Tough times ahead for developers

I did not elaborate much on the flood as I am not an irrigation expert and from all the news I have been hearing, I am in no position to specifically point a finger at anyone, blaming them for what has happened to Thailand. 

However, from architect’s point of view, I can guess what will happen to real-estate development in Thailand in the near future. 

As soon as the flood started to show its intensity, I started hearing people talking about traditional Thai houses, those built on stilts. I must admit I had a big grin on my face when I heard it. What a wake-up call for us all to revisit traditional Thai architecture, which has been designed to suit the tropical environment. We shall see more houses on stilts or raised floor in years to come. 

At the same time, real-estate developments with “canal” or “lake” themes maybe at risk as people are now scared of water. The first thing people will check before buying any new properties now will be the ground level and flood history. 

Land prices will also change dramatically. Any areas that remained dry should see an increase in land value by 50 per cent or more, while areas that were severely flooded will lose their value. Land in inner Bangkok, which is already expensive, will become even more expensive. People who can afford to buy new property will be looking at inner-city condominiums first. If they cannot afford a property in central Bangkok, second and third choices will be properties along BTS routes where the lands are always dry. 

Some people will be looking for a second home or condominium somewhere dry, and near Bangkok as well. Hua Hin and Pattaya will remain top choices. However, Pattaya may receive better rating due to its closer distance to Bangkok and better accessibility if more severe flooding occurs. 

Architects, engineers, interior designers and contractors should see a lot of renovation work, which will last 4-6 months.  However, experts had predicted even before the floods that the real-estate market will face a tough time due to oversupply. Now, as people have to spend a lot of their savings on fixing things, there won’t be much money left for even New Year’s shopping. Therefore, developers will have to plan their strategy carefully as there is no sign that the economy will pick up anytime soon and people will buy only if the overall economy is good.  That tough time may happen much sooner than expected. 

Finally, as this is my last article in 2011, I wish you all a wonderful thanksgiving, merry Christmas and a happy New Year. Thank you for following this article and whatever will happen to Thailand, we will get through it together, as always. 

 

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