At a time of uncertainty, fortune certainly favours the brave. Perhaps the correlation between acquired wealth and calculated risk is no better illustrated than in Phuket�s present property market. At a time when one might consider that the present government attitude towards the acquisition of land by foreigners would deter potential buyers of villas with land or indeed land itself, it appears to be having quite the opposite effect on the top-end market.
Despite the negative news from the temporary administration � or perhaps because of it � the interest in high-end developments appears to be growing. Take two of the most prestigious developments on the island, Andara and Cape Yamu, both multi-million dollar villa projects and, at the time of writing, both almost sold out. We are receiving more enquiries for bigger top location plots than ever before, both from foreign investors and wealthy Thais alike. I believe the reason for this is because in a time of uncertainty those who can afford to take the risk inevitably stand to gain the most. Not that land prices are tumbling, simply because there is an increased willingness for the sellers to accept offers that they might have resisted before for absolute prime lots.
I think there is also a strong belief that once there is a democratically elected government in power, prices will increase considerably. These buyers are not, of course, likely to be spending their last buck. They appreciate there is a profit to be made in the property market, as in any market, when there is bad news.
The market up to nine million baht is doing quite nicely partly because it's often being bought up by wealthy investors building upon their portfolio, and by people who desperately want to own a property here and have the ready cash available. A good friend of mine currently owns about 200 cheaper properties in Thailand and is buying now more than ever. He is finding he can go into a development now in its early stages and make an offer to buy several units and the developer is negotiating a deal whereas before he might have stood firm.
Where we are finding the market has slowed however has been the middle range, 10 to 20 million baht, often where the purchase is being financed by a second mortgage of the house back home. These buyers are far less likely to buy in uncertainty. When the tide turns, as it most surely will, the buyers in this range come flooding back looking for the bargains when it�s too late. They will buy on the crest of the wave while the clever ones bought while the wave was just a ripple. Hence the wealthy become wealthier. As the great tycoon James Goldsmith once said: "when you can see the bandwagon, it�s too late to get on it".
If I was a tipster and property was a share I would be saying "buy". If you are still concerned, buy foreign freehold condominiums, it�s a no-brainer. But, mark my words; the big rewards will come to the land buyers.
