Building on strengths

New projects to add sparkle to the real estate markets in popular seaside resort, reported Nina Suebsukcharoen in Hua Hin

The real estate market in the popular seaside resort of Hua Hin to build on its strengths in this year with new developments and to boost the ongoing projects to attract strong interest. Purchase and development of holiday clubs are also things of life.

Praphaisith Tankeyura, managing director of the 80-rai villa and condominium development boat house Hua Hin, said the market expected with the introduction of some new properties, including the Moroccan Marrakech motto of Major development; Baan San Suk, is located at the entrance of Khao Trakiab and developed by Sanrisi and the relaunch of Malibu Khao Tao of Maneeya Realty Co.

''The average sales price for floor property in Hua Hin is more than 100000 baht a square metre now with the introduction of Marrakesh and Baan San Suk,''Mr Praphaisith said recently at a fair Songkran during the six units boat house were auctioned.

''All are on the beach, but they are low-rise buildings, notably four to six floors. Our price is very cheap compared to them. And this despite the fact that we have invested more than half a billion baht in our infrastructure, swimming pools and gardens.''

This is not an empty boast, because visitors will clearly see the evidence with two of the four condominium towers completed and the construction of the third underway. Perhaps the reason why Laguna Holiday Club, part of the Laguna Resort in Phuket, decided the purchase of 55 units in the boat house Hua Hin for around 300 million baht to serve their time-share members, bringing the total number of about 5000 people, which 65% are Thai.

Mr Praphaisith said several foreign pension funds were also used in Thai with a country from the U.S. to develop a low-rise condominium near the Hua Hin railway station. The goal is to American members of rotation, but it is uncertain whether the fund actually called a holiday club.

''This is something new, good for Hua Hin, good for Thai country.''

Phanom Kanjanathiemthao, managing director of Knight Frank Thai land, property and rental management form for boat house Hua Hin, said that although the time-share companies had a bad reputation in the past, things have changed in the U.S. and Europe, where regulations have improved the industry.

Such arrangements are rare in Asia and Mr Phanom urged the Thai government to adopt new rules, because the time-share companies had expanded to fractional ownership, in which a property or villa is collectively owned by several persons.

''In Europe and America have the support of these laws, and we should too. It would mean the sale of an entire building at 500 to 700 people instead of 90, and anybody could the device for 30-40 days a year, or if they do not use it, they could offer it for rent.''

Mr Praphaisith, former president of Bank of Ayudhya, admits that floor property easier to sell than higher-villas, but he has a few marketing strategies in mind. He plans to visit New York later this month to around 100000 Thais living in the city and four neighbouring states, because for them the 15-million-baht price tag is not so high.

''We have already sold five units to Thais in the States. Hua Hin is a romantic place for Thais, a magic word, the royal summer is the place. ... It is a place for your family to enjoy and live _ not like Pattaya.''

While things are exclusively for Hua Hin, Mr Praphaisith pointed out that the banks tightened their lending to developers and only the strongest players are able to cope. ''At the moment banks require presales of 40-50%, before offering them a construction loan, so that the banks are very conservative.''

He said some projects have not yet reached the 40-50% level presale, and agreed that the banks must be cautious to the point that the developers have their own equity on the implementation of a project forward.

''This is the risk, I think buyers really need to know how developers are committed.''

This change certainly advantages of second-hand market, but Mr Praphaisith noted that only units in buildings have cultivated good value.

While some people are a little uneasy about the direction of Thai politics, Mr Praphaisith think Thai people take such changes in step. ''Governments come and go in Thai country. ... It is about the economy. We were close to the bottom after so many years there is not much room left to sink any further, but it is an opportunity for us to rise to the increase of rice prices _ rice is as crude oil today.''