Global and domestic crises are worsening and moving
through the first quarter of 2009 the market outlook forecasts an
extremely challenging property market in Samui and other key resort
areas in Thailand, according to C9 Hotelworks latest Samui Luxury Villa
"The evolving tourism sectors and broadening
access to Samui introduce a new set of potential investors to the
islands real estate market, and with changes to how the island is
governed it may well alleviate concerns about necessary
infrastructure development and other local issues," said Bill
Barnett, Managing Director of C9 Hotelworks.
still suffering from the recent political events and a national
agenda which focused more on domestic affairs whilst other
regional economies were gearing up to address the impact of a
global downturn. As a positive - for some markets - the Thai baht depreciated
approximately 15% over the past 12 months versus some major currencies
and is forecasted to devalue another 5% in 2009, thus creating
lower acquisition prices for certain offshore buyers.
luxury property market is operating at a severe handicap versus
more developed markets, due to the fact that in a segment
dominated by overseas investors there have been no significant
government stimulus packages or reforms addressing foreign
ownership of land and availability of mortgages to foreigners.
Bill Barnett added, "With the increase of luxury branded
developments entering the market, Samui's reputation as a luxury
destination has been cemented. However, with the capital markets
crunched and available debt declining, the development pipeline
looks to remain static into 2010; which long term will swing
supply demand into a more favorable ratio, but short term will put
existing retail pricing at risk."
The Samui luxury
property segment, however, continues to see transactions even
though at reduced levels with buyers minimising development risk
by preferring existing product to off plan units. As the economic
crises continues to deepen the gap between expectations on price
are becoming more evident, though property values are holding due
to limited leveraging by investors.
Challenging times lie
ahead for investors, developers and the government as
infrastructure and development will need to grow in parallel to
secure Samui's position on the luxury resort destination map.
other recent news regarding: