Crazy land prices.

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Prenders88
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Crazy land prices.

Post by Prenders88 » June 10, 2013, 8:02 am

A small patch of land in the soi where we have our mini-mart has been sold for 6 million baht. It is only big enough to build two shophouses or two town houses. The high price might have something to do with the fact that its location is right in the CBD and close to Nong Prajak Park.


Udon Thani, best seen through your car's rear view mirror.

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FrazeeDK
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Crazy land prices.

Post by FrazeeDK » June 10, 2013, 8:15 am

even outside the ring road on the east side, land prices are getting absolutely ridiculous.. Most "developed" land out this way (meaning someone has dumped and leveled dirt on it) runs around 1.2 million per rai or more depending upon location. One 2 rai plot near us that was "developed" and owned by an acquaintance recently was sold, supposedly to a Farang/Thai couple for 3.4 million Baht. Undeveloped wooded land or bare rice paddy seems to go for around 750,000 per rai.. Of course, the proofs in the selling and within 750 meters of our house there's at least a dozen plots of land totaling perhaps 75-100 rai of land that's had "for sale" signs for 3-5 years and no buyers as of yet (thank Buddha!!).
Dave

plumbers
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Crazy land prices.

Post by plumbers » June 10, 2013, 10:02 am

I heard all this before while working in London , prices going up quick get on the ladder before you miss out ,
also quick i need to buy a holiday home in Spain before i miss out !
Greedy stupid people sucked into a bubble that burst and has left people in tears , be happy and content with what you have , you come into this world with nothing and you cannot take any thing out when you die.
I have lived in Thailand a short time (three years) i came here to get away from the got to have it now brigade but sadly it seems people are also be blindly led along the same path here.

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rjj04
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Crazy land prices.

Post by rjj04 » June 10, 2013, 11:32 am

It is certainly not only Udon Thani province that this land bubble is happening. Recently, I went to a land office in another large Issan city and not only was there no sitting room, there was no standing room. People were waiting outside in the hot sun. People are making money flipping land here. Same story we saw in American house prices, it will be the same ending, as it always is. Meanwhile there is a wealth effect happening and all the flippers are geniuses, until they aren't of course.

If you look at the price for a second-hand Condo in a city like Chang Mai, they have gone nowhere, yet the land they sit on has skyrocketed. Does that make sense?

What can a business built on top of that land... rice field, commercial retail property, apartment, whatever it is, earn as income flow? That is what, in the long run, that land price will be based upon. Either rental rates and agricultural product prices must rise, or the price of the land must fall. I'm betting on the latter.

Let's hope that the bursting of the land bubble doesn't implode the banking/financial industry here. It should be interesting to see. Stay tuned.

Jing Jing
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Crazy land prices.

Post by Jing Jing » June 10, 2013, 12:58 pm

When you look at the condo projects you have to wonder what is going on. Everyone is selling paper. The developers have not broken ground. So are they so under captialized they can't begin the projects. What are they doing with the money they receive? Are they investiting the money or are they using it to pay for their lifestyles.

If the real estate market is being dominated by flippers then it is time to beware.What goes up has to come down. The price for homes do not match reality.

I was looking at a commercial building and for what it cost you could not sell anything that would generate enough income to pay either the loan or provide a return on your investment.

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semperfiguy
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Crazy land prices.

Post by semperfiguy » June 10, 2013, 1:49 pm

Things don't have to make sense when greed is perpetuating the lust for gain, but when you combine stupidity with greed...then you have a recipe for disaster. Thailand is headed toward another cataclysmic train wreck!
Colossians 2:8-10...See to it that no one takes you captive through philosophy and empty deception, which are based on human tradition and the spiritual forces of the world rather than on Christ. For in HIM dwells all the fullness of the GODHEAD bodily; and you are complete in HIM, who is the head of all principality and power.

KB_Texas

Crazy land prices.

Post by KB_Texas » June 10, 2013, 2:15 pm

This is just the sort of thing that happened in the US. A lot of land being bought on credit, with the idea of quickly flipping it for a few thousand more than you paid for it. In Atlanta, corruption was rife, with 'investors' in bed with 'realtors' and 'appraisers', so land and home prices escalated beyond reason. We all know where THAT led...and the economy is still struggling to recover from it.

Here, there is even less oversight, and I can see a serious problem when the bubble bursts. Contrary to what the government officials state, Thailand IS in a bubble. A bubble is when land/homes escalate at a rate that makes it untenable to purchase them. As Jing Jing said...how does it make sense to purchase a land/building when you could not possibly make enough profit to pay the note on it? I had a friend who has been here much longer than me who told me that land that he DECLINED as to expensive (at 58000 a rai IIRC) 10 years ago is now selling in the >600,000 a rai range! I would say a tenfold increase in land prices in 10 years is a bubble, whether it fits the 'accepted' model or not.

It is not going to be pretty here when that bubble bursts I think.

KB

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parrot
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Crazy land prices.

Post by parrot » June 10, 2013, 2:21 pm

Our neighbor has been trying to sell his 12 rai for a year or two. A few lookers, but no takers yet. Not long ago, the wife (neighbor) visited a fortune teller about 80km outside of Udon....he told her she'd sell the land soon. Today, a pack of people arrived to view the land. I went over and introduced myself......I detected a hint of an accent in their Thai. I asked if they spoke English. "Oh, sure!" they responded. "We're from Hong Kong."

Don't know yet if they're going to buy the land.

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Crazy land prices.

Post by thaiguzzi » June 10, 2013, 3:37 pm

Purchased lot #1 23 rai in 2005 for 9000 baht per rai, now worth 200,000 baht per rai.
purchased lot #2 5 rai in 2005 for 11,000 baht per rai, now worth 200,000 baht per rai.
purchased lot #3 10 rai in 2006 for 20,000 baht per rai, now worth 150-175,000 baht per rai.
purchased lot #4 26 rai in 2007 for 40,000 baht per rai, now worth 150,000 baht per rai.
Lots 1 and 2 are next to each other, as are lots 3 and 4. Lots 3 and 4 were purchased from the same seller, one year apart, but double the money. All of it now has rubber on it. recently turned down the above price on lots 1 and 2.
Go figure, and it still has not reached the ceiling yet.

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Galee
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Crazy land prices.

Post by Galee » June 10, 2013, 5:08 pm

I'm an expert when it comes to buying land in Udon (not). 3 years ago bought 1 rai for 750,000. 18 months later sold it for 675,000 and happy to get that. :evil:

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KHONDAHM
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Crazy land prices.

Post by KHONDAHM » June 10, 2013, 6:32 pm

Unlike in America, in the years to come even after post-bubble pop, the price won't adjust downward. Thais don't do that. So, that means future generations of Thais - if they don't already own land - will be azz out and stuck wherever they are. Saw it happen in Hawaii and then saw it happen in Chonburi province. The land price rise is unreachable by the indigionous people/families. That leads to all sorts of other socio-economic problems over time...

Remember Thailand in the years pre-2004 romantically because the future will be anything but! I'm here to the end, but I'm preparing my kids to have an "out".
Enjoy this site much more by adding idiots to your ignore list (Friends & Foes tab).
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rick
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Crazy land prices.

Post by rick » June 11, 2013, 6:33 am

My family have 9 rai for sale. If you have any overseas investors looking for a piece, it is 10 million baht and in Nong Sai.... :-" It was only 5 million 10 years ago, but the buyer pulled out..

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Crazy land prices.

Post by wynnsiensheng » June 11, 2013, 4:39 pm

I reckon thai rice field land is like a Ponzi scheme. The price will keep going up so long as there is someone willing to pay a higher price. But there is no return from just owning it. Rice farming is a break even business at best.

The wife talked me into buying 10 rai of land 4 kms outside the ring road, three years ago for 100k baht per rai. Never made a satang from growing rice, but just sold it for 270k baht per rai. The buyer will never make a satang from rice. But if someone pays more in a couple of years time.....and so it goes on.

A Ponzi scheme in all,but name.

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Crazy land prices.

Post by ronan01 » June 11, 2013, 5:07 pm

It seems the price increases are driven by falang money?

plumbers
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Crazy land prices.

Post by plumbers » June 11, 2013, 5:37 pm

I was under the impression alien cannot own land and cannot speculate in Thailand and if you attempted to take money out of the kingdom you have to explain where the funds come from.
Or may be what i am reading here is what the wife owns and the expat is behind the scenes , i was questioned why i need one million bahts and had to explain eight hundred was for my retirement visa , it seems to me not a problem until you try to leave Thailand with your profits .

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Crazy land prices.

Post by RLTrader » June 11, 2013, 5:42 pm

Since a friend deals in land sales, I have seen the price rise. From what I am seeing the buyers are coming from Bangkok with pockets full. I also am waiting for the crash or Bangkok sinks into the Ocean. Not betting on which comes first.

wynnsiensheng
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Crazy land prices.

Post by wynnsiensheng » June 11, 2013, 7:21 pm

I would say that is true in the sense that falang pay more, but I see plenty of Thais trading land with each other. The buyer of our land was Thai.

I mean I can understand it if the land is on a main road and in an area able to support the construction of some kind of business. But a rice field with no concrete road access? Basically a field approached by a dirt track. Why would it go up in price if there's no change in the surrounding environment or rise in the price of rice. Go figure.

wynnsiensheng
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Crazy land prices.

Post by wynnsiensheng » June 11, 2013, 7:40 pm

Ha, ha, ha, don't think I have ever heard of a falang leaving Thailand with profits. Shirt on his back, yes, but more than that......

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udproperty
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Crazy land prices.

Post by udproperty » June 14, 2013, 8:15 pm

wynnsiensheng wrote:I would say that is true in the sense that falang pay more, but I see plenty of Thais trading land with each other. The buyer of our land was Thai.

I mean I can understand it if the land is on a main road and in an area able to support the construction of some kind of business. But a rice field with no concrete road access? Basically a field approached by a dirt track. Why would it go up in price if there's no change in the surrounding environment or rise in the price of rice. Go figure.
You can finde som of your answer here.

From ddproperty
Foreign property investors are flocking to Thailand ahead of the implementation of the ASEAN Economic Community (AEC) in 2015, according to the Board of Investment (BoI).

Many land purchases are being made by Chinese buyers in the Upper Northeastern part of the kingdom.

In Khon Kaen Province, Chinese investors are in talks to acquire a 2,000 rai plot and develop it into electronic part plants and green industries, said Ratanawimon Naree Sukreekhet, Director of BOI's Regional Investment and Economic Centre 3.

Japanese investors are also showing interest to use industrial estates in the Northeast for their auto and electronic part manufacturing industries.

Ratanawimon added that a big proportion of these investors are small and medium enterprises who are aiming to expand in the Eastern part of Thailand where there is abundance of land.

As demand increases, prices have also spiked in the Northeast - an area which is considered to be flood-free, and a convenient location for product distribution especially into neighbouring countries like Laos, Vietnam and Cambodia after the AEC comes into effect

Andrew Batt, International Group Editor of PropertyGuru, wrote this story. To contact him about this or other stories email [email protected]

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FrazeeDK
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Crazy land prices.

Post by FrazeeDK » June 15, 2013, 7:45 pm

hmmm... "an area which is considered to be flood-free". I reckon that depends on where the region is in relation to its known cycle of drought and floods... Udon has had some pretty bad floods over the years albeit nothing like the 50 year topper Bangkok got back in 2011.. I knew Thais whose homes had 2 meters plus of water for nearly 2 months.. They lost nearly everything....
Dave

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