Hua Hin weighed down by oversupply of condos and houses

Ask here about the pleasures and pitfalls of buying, selling or renting property and real estate in Hua Hin. Building, design and construction topics welcome. Commercial or promotional posts for real estate companies or private properties are forbidden.
Coldmike
Specialist
Specialist
Posts: 126
Joined: Sat Aug 13, 2011 9:29 am

Re: Hua Hin weighed down by oversupply of condos and houses

Post by Coldmike »

The enormous Hua Hin Energy project is nowhere near completion. A few buildings look close, but the bulk of the project has a long way to go. Most of the units fall into the above mentioned group of condos with little or no actual sea view and are quite a long walk to the beach.

Especially frightening is the creative means they plan to pay for ongoing maintenance. Rather than charge a monthly assessment, the condo purchaser pays a 'one-time' fee up front which, in theory, gets invested and funds the maintenance and upkeep. I'm sure their model was based on a certain level of investment rates, but with current and near future rates being so low, the model could break down. Also, if they don't reach a critical level of sold units, the project may not have sufficient funds for this concept. Hopefully, they have really sold 70% of the units and will avoid serious problems.
"I feel sorry for people who don't drink. When they wake up in the morning, that's as good as they're going to feel all day." -Frank Sinatra
User avatar
margaretcarnes
Rock Star
Rock Star
Posts: 4172
Joined: Wed Jan 02, 2008 8:28 am
Location: The Rhubarb Triangle

Re: Hua Hin weighed down by oversupply of condos and houses

Post by margaretcarnes »

Coldmike wrote:The enormous Hua Hin Energy project is nowhere near completion. A few buildings look close, but the bulk of the project has a long way to go. Most of the units fall into the above mentioned group of condos with little or no actual sea view and are quite a long walk to the beach.

Especially frightening is the creative means they plan to pay for ongoing maintenance. Rather than charge a monthly assessment, the condo purchaser pays a 'one-time' fee up front which, in theory, gets invested and funds the maintenance and upkeep. I'm sure their model was based on a certain level of investment rates, but with current and near future rates being so low, the model could break down. Also, if they don't reach a critical level of sold units, the project may not have sufficient funds for this concept. Hopefully, they have really sold 70% of the units and will avoid serious problems.
So on the basis of this info the developers are building condo units without any particular thought about their potentiall market? IE with no sea views and a fair walk away from the beach. Not exactly aiming at the farang market then. Which brings us back to the actual buyers - mainly Thais buying as second homes.
Which is fair enough really given the influx of Bangkok Thais every weekend to HH. If they have a spare couple of mill they may as well have a small pad there. Unlike farang they probably aren't too bothered about sea views - it's the status of having a second home in HH that is important.
Longer term though the state of the buildings should be a concern. With unrealistic fixed service charges there is bound to be a deterioration in the properties over time. To a farang that would be unacceptable. But we can't judge by our own standards, and the fact is that in the here and now Thai buyers enjoy the status of living in HH. What happens in the future will take care of itself.
A sprout is for life - not just for Christmas.
User avatar
Ratsima
Ace
Ace
Posts: 1141
Joined: Tue Apr 23, 2013 6:53 am
Location: โคราช

Re: Hua Hin weighed down by oversupply of condos and houses

Post by Ratsima »

IMHO The Energy has all the makings of a colossal slum.
User avatar
Big Boy
Moderator
Moderator
Posts: 44954
Joined: Fri Nov 04, 2005 7:36 pm
Location: Bon Kai

Re: Hua Hin weighed down by oversupply of condos and houses

Post by Big Boy »

Ratsima wrote:IMHO The Energy has all the makings of a colossal slum.
That could be an improvement :run:

Seriously, I find it very unattractive. I often wonder about the wisdom of building a 6* hotel at the edge.
Championship Plymouth Argyle 0 - 1 Preston NE :cry: :cry: :cry: :cry:

Points 41; Position 18
User avatar
Ratsima
Ace
Ace
Posts: 1141
Joined: Tue Apr 23, 2013 6:53 am
Location: โคราช

Re: Hua Hin weighed down by oversupply of condos and houses

Post by Ratsima »

I think there will be a lot of buyer's remorse as owners come to realize that it's not much of a vacation spot and that maintenance is poor. They will attempt to recoup their investment by making long term rentals to low income tenants who don't much care what the place looks like.

I really wonder if that "six star" hotel will ever get off the ground.
lomuamart
Moderator
Moderator
Posts: 9731
Joined: Tue Dec 31, 2002 12:25 pm
Location: hua hin

Re: Hua Hin weighed down by oversupply of condos and houses

Post by lomuamart »

It reminds me of some of the Soviet housing schemes that I saw in Russia in the mid 1970s.
User avatar
StevePIraq
Rock Star
Rock Star
Posts: 3043
Joined: Sat Jun 28, 2008 1:21 pm
Location: Ting Tong Land

Re: Hua Hin weighed down by oversupply of condos and houses

Post by StevePIraq »

Re bulk buying of condo's, I know a very successful Thai business man who actually lives in the UK 90% of the year. He recently purchased 22 condo's in a new development here and received a whopping 41% discount of normal retail price. He advised the developer is struggling to sell and hence running into problems with his financing. The purchaser knows very well he will not sell in the near future but he can claim substantial tax benefits in Thailand on top of the huge discount he got. He also obtained very beneficial payment terms none of us are likely to get when purchasing one unit.
"Live everyday as if it were your last because someday you're going to be right." Muhammad Ali
User avatar
buksida
Moderator
Moderator
Posts: 22477
Joined: Tue Dec 31, 2002 12:25 pm
Location: south of sanity

Re: Hua Hin weighed down by oversupply of condos and houses

Post by buksida »

Hua Hin condo market booms

Condominium demand in Hua Hin and Cha-am continues to soar, outpacing growth seen elsewhere in the country, says consultancy Plus Property Co.

Managing director Poomipak Julmanichoti forecasts first-quarter condo sales figures in the neighbouring districts will show healthy growth following a string of new development announcements last month.

These include L.P.N. Development Plc's new project in Cha-am, which has already reached a high take-up rate of 70%.

Meanwhile, Plus Property set a new record with 600 million baht in sales of completed Hua Hin/Cha-am condo units from Sansiri Plc in the two-day "Joy of Hua Hin in Bangkok" event held recently at Siam Paragon.

"These sales figures indicate especially high demand growth in the Cha-am and Hua Hin condominium market compared with other regions even as major cities nationwide continue to face an oversupply," Mr Poomipak said.

http://www.bangkokpost.com/business/new ... rket-booms
Who is the happier man, he who has braved the storm of life and lived or he who has stayed securely on shore and merely existed? - Hunter S Thompson
User avatar
Ratsima
Ace
Ace
Posts: 1141
Joined: Tue Apr 23, 2013 6:53 am
Location: โคราช

Re: Hua Hin weighed down by oversupply of condos and houses

Post by Ratsima »

Over supply or excess demand? How things change in only six months....
User avatar
buksida
Moderator
Moderator
Posts: 22477
Joined: Tue Dec 31, 2002 12:25 pm
Location: south of sanity

Re: Hua Hin weighed down by oversupply of condos and houses

Post by buksida »

I have a feeling that article is just a load of promo for the company, more of an advertorial I guess!
Who is the happier man, he who has braved the storm of life and lived or he who has stayed securely on shore and merely existed? - Hunter S Thompson
User avatar
buksida
Moderator
Moderator
Posts: 22477
Joined: Tue Dec 31, 2002 12:25 pm
Location: south of sanity

Re: Hua Hin weighed down by oversupply of condos and houses

Post by buksida »

Hua Hin wrestles with oversupply of condo projects
A 20km stretch of Petchakasem Road, from Hua Hin district to Khao Tao, has 30 condominium projects offering a combined 14,817 units worth more than Bt80 billion currently under construction and open to booking, according to a survey by The Nation early this week.
Most of the projects have seen sales of between 30 per cent and 50 per cent of total units, while the rest are in the presale process.

"The season for sales of residential units in Hua Hin is only three months a year - between March and May - as a result condominium projects for sale in Hua Hin will take a year to a year and half before they are sold out," Property Perfect Plc's chief business development officer Wongsakorn Prasitvipat said. The company has launched its first condominium project, Bella Costa, in Hua Hin worth Bt1.67 billion.

The project has recorded presales worth Bt350 million of total project value. About 90 per cent of customers are locals and the balance 10 per cent are foreign buyers both from Asia and Europe.

Full Story: http://www.nationmultimedia.com/busines ... 57776.html
Who is the happier man, he who has braved the storm of life and lived or he who has stayed securely on shore and merely existed? - Hunter S Thompson
User avatar
STEVE G
Hero
Hero
Posts: 12798
Joined: Mon Apr 03, 2006 3:50 am
Location: HUA HIN/EUROPE

Re: Hua Hin weighed down by oversupply of condos and houses

Post by STEVE G »

buksida wrote:

"The season for sales of residential units in Hua Hin is only three months a year - between March and May - as a result condominium projects for sale in Hua Hin will take a year to a year and half before they are sold out,"

Full Story: http://www.nationmultimedia.com/busines ... 57776.html


I'm a bit curious about why people only buy condos between March and May if 90% of buyers are Thais.
Pleng
Legend
Legend
Posts: 2798
Joined: Fri Apr 08, 2011 2:04 am
Location: Hua Hin

Re: Hua Hin weighed down by oversupply of condos and houses

Post by Pleng »

I guess Thais also tend to holiday less when it rains.
User avatar
STEVE G
Hero
Hero
Posts: 12798
Joined: Mon Apr 03, 2006 3:50 am
Location: HUA HIN/EUROPE

Re: Hua Hin weighed down by oversupply of condos and houses

Post by STEVE G »

Pleng wrote:I guess Thais also tend to holiday less when it rains.
When they have a holiday, they throw water at each other anyway!
User avatar
Bristolian
Deceased
Deceased
Posts: 3128
Joined: Fri Nov 09, 2012 1:38 pm
Location: Hua Hin & Bangkok

Re: Hua Hin weighed down by oversupply of condos and houses

Post by Bristolian »

A lot Thais, working for major companies, receive annual bonuses at the end of the fiscal year and these bonuses are often 3-4 months salary, depending usually on how well the individual company has performed. There tends to be a sending spike around this period for large purchases, cars, motorbikes etc. These bonuses may also provide the incentive to purchase a new home.

You also find that workers wanting to change jobs will wait until immediately after their annual bonuses are paid
"'The two most important days in your life are the day you are born and the day you find out why." - Mark Twain
Post Reply