phuket, collectively worth up to Bt100 billion, before the end of
2010.
Huge returns on investment are behind the rush. One survey by
property consultancy Colliers International Thailand has found that property
investment in Phuket generates returns of up to 100 per cent within two years.
Risinee Sarikaputra, head of research, said 17 new residential projects
worth about Bt20 billion would be launched this year. As well, property funds
from Pakistan and Bangladesh and India's Taj Exotic Group are planning both
residential and hospitality projects in Phuket next year and in 2010 worth
nearly Bt50 billion.
UK investor Gulu Lalvani, founder and chairman of
Binatone, a global leader in communications technology, has also spent nearly
Bt10 billion on residential projects and a luxury retail development in Phuket.
Risinee said Taj Exotic was the largest investor. It is one of India's
leading property firms, with residential and hospitality projects in many
countries. It is expanding its business in Thailand through a joint venture with
Thai partners.
Taj will buy 30 rai of land on Koh Lone, off the
southeastern coast of Phuket, and spend Bt7.6 billion to build just 49 luxury
residences. Each of them will sell for about Bt314 million. Taj also plans to
spend nearly Bt5 billion to build a luxury hotel on Koh Lone by the end of next
year.
Risinee said the property funds from Pakistan and Bangladesh were
strongly interested in investing in Phuket and nearby provinces like Phang Nga
and Krabi. They have an investment budget of nearly Bt10 billion to spend over
the next two years.
Up to 90 per cent of residential buyers in Phuket
are foreigners, especially from Europe, the Middle East, Scandinavia and Asia.
Most of them buy under conditions of a 30-year lease, renewable for a further 30
years.
Nearly 95 per cent of new investors in Phuket are also foreigners
who set up joint ventures with Thai partners, in order to comply with Thai law
covering land ownership.
Risinee said although the number of new
residential units launched in Phuket this year was below last year's figure,
their value had shown strong growth, because they were targeting the luxury
rather than the middle market.
Colliers International Thailand believes
969 residential units will be sold in Phuket
this year, more than last year's 828 units but still below the 1,473 sold
in 2006.
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Friday, 25 July 2008 |
The Nation July 24, 2008
Investment-led buying, strong tourist interest
are aiding demand in the region
The majority of property investors in
Phuket are expatriates based in Asia, particularly Hong Kong and Singapore.
Phuket is becoming popular with property purchasers from many new markets, such
as Russia, Korea, the Middle East and India.
The Phuket property market
is expected to show strong growth despite political instability and slower
economic growth in Thailand, research by property agencies showed.
Property-consultancy company Colliers
International Thailand managing director Patima Jeerapaet said Phuket is
attracting professional investors and international hotel brands. Phuket's
fast-growing real-estate market is supported by a strong tourism market. Phuket
is also an attractive retirement destination. Thus, the increase in interest
from overseas in purchasing property has, to some extent, aided economic
recovery in Thailand.
The company's research head Risinee Sarikaputra
said the number of residential units for sale in Phuket recorded a peak in 2006,
with 1,473 units for sale. The figure dropped last year with 44-per-cent
decrease compared to 2006, due to political instability in the country. This
year, that trend has been reversed.
The majority of property investors
in Phuket are expatriates based in Asia, particularly Hong Kong and Singapore.
Phuket is becoming popular with property purchasers from many new markets, such
as Russia, Korea, the Middle East and India. Their decision to purchase a villa
or condominium tends to be investment-led and they are looking for potential
capital appreciation and possibly rental income. Property-sales transactions by
foreigners in Phuket tends to be in the form of 30-year leaseholds; there are
some sales transactions in the form of freehold, especially for condominiums.
Location, the branding of residential units and property management
remain key to commanding high prices. The projects are integrated with hotels
and the hotel manages the residential component. The hotel also manages the
letting out of the property, or part thereof, on behalf of the owners, generally
through a rental pool system.
Risinee said that from the study, it is
evident that land prices in the western and eastern areas range widely. The
selling price per square metre in some projects on the eastern coast is actually
higher than that on the western coast, although the land price per rai in the
western areas is Bt35 million per rai on an average, while the land price in the
eastern area averages Bt17 million per rai. However, the selling price of
residential units in the eastern area shows the average price of about Bt130,000
per square metre while the selling price of residential units in the western
area is approximately Bt100,000 per square metre.
The east coast seems
to be the future destination for high-end developments in Phuket, with three
marinas in the area. Two additional marinas, which are under development, raise
the area's capacity to 800 yacht berths.
The marinas benefit the
island's real-estate industry because residential projects generally crop up
around them. Such a facility might be necessary for Phuket's tourism industry to
stay ahead because one of its regional rivals, the Malaysian island of Langkawi,
may develop facilities for megayachts.
CB Richard Ellis Thailand, the country's
leading international property-services company, said that the Phuket market is
expected to show strong growth, especially in the high-end market, after the
upgrade of the Phuket International Airport, which will close to double its
capacity by 2010.
Tourist arrivals grew from 2.4 million in 2005 to 4.7
million last year. Roughly 20 per cent of foreign tourists to Thailand last year
visited Phuket.
Infrastructural improvements have also helped fuel
demand. Phuket has three marinas, with another three slated for completion in
the near future. The island's six golf courses include The Blue Canyon Country
Club, the three-time host of the Johnnie Walker Classic.
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