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Thread: Thailand boom sustainable

  1. #1
    Senior Member marc26's Avatar
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    Thailand boom sustainable

    Thailand's boom is sustainable, unlike the one in 1997 | South China Morning Post

    all the Asian indexes are off near 25% in the last few months



    on the small personal side, you do see the effects
    my wife is never asked for money from her siblings through her mom any more. they make enough to get by and be somewhat comfortable
    the sister is looking to buy a house
    her boss here in Vancouver, certainly upper middle class in Thailand, just got back and was amazed how things were booming

    downside, if you want to call it that, my wife said she has to increase what she sends to her mom every month. which i totally agree with, things are much more expensive these days and no way her MIL can get by with 15k/mo for her and the son, especially with his expenses( school, now being 12yrs old and being more social)

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    Super Moderator LivinLOS's Avatar
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    I have no idea if its sustainable any more.. It appeared entirely credit funded with everyone so deep into debt v the amounts they make it blows my mind, but that said the pace of change here in Chiang Mai is just jaw dropping.

    I have been here not even 3 years, the house I live in was 10k from the outside of the city, now its about 5k. All the roads this side of the city are being made from 2 lane to 4 lane, and every field and rice paddy between my house and the city is being turned into housing estates. We are talking 1000's maybe 3000 - 5000 new homes, just on one road alone, being built in the last 18 months. Then factor in every other rd out on the east side of the city is doing the same and your talking a housing inventory of 10's of 1000s of new units.. Where are all these people going to come from ?? On my moobaan at night only maybe 30% of the homes are occupied. Everyone buys them as investments but selling one of these type of estate homes proves to be near impossible.

    The road to me has added 4x 7/11s one tesco lotus express and 2 large thai style wet markets, is there really that many more people ?? Or that much more that can be sold ?? Also 2 new large western type malls, one just a couple of ks from me and another being the new central world, which will be Thailands second largest shopping mall.

    It is undeniable with the pace of change, that there is a boom happening. Yet I struggle to see what is driving it, or what can sustain it. Is it all just global hot money or is domestic activity really picking up enough to carry it ?? The country appears to be in no better shape as a global player than it was in say 04, and in many ways wage cost increases are making it less competitive for manufacturing, but theres no argueing that its modernizing at a pace.

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    Senior Member kaptainrob's Avatar
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    ^ Development out your way is rampant Sef.

    I couldn't believe the number of moobans and new homes being created out of rice paddy but upon investigation most properties are being snapped up by Bangkok (and other Southern & Central province) buyers. A modest 3 bed house is ~ 3.5mBt, cheapies are closer to 2mBt, and buyers aren't too bothered about having them sit empty as they're too far out to lease easily.

    Buying land from KTB recently and the Manager told us he's never been busier and the momentum is still growing with (distressed) property barely hitting the market. Our Amphur Office has a daily queue system akin to immigration ... 555

    Most of this rush to buy in CNX is due to a fear of 2011-type floods, reports of BKK sinking Venice-like, plus other global warming fears. Southern province rubber/palm oil farmers are buying here to (one-day) escape the trouble in their region as well as floods.
    Cheers, Rob.

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    Senior Member marc26's Avatar
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    Quote Originally Posted by LivinLOS View Post
    I have no idea if its sustainable any more.. It appeared entirely credit funded with everyone so deep into debt v the amounts they make it blows my mind, but that said the pace of change here in Chiang Mai is just jaw dropping.

    I have been here not even 3 years, the house I live in was 10k from the outside of the city, now its about 5k. All the roads this side of the city are being made from 2 lane to 4 lane, and every field and rice paddy between my house and the city is being turned into housing estates. We are talking 1000's maybe 3000 - 5000 new homes, just on one road alone, being built in the last 18 months. Then factor in every other rd out on the east side of the city is doing the same and your talking a housing inventory of 10's of 1000s of new units.. Where are all these people going to come from ?? On my moobaan at night only maybe 30% of the homes are occupied. Everyone buys them as investments but selling one of these type of estate homes proves to be near impossible.

    .
    foreign money(even if you just count rich BKK money) just seems to drive these booms
    at night if you look at the Sahngri-La or the new Georgia Residences, i would say 10-15% of them have lights on and occupied and since i have lived in Vancouver, there has to be 30 high rise apartment buildings built and yet, there is at least 8 being built within 5 blocks of me still
    i mean sometimes i think about leaving because the whole frigging place is a building site

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    Things have been crazy since Soi 6 went to 700 bht...
    kris-one likes this.

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    Senior Member Geespot's Avatar
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    Lenders unruffled over level of household debt - The Nation

    Household debt rising: 40% of income | Bangkok Post: learning

    Crazy stuff and they think the bubble wont burst

    Looks like its going the same way as US & UK on the personal debt front
    Last edited by Geespot; 15th July 2013 at 16:13.

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    Senior Member kaptainrob's Avatar
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    Quote Originally Posted by Geespot View Post
    Lenders unruffled over level of household debt - The Nation

    Household debt rising: 40% of income | Bangkok Post: learning

    Crazy stuff and they think the bubble wont burst

    Looks like its going the same way as US & UK on the personal debt front
    Possibly the worst aspect, the long-term damage it will cause to Thai families as when the sh*t hits the fan, rich Uncles and Aunts will have to bail out the family ... that's if they haven't already been 'touched' for deposit on car or house.
    Cheers, Rob.

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    Senior Member Dodger's Avatar
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    Is rich Aunties and Uncles a new term for the word 'Aussies'???
    Dupree, Tarzan and Dkdude like this.
    Custard should be a colour...cos I could then paint over the mess I've just made!!!

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    Anyone care to speculate what will happen if, or rather when, the bubble burst? I am thinking about the environment for tourists/expats, prices, and the exchange rate.

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    Senior Member kaptainrob's Avatar
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    Quote Originally Posted by Dodger View Post
    Is rich Aunties and Uncles a new term for the word 'Aussies'???
    Why is your head is always in the gutter, Bernie?
    Cheers, Rob.

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    News article today saying that Rice is being run in from Myanmar and Cambodia in big quantities as Thai Government tries to sustain artificially high local rice prices for local producers as huge stockpiles of overpriced rice build up in Thailand....??
    Say it ain't so......

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    Quote Originally Posted by kaptainrob View Post
    Possibly the worst aspect, the long-term damage it will cause to Thai families as when the sh*t hits the fan, rich Uncles and Aunts will have to bail out the family ... that's if they haven't already been 'touched' for deposit on car or house.
    It ain't the deposit I'm worried about, it's the five to twenty years of actual repayments...

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    Senior Member kaptainrob's Avatar
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    Quote Originally Posted by Changone View Post
    News article today saying that Rice is being run in from Myanmar and Cambodia in big quantities as Thai Government tries to sustain artificially high local rice prices for local producers as huge stockpiles of overpriced rice build up in Thailand....??
    Say it ain't so......
    Been happening for ~2 years already. Geez, Thaksin gotta get his Bt's back somehow ....
    Cheers, Rob.

  14. #14
    Senior Member soupdragon's Avatar
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    Quote Originally Posted by kaptainrob View Post
    Been happening for ~2 years already. Geez, Thaksin gotta get his Bt's back somehow ....
    Well technically it wasn't his baht, but yes, a colossal number of bahts have and continue to disappear into this black hole.

  15. #15
    Senior Member dontpanic's Avatar
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    As a lot of my fellow country men and women have found out to their cost, there is no soft landing for booms, especially credit led ones which a lot are and given the Thai don't worry about tomorrow attitude I think this bubble will burst quite badly. Hey maybe no bad thing for falangs, maybe we can get 50 baht to the euro again! If I had money to invest it would be in Cambodia, I got a real vibe of they're on the verge of something big while I was there and have been recording impressive growth figures for a few years now.

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    Anyone expect the banks to say they are worried and there is a problem ... no matter how bad things get?

    Once these things are "officially denied" like this you can be sure a crash is imminent as these statements are actually damage control measures to try and calm the market and minimize the upcoming damage and loss of confidence etc.

    These headlines tell me I won't get getting less than 30 baht to the $A for long

    Enjoy...

  17. #17
    Senior Member marc26's Avatar
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    Quote Originally Posted by dontpanic View Post
    As a lot of my fellow country men and women have found out to their cost, there is no soft landing for booms, especially credit led ones which a lot are and given the Thai don't worry about tomorrow attitude I think this bubble will burst quite badly. Hey maybe no bad thing for falangs, maybe we can get 50 baht to the euro again! If I had money to invest it would be in Cambodia, I got a real vibe of they're on the verge of something big while I was there and have been recording impressive growth figures for a few years now.
    The poor thais that most of us know "don't worry about tomorrow", just as most poor in any country

    but middle class and upper class thais are just like anyone else with their finances

  18. #18
    Super Moderator LivinLOS's Avatar
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    Quote Originally Posted by marc26 View Post
    but middle class and upper class thais are just like anyone else with their finances
    I dont know about that.. I have never seen a place where buying a merc or BMW to show, but eating noodles at home because you cant afford food, was more prevalent.

  19. #19
    Senior Member Geespot's Avatar
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    Quote Originally Posted by LivinLOS View Post
    I dont know about that.. I have never seen a place where buying a merc or BMW to show, but eating noodles at home because you cant afford food, was more prevalent.
    Spot on...........really the % of population with money in Thailand is tiny. Average salaries at somewhere between 15k-30k a month, who can afford a loan on a car around say 700k and a house anything from 1m to 5m in BKK? It's exactly like the reports say, your middle class families making monthly payments which are a huge proportion of their monthly income. Just as it is in the west!!!!

  20. #20
    Senior Member marc26's Avatar
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    Quote Originally Posted by LivinLOS View Post
    I dont know about that.. I have never seen a place where buying a merc or BMW to show, but eating noodles at home because you cant afford food, was more prevalent.
    you live there so would see it more, but the people i know outside of the poor demographic are not any different than people form the west
    if anything, they are a bit more sensible financially

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