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IT'S A BUYER'S MARKET

Rasa is moving ahead with four projects despite the present dire economic situation After making its mark in central Bangkok with the development of the Wilshire condominium in Sukhumvit soi 22, Rasa Property Development is now fully focused on completing four more projects - two high-rise condominiums and two housing estates in northern Bangkok. Managing director Acharaporn Siriphaivan said that although Rasa has been affected by the global economic downturn, the impact has not been strong. As she sees it, although everyone is tired of coping with the lingering global financial problems, those who have experience and fiscal discipline - and are not too aggressive - will be able to cruise along safely. "This is because things did not suddenly collapse, and the situation has dragged on for two to three years now," said Ms Acharaporn. Her viewpoint shows in this company's current strategy because although it is expected that some developers will now turn to building more houses and low-rise condominiums, because these are quicker to complete and thus easier to manage financially, Rasa has a well balanced basket, with two of each type. The launch of Rasa Parkland in the Vacharapol area in mid-2008, when local political tensions were high, was not really an act of daring, but simply reflected the fact that the company did not want to wait as the facilities had all been built. The single houses at the new estate are slightly cheaper than those in the Rasa Spanish Courtyard in Kaset Niwamin, starting at 3.8 million baht compared with about five million baht at the latter, although there are some costing more than four million baht. The two condominiums, the Lighthouse across the river from the Shangri-La Hotel and Intro in the Phahon Yothin-Pradiphat area have studios for sale at a little more than two million baht each. However, Ms Acharaporn quickly pointed out that her studios are quite large and in other developments this size tends to be divided into one bedroom. Rasa's strength is that each project has its own unique concept. The Intro's slogan is "Intro to Your Perfect Life". With a park in front, it is aimed at those who seek healthy green living in the inner city. On the other hand, the Lighthouse should live up to its slogan "Complete City Lifestyle by the River". "From our viewpoint it's complete because the view is good, it's convenient and comfortable in every way, and so the character of the two projects differs and it depends on what clients prefer," said Ms Acharaporn. While the outlook is generally gloomy at the moment, she is upbeat about sales because she sees this to be a golden year for property buyers as they would benefit from prices having generally dropped since last year. And the government's recently announced stimulus package includes a new personal income tax deduction on mortgage-loan principal payments of up to 300,000 baht per year. Under existing rules, only interest payments of up to 100,000 baht per year can be deducted from personal income tax. This tax incentive will apply only to new homebuyers who make purchases this year. "I think the timing is right because buyers will benefit from low prices and the 300,000 baht tax cut. And interest rates are also low, so all these factors mean it should be very good for buyers." Ms Acharaporn also lauded the extension of earlier tax cuts for the property industry for another year, until 2010. Under this package the business tax rate has been cut from 3.3% to 0.11%, the transfer fee from 2% to 0.01% and mortgage registration to 1%. Rasa's boss does not ask for any more help for the property industry, but instead urges the government to focus more on the country itself. "They are so much smarter than us, so we hesitate to speak out, but we do see that sometimes prioritising can resolve overall problems and if these can be sorted out then every business sector would benefit." Ms Acharaporn also questioned the move to introduce inheritance and property taxes, pointing out that the government should not just copy one aspect of a system in the West and ignore the other important facets. "If you ask about the UK and Europe, they have money to help their people, after people retire they get money from the government. For this reason if you want to use any one pattern then bring in the whole thing and not just one part of it - bring in the whole package and look at it to see whether it is balanced. Don't just bring in the positive or negative side. I don't agree with only bringing in the positive side." She also cautioned that it remains to be seen whether this government can get its policies approved by Parliament, because if not these plans would simply sink. While buyers have a lot of factors in their favour right now, Ms Acharaporn urges people to spend more time in selecting property they want to buy and choose something that really suits them. "Condos have both plus and minus points, as do houses, but there was a period when people rushed to buy condos because they were something new, even though they did not have a lot of information about the units. Understanding the product is important, and today people are beginning to understand that. But at one time when I saw everyone rushing to buy condos I wanted to ask whether they were buying because it was fashionable to do so and whether they really understand what a condo lifestyle means." Bangkok Post Feb 15, 2009

 

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