When There Is Blood In The Streets, Buy Property - Green Door Enterprises

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[Published on 2011-10-17 in Property Newsby Jesse Schule]

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."


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