The functions of property have transformed radically over the last few decades and the basis on which people invest in property, or visit the island, has also radically changed.
Now important numbers include property comparables, common property fees, distances, heights and setbacks to name just a few examples.
When developers, real estate agents and private sellers present information on their properties, the way in which the information is presented must, in my opinion, be modernized to keep up with the times. Currently, many are using outdated techniques to communicate, and investors demand better.
THE ERA OF AIRBNB AND FAZWAZ
I thought of renting out my own property over the December high season while I take my family to Chiang Mai. I went through the process of listing my property on Airbnb and I realized that I am obviously not alone in my thinking. In fact, I am quite late. The mechanics and simplicity of use of these types of products is highly competitive compared to the bureaucratic and burdensome procedures that traditional renting methods can involve.
After going through the listing process, a ‘tips’ button appeared recommending the price I should advertise my property for. This price was way lower than the price I was informed by some real estate professionals that I could get, and lower than the price I think I can get. I will soon see.
However, the fact that a piece of software can analyze prices in the local vicinity and come up with a figure is impressive.
Similarly, a new program has been launched in Phuket called ‘Faz Waz’. This is designed to consolidate all information in Phuket on condominiums and produce a proper comparison tool for investors.
The engines for these tools are backed by substantive investment to make sure user experience is as friendly as possible. Everyone is familiar with the intuitive nature of Apple products although there are lots of people who prefer Windows / Android operating systems to iOS. However, both ‘camps’ now enjoy intuitiveness and there is a merger of what is important for a user.
WHICH NUMBERS ARE IMPORTANT?
In my humble opinion, the following criteria are important: internal space; external space; balcony space; garden and green space; swimming pool dimensions; price of property per square meter (building and land); price of land per square meter; price of building per square meter; distance to amenities and facilities in kilometers and in time; height of property; gradient of property; and distance and time to beach(es).
SIMPLIFIED PHUKET THEORY OF TIME
When investors look at property brochures and specifications, they will often see ’10 minutes to the airport’ and ’15 minutes to Kata Beach’. Really? Is that as ‘the crow flies,’ ‘as the private jet flies’ or if all of a sudden all cement trucks, very slow and safely driven mini-vans, green plate taxis and tour buses just disappeared.
We have to be truthful to investors. Phuket is congested, and will become more congested. This is because it has more people and more facilities and amenities.
MATH LESSONS FROM NEIGHBORING COUNTIRES
I rented a place in Hong Kong for three years to commute between there, Bangkok and Phuket. When I sought advice from my friends in Hong Kong, it was all about the numbers. Rental per square foot; how many minutes to the Mass Transit Railway (MTR); how many minutes to the Airport Express; and how many minutes to Welcome Supermarket.
Phuket is becoming more and more urban. I fail to remember a recent day when I have not seen or heard building activity of some sort. The math of Phuket will no longer be ‘partial sea view,’ meaning a 50 per cent price premium on a property. Admittedly, seaviews will, I think, always carry good values in Phuket. However, the math means that convenience shall play an increasingly important factor in the growth and type of investment in Phuket.
Desmond Hughes has been an owner and operator of his law firm in Thailand for 12 years, and is a Senior Partner at Hughes Krupica law firm http://www.hugheskrupica.com