There have been some very interesting stories circulating not only locally, but on an international level that could hopefully have a very positive impact on our lives here in Pattaya.
The first has been a hot topic here for as long as I can remember, so to be honest, when I first heard of its re-emergence, I was quite quick to dismiss it. However, this story has been circulating both in the Thai press as well as worldwide, so hopefully it actually has some merit this time around.
Pattaya officials want condo foreign ownership limits increased to 70% from 49%.
Now, for the uninitiated, the way it stands now, up to 49% of the total sellable area of a condominium building can be owned by foreigners, with the remaining 51% available only to Thai nationals or Thai entities, such as a Thai registered company.
What’s encouraging to me this time around is that for the first time, it seems that it is actually Thai officials who are pushing for this rather than foreigners who it would appear would benefit the most from this proposition.
Apparently this new push was born from the idea that it will help keep Thailand (and Pattaya, of course) more competitive once the Asean Economic Community (AEC) is formed in 2015. Apparently other Asian communities are chomping at the bit already and are themselves in preparation to ease laws regarding foreign property ownership and investment.
If you’ve never heard of the AEC before, you’re not alone. Googling AEC will get you nowhere (other than a multitude of other associations using the acronym AEC), but once I did find the official site (aseansec.org), it was actually quite an interesting read. The association seems to run the gamut from Free Trade to cooperation in finance, technology, energy, food, investment, tourism, and just about anything else you can think of.
Their mission statement reads as follows: The ASEAN Economic Community (AEC) shall be the goal of regional economic integration by 2015. AEC envisages the following key characteristics: (a) a single market and production base, (b) a highly competitive economic region, (c) a region of equitable economic development, and (d) a region fully integrated into the global economy.
One very interesting statistic on the site was the number of tourists arriving annually to the AEC’s Southeast Asian countries – from 20 million visitors in 1991 to 73 million in 2010. Just in the past 7 years it’s increased from 38 million tourists per year to 73 million.
Anyway, I digress. If this 70% foreign ownership comes to fruition, I can’t see it being anything but beneficial to the city. It will give owners of Thai or company owned units the opportunity to have them transferred into foreign title, thus making them more valuable and also more legitimate (if they’re in Thai company). The only real drawback being that it would be a bit costly with today’s inflated transfer fees. I can’t imagine how much commerce will flow through our local land registry if this actually happens.
But the main positive I believe this will bring is a sense that it’s easier to purchase property here. No longer will we be confined to a minority-designated amount of condos. I think the idea of company owned condos will mostly be a thing of the past. Even in the most foreigner-populated condos, you’ll probably find that less than 70% of the units are actually owned by foreigners or their designated Thai companies. Let’s not forget that Thai’s are still by far the biggest buyers.
Well, we can only hope. If it does come to light, it’ll have been a long time coming and big step in the right direction.
Along with this news comes another story that I’ve been hearing of and writing about for years now – the high speed rail line. Apparently, there are plans to run high-speed trains from Bangkok, through our fair city, into Rayong and back again. My only comment is – PLEASE! I cannot emphasize enough what a positive impact this would have on the long-term sustainability of the eastern seaboard. The amount of people and industry this would bring to the area would be astronomical.
Probably the most imminent of any news here is the beach expansion project for Pattaya Beach Road. I think the lack of real beach in Pattaya has always prevented it from really becoming the ‘beach town’ it very well could be, so I’m cautiously optimistic on this one. From what I’ve heard, this project may start as early as just after Songkran. It sounds like a massive undertaking, so hopefully it won’t be as disruptive as it could be.
The Thai government has also announced $72 billion USD to be earmarked for countrywide infrastructure over the next five years. This would include improved roads and drainage, with particular care given to investment and industrial zones to appease foreigner investors and factories. The plan also includes over $11 billion in water management measures to prevent repeat of last year’s terrible floods as well as a new high-speed rail link between Bangkok and Chiang Mai.
This is all incredibly positive news that will ensure continued growth and encourage foreign investment. Maybe most importantly, it also shows how healthy the Thai economy is. To me, this is all forward momentum that’s nothing but positive.
This article was prepared by Stu Sutton, managing director of Jomtien Property. I welcome any comments, criticisms and particularly adulations, so please feel free to contact me at stus@jomtien-property.com or 086 108 6575, or visit Jomtien Property’s extensive website at www.jomtien-property.com
