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When There Is Blood In The Streets, Buy Property

The old adage has been around since the 18th century, when Baron Rothschild was quoted as saying "Buy when there's blood in the streets, even if the blood is your own." The British nobleman was a member of the infamous Rothschild clan that made it's name in banking. Rothschild made a fortune buying up properties during a fire sale that resulted due to panic after the Battle of Waterloo against Napoleon. Over the years the same principle has been proven time and time again in the wake of histories darkest moments.

There couldn't be a better time to invest in property in a place like Pattaya

Despite the tragedy and hardship that was felt by your average citizen during the Great Depression in The United States in the 1930s, More millionaires were made in those years than at any other time in history. Joseph Kennedy, the father of former American president John F. Kennedy built his empire and gained fortune by investing heavily in real estate during the Depression. Kennedy increased his net worth from 4 million USD to over 180 million USD between 1929-1935.

In recent years this pattern has held true in the aftermath of events such as world wars, natural disasters and financial meltdowns that have rocked the markets and caused buyers to panic. Fortunes have been made in Europe at the end of World War 2, in Asia in the aftermath of the 1997 Asian financial crisis, and in countless other times of desperation and despair. It would seem that when things appear to be hopeless, this is no time to panic, and perhaps the most opportune time to invest.

The island resort area of Phuket was devastated by the 2004 South Asian Tsunami, an entire season of tourism was canceled, and local merchants were left penniless, many losing their entire net worth. The lives of nearly 500 people were unfortunately lost in this tragedy, and the local economy came to a grinding hault. The price of property at this time never actually fell, however it stalled for long enough for a few people to make a significant fortune, and today real estate on the island of Phuket has now nearly doubled in value since the Tsunami.

In Thailand in recent years, there literally has been "blood in the streets", as the saying goes. The political turmoil last year during the red-shirt protest resulted in several unfortunate deaths in the capital of Bangkok, as well as significant property damage in the center of the city. Time has passed and now many of those wounds have since healed, with a new government and a much more stable political climate, the future looks quite promising.

The serious floods that are now causing havoc across the country will no doubt have a negative impact on the country's economy, the Bank of Thailand has already announced that they will need to revise the economic forecast and they expect significant downgrades due to the flooding. The cost of damages caused by the floods are estimated to exceed 100 billion baht which is equal to 1% of gross domestic product. While this is certainly far from good news, don't expect this to have a negative impact on the value of real estate in the country, the popular resort areas of Pattaya, Phuket, and the islands in the south have not been affected by flooding.

There couldn't be a better time to invest in property in a place like Pattaya, where the cost is relatively much lower than many of the other resort destinations that are popular with foreign tourists. The price of property in Phuket, Krabi and the nearby southern islands is only going up, with increasing demand showing no signs of slowing. Thailand's property market is as strong as it has ever been, and while there is a natural disaster playing out in some parts of the country, the same Rothschild wisdom shall likely prevail "When there is a flood in the streets, buy property."

Why More People Are Choosing Pattaya Over Phuket

The Island of Phuket in Southern Thailand has been growing in popularity in recent years, with a significant increase in annual tourist arrivals. This is welcome news to hoteliers and real estate developers, however local expats find themselves struggling to manage with the growing cost of living. Many long time residents have been looking at making a move to Pattaya, where the cost of food and accommodation is much lower. While the cost of rental property, hotels, bars and restaurants has almost doubled over the last decade in Phuket, it remains affordable in Pattaya. 

Pattaya is growing in popularity

Both of these popular resort destinations are well known for their world renowned nightlife, and depending on who you talk to, some might say that one is better than the other. One thing that nobody will dispute is that the average cost of a night out on Walking Street will be more affordable than a night out on Bangla Road. Nightlife is one of the foremost attractions that lure foreign tourists to Thailand, so it is no surprise that Pattaya is growing in popularity due to a rise in the cost of entertainment in Phuket. 

Phuket is famous for having some of the world's best beaches, however more tourists are finding it challenging to find a spot of unoccupied sand on any of the main beach resorts on the island. The local beach boys might be able to offer a plastic chair and an umbrella, however it will cost you 100THB. Pattaya has long been a popular place for Bangkokians to enjoy a weekend at the beach, and tourists are finding that Jomtien Beach is less crowded and every bit as enjoyable as any of Phuket's beaches. Popular activities such as para-sailing, water skiing, kite-surfing and windsurfing top the list of things to do at the beach in Jomtien. 

The lack of affordable public transportation has plagued Phuket for years, and several recent high profile incidents of violence involving tourists and tuk tuk drivers have many people calling for the government to make changes. One of the common suggestions is that government officials should look at implementing something similar to what is currently in use in Pattaya. The preferred method of getting around in Pattaya is a system of baht buses, simple pickup trucks with rows of benches in the back. The cost of riding a baht bus is minimal, nothing in comparison to the fares charged by tuk tuks in Phuket. 

An efficient public transportation system combined with a more affordable cost of living is luring many long time residents away from Phuket, making the move to Pattaya. Many tourists are also taking notice, with Pattaya now more attractive than ever. With more people looking to make the move, the property market is expected to experience a significant growth in sales, with the price of condominiums expected to be on the rise in the coming year. The word on the street is that "Pattaya is the place to be, with top value for your dollar, it is one of the most attractive destinations in Southeast Asia". 

The Property Market in Thailand

Thailand's Property Market Is Poised To Remain Strong Despite Global Economic Concerns 

Talk of an uncertain future for the world economy is everywhere these days, If you watch the evening news or read the Sunday paper, you will hear terms such as "double dip recession", "austerity measures" and "euro-zone debt crisis". With all the negative reports floating around, a positive forecast regarding Thailand's economic future is welcome news for investors and real estate developers. Despite struggling economies in Europe and North America, the future remains bright for Asia. 

property in Thailand remains a solid investment for foreign investors

While investors appear to be pulling out of Europe, they may be looking at Asia as a more attractive place to bank on in the future. Leading the way are India and China, with the world's fastest growing economies, Thailand looks to benefit from it's geographical location between these emerging economic giants. The Thai economy has shown resiliency despite a rocky road in recent years, holding strong through challenging hurdles such as an unstable political climate, a global economic crisis in 2008, and a devastating natural disaster with the Tsunami in 2004.

Experts agree that if Thailand can sustain a stable political climate, the sky is the limit for economic growth. Following the recent election, consumer confidence is at an all time high, as the new government is expected to bring stability after years of political turmoil. Investors showed confidence in the newly elected government as the Thai stock market surged by 5% on the first day of trading after the election. The earthquake in Japan as well as flooding in Northern Thailand has prompted the Asia Development Bank to slightly downgrade a positive forecast for 2012, however a growth of 4.5% in GDP is still expected. 

A healthy economy, a rise in construction costs and increase in mortgage lending has resulted in an increase in the cost of housing in Thailand. According to The Bank Of Thailand, the cost of residential land has gone up by 13.4% since 2009. As demand for residential property increases, the rental market for condominiums and townhouses is growing rapidly. An increase in the number of annual tourists visiting Thailand will only strengthen the demand for rental units in places like Phuket, Pattaya and Bangkok. Thailand remains attractive to retirees and expats from around the world, with a relatively low cost of living and a warm climate year round, it is difficult to compete with what Thailand has to offer. With more foreign expats retiring from their posts around Asia, in places like Singapore, Hong Kong, Tokyo and other major business hubs, Thailand looks like an attractive place for these people to hang their hat. 

Leading the way are the beach resort areas such as Phuket and Pattaya, with world class golf courses, legendary nightlife and some of the world's best beaches, it is no wonder so many people choose to settle down in Thailand. While the cost of property in Thailand has skyrocketed over the past decade, it remains relatively affordable compared to Europe and The United States. Property value in Thailand looks to be on the rise in the future, as growing demand shows no signs of slowing. Despite global economic uncertainty, property in Thailand remains a solid investment for foreign investors.