Pricing Trends - Mid-priced Rentals
I have been listing my house in Patong for sale for quite a
while now. I understand that the property market has been improving,
but am concerned that my property remains unsold. Do you feel that I
should change my asking price?
The residential housing market in Phuket can be broadly broken down into two basic groups. The first is the general residential category which are typically built on level land, often on big subdivisions, and are mainly located on the longer developed east side of this island. They may be small or large, simple or fancy, but in general they are similar and numerous enough to be able to make reasonably accurate comparisons and valuations.
The second category, which I shall refer to as resort residential, are typically on hillside or waterfront sites, tend to be individually built properties or small subdivisions, and are mainly located on the more recently developed West coast of the island. While generally of higher standards of construction and finish, these resort residential properties can be best categorized by their relatively small numbers and unique locations. So making comparisons and valuations becomes much more of an art than a science.
Your house falls into this latter resort residential category. It is a small, relatively illiquid section of the market and the least elastic to price. For people looking for a house in this category, price is rarely the most significant criterion. The all important (and hardest to define) criterion is location. People, as much as the properties in this group, are individuals, and matching an individual buyer to an individual property may take some time, but at the end of the day it is the location (and its improvements) that will sell your property, not a bargain basement price.
My advice, leave your price unchanged, or if the market improvements (at the moment they are mainly in volume) that you have perceived, continue (and I think they will) I believe that you should even consider increasing your price if you are still unsold in a few months time.
I work for an oil company and am being transferred to work (on rotation) out of Songkhla. My contract will run for 1-2 years and my company prefers my wife and children come to live in Thailand My wife will live in the property all year, often while I am at work, so security is a matter of concern to me. Proximity to the beach would be a plus, but I dont know if our housing allowance (25,000 Baht per month) would cover it.
As with the gentleman last month asking about executive beach homes, I can only emphasize that secure quality rental homes at moderate prices and reasonable proximity to a beach are limited in supply and hard to find.
Two bedroom apartments in one of the better (walk to the beach) condominium developments are going to cost 35,000 Baht and upwards (particularly, as is often the case, daily services are included). A quality two bedroom house, in a secure spacious compound with reasonable proximity to the beach will have similar a price.
Driving a mile or so from the beach (or in particular crossing over to the east side of the island) will typically open up a much wider range of choices. Very simple one/two bedroomed homes may be found in the 5-10,000 Baht price, but for something that may begin to match Western standards expect to pay 15-20,000 for a home on one of the newer housing estates (general residential category). While typically fairly secure and with the comfort of neighbors, properties in the type are likely to be categorized by small plots (under 400 Sq.m.) and a corresponding lack of privacy and in many cases green areas.
Working with your budget, you may not fully match all your expectations, but if you weigh up the relative importance of beach proximity, price, privacy and security and make some adjustments where appropriate to local lifestyles and conditions, I think you will find that you can get pretty close.