The ASEAN Property Markets, Its Performance And Direction

Transcription

1 The ASEAN Property Markets, Its Performance And Direction Sopon Pornchokchai, PhD D.FIABCI CRS MRICS President, Thai Appraisal Foundation 1

2 1. OUR ARENA 2

3 IRISE, August 6, 2015: Manila 3

4 1 st time to be ARENA August 25-26, 26, 2016: Bangkok 4

5 1 st time to be ARENA August 25-26, 26, 2016: Bangkok 5

6 1 st time to be ARENA August 25-26, 26, 2016: Bangkok 6

7 March 3, 2017: Kuala Lumpur 7

8 June 24, 2017: Phnom Penh 8

9 August 17, 2017: Bangkok 9

10 2. THE SPEAKER 10

11 President, Thai Appraisal Foundation & Director, Thai Real Estate Business School Representative of the International Association of Assessing Officers in Thailand Consultant, Min. Finance, Cambodia, Indo. Vietnam, ESCAP, UN-Habitat, etc. Lecturing in valuation and real estate in Brunei, Cambodia, India, Indonesia, Myanmar, Nepal, the Philippines and Vietnam. Research master pieces: the discovery of 1,020 slums (1985), CAMA (computerassisterd mass appraisal) modeling (1990), forecast of 300,000 unoccupied housing units (1995 and 1998), study for property information centre (2000) and land value modeling (2002), Valuation Roadmap, Ministry of Finance, Vietnam (2006), Valuation Lecture Series, Ministry of Finance, Indonesia (2008). World Bank Jakarta (2010), UNHabitat Vietnam (2011), Cambdia Fin Ministry (2012), ASEAN Property Surveys & UN World Cities (2015), Global Municipality (2017) 11

12 Pornchokchai, Sopon. Thailand s Real Estate Valuation in Gelbtuch, Howard C., Real Estate Valuation in Global Markets, second edition. Chicago. Appraisal Institute (2011), 617 pp. Pornchokchai, Sopon. Housing Finance Mechanisms in Thailand. Nairobi. UN- HABITAT (2008). ISBN: , 617 pp. 12

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15 Valuing hotels in Sao Paolo and Salvador,

16 Valuing casinos in Botswana, Lesotho, Namibia and Zambia,

17 3. INDIA-CHINA 17

18 After my MSc at AIT, I got a United Nations scholarship to further my study in KULeuven, Belgium in My Chinese classmate from Beijing earned only USD 16 per month! Believe It or Not. 18

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23 Robocop 1993 and the Samurai. Japan Robocop 1993 and the Samurai. Japan investors labelled as an economic animals NEXT MAYBE CHINESE MONSTERS. 23

24 Juwai reveals top 10 Chinese buyer picks for ws/2017/02/juwaireveals-top-10-chinesebuyer-picks-for

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26 Agency for Real Estate Affairs: 26

27 The Assessment of the Economy & Real Estate The first three questions were to allow Indian valuers to assess Indian economy. It was assessed that out of the 10 as the best, the economy was assessed at 5.7 in 2016, 6.1 in 2017 and expectedly 7.4 in It should be mentioned that the standard deviation is quite low. This implies that the results were somewhat reliable. It implies that Indian valuers assessed that the economy has been fine and would be better in the future. The difference between 2016 and 2017 was little but the increase in 2018 would be quite significant. The future of Indian economy is bright. In terms of property markets in India as a whole, Indian valuers also assessed something similarly to that of the economy. Out of the 10, property markets in India as a whole was assessed at 5.4 in 2016 and the same 5.4 in There was only little difference in the standard variation. However, it was expected to 6.4 in This implied that property market might get start for recovery from the previous boom and price escalation. So Indian property markets would be improved in the near future. Source: Prospects of India Real Estate Investment, AREA Press Release No. 325/2017: August 18,

28 Traps of Buying Properties in USA, UK & EU 1. High Property Taxes 2. Estate Tax 3. First time buying tax, i.e. 15% Still many want to buy. Perhaps, money laundering. 28

29 Taiwan Policy to Chinese Investors. (cannot do resale within 3 years, stay in Taiwan for no more than 4 months/year and get loan for only 50% of the value). 29

30 4. LESSONS LEARNT 30

31 Why experienced HK property companies cannot compete with local Chinese ones? 31

32 Daimaru, Tokyu, Isetan etc. Not so successful in our region. 32

33 Indonesia s s Property King 33

34 Malaysia s s Condo King 34

35 The former biggest developer, Mr.Anant of Land & House previously invested in Indonesia and the Philippines but not now. 35

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41 260 ha launched in mid Villa of 200 units priced the same for 2 years. Some villa area converted to be townhouses. Few of the 70 completed shophouses occupied (the total 300 units planned). An 18-hole golf course completed. Some 200 existing members out of the 400 members expected. Other phases still pending. 41

42 Camko City from Korea with vast experience but cannot compete with local Cambodian developers. 42

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47 Of the total 8 buildings completed, there are 800 units of condominiums, 120 occupied mostly by renters (6 units of owners). 103 units still available for sale. 30 units currently offered in a promotion for a discount of 30% The other 7 buildings which are under-construction already sold to a property fund in Korea!?! A 2-bed condominium unit of US$ 150,000 can be rented at US$ 9,000 or 6% gross rent per annum. 47

48 5. VIEWS OF ASEANs 48

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50 The Economy On the perception to the economy of Cambodia in 2017, some 21% said that the economy in 2017 is a lot better than 2016, some 40% said it was slightly better. Only 29% said it was similar to Those who perceived that the economy this year was slightly worse than last year or a lot worst were only 7% and 2% respectively. Cambodian economy were of high hope for the beneficiaries. In addition for the 2018 economy, still some 14% said it would be a lot better than 2017, 26% said it could be slightly better than Those who saw it the same were 38%. However, there were some 19% said it could be worse in 2018 than in This also implied that even for next year the economy of Cambodia would be on the rise. 50

51 The Property Markets Considering property markets in Cambodia. Some 19% of the respondents said the markets were a lot obetter in 2017 than in The largest proportion of 41% said it would be slightly better in Those who perceived it would be the same as in 2016 was some 27%. Only 12% and said that it could be slightly worse than in None said it could be a lot worsening than in In the case of 2018, Cambodian beneficiaries still perceive positively. 18% said the markets would be a lot better than in One fourth (25%) said it could be slightly better than in % said it would be similar to However, there were one fourth (23%) said it could be slightly worsening and those who perceived very negatively were oly 4%. 51

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54 ASEAN Investment assessed by Cambodians. AREA Press Release No. 185/2016: May 25,

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56 The followings are the results of the survey conducted. 1. Considering economy, the largest proportion of them (44%) said that the 2017 economy must be better than the economy in Those who perceived to be unchanged was 26% Those who said worse or worst compared to 2016 were 30% and 13% respectively. On the whole, the economy of Myanmar which is the most active one in the Region would still grow very positively. 2. Considering real estate markets in Yangon, 45% said it would be better than the markets in Some 34% said it would be the same as that in 2016 and only 205 said it would be worsening. Actually, real estate markets would move in accordance with the economy. Since the economy of Myanmar is good, real estate markets would be very bright as well. 56

57 3. Considering the property markets in Myanmar as a whole, some 42% still believe that would be better than last year. Some 33% said it would be the same which was good last year too. Only some 25% said it would be worsening which should be unlikely to be so. 4. Considering the most active sectors in real estate in 2017, the ranking is as follows: First, it would be rental apartment, 29% voted. Second, it would be land markets, 22% voted. Land is a factor of production. Third, it would be office space, 15% voted. It could be observed that the need of office space is growing a lot resulting from the influx of investment into Myanmar. 57

58 Fourth, it would be shopping centre, 12% voted. There should be quite a number of newly planned shopping centres in Yangon. However, the purchasing power is still low but growing rigorously. Fifth, it would be industrial estates or industrial properties, 11% voted. Sixth, it is housing estates including residential condominiums, voted for 10%. This market still needs a certain period of time to wait for strong local affordability. 5. There is an interesting question if he/she could buy a house abroad, where are his/her destinations. The followings are the answers. 58

59 First, it is Singapore with 44% voted. It is very amazing that this tiny city state wins the preference of the investors of Myanmar. It looks clean, tidy, secure for them. Second, Thailand has been voted for 30% This is because there are millions of people from Myanmar working in Thailand. They may feel that Thailand is their 'second' home. Third is the United States of America. Although it is quite far away from Myanmar, United States was voted for 15% This is the land of new hope, new lives particularly for the new generations. The rest consisted of Malaysia (4%), Australia and New Zealands (3%), Europe 3% and thelike. 59

60 Opinion of Myanmar Businessmen Opinion Econ R.E. Better 66% 72% Same as % 22% Worse 3% 6% Where to Buy Homes Abroad Singapore 43% Thailand 33% Australia 10% USA 5% China 3% Malaysia 3% Vietnam 3% Sweden 3% 60

61 24% of Laotian businessmen wanted to buy properties in Thailand. Condominiums constituted 43% in the wish list. They like to buy properties in Pattaya (37%), Bangkok (31%), Udon Thani and Nong Khai (23%) and Phuket Hua Hin (resort destinations) (9%). Source: AREA Press Release, 68/2010, November 9,

62 6. SMEs GO ABROAD 62

63 Small Land Subdivisions in PP 63

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67 Community Malls, PP. 67

68 T.K. Avenue: with cenamas and many anchor tenants. 68

69 Small Row House Project De Paris Residences, Jakarta Location: Jalan Daun Karya Raya Kalisuren, Tajur Halang, Bogor, Jawa (Zone Depok) Developer : Daun Karya Agung Details: project area 14 hectares Total 1,015 units, Sold 636 units (63%) including Town House 1 Storey Land size 60 sq.m., useable area 36 sq.m., price 214 mil. IDR Selling Point: low-priced housing project. 69

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76 start with something small to test the market, to accumulate experience, to quest for managerial expertise and to gain success step by step. 76

77 7. OUR ASEAN FUTURE 77

78 COMPARISON OF ASEAN COUNTRIES AND USA TO THE ASEAN Countries Land Area Population GDP Popu- (Excluding Com- Million Com- Den- Growth %Urban Bil- Total Per per cap % of Growth lation Water) pared* pared* sity/ per Popu- lion Com- cap Com- Agri per below Sq.Km. sq.km Year lation US$ pared* US$ pared* Sector Year Poverty ASEAN 4,326, % % % 48% 7, % 11, % 11.9% 4.8% 15.4% Thailand 510,890 12% % % 50% 1,161 16% 17, % 8.9% 3.2% 12.6% Brunei 5,265 0% % % 77% 34 0% 77, % 1.1% 0.4% 0.0% Cambodia 176,515 4% % % 21% 59 1% 3,694 32% 26.7% 7.0% 17.7% Indonesia 1,811,569 42% % % 54% 3,028 41% 11, % 13.7% 4.9% 11.3% Laos 230,800 5% % % 39% 41 1% 5,836 51% 21.7% 7.5% 22.0% Malaysia 328,657 8% % % 75% % 27, % 8.2% 4.3% 3.8% Myanmar 653,508 15% % % 34% 311 4% 5,468 48% 26.3% 8.1% 32.7% Philippines 298,170 7% % % 44% % 7,814 68% 9.7% 6.4% 25.2% Singapore 687 0% % 8, % 100% 487 7% 84, % 0.0% 1.7% 0.0% Vietnam 310,070 7% % % 34% 595 8% 6,245 54% 17.0% 6.1% 11.3% India 2,973,193 69% 1, % % 33% 8, % 6,884 60% 16.5% 7.6% 21.9% Japan 364,485 8% % % 94% 4,932 67% 38, % 1.2% 0.5% 16.1% China 9,569, % 1, % % 56% 21, % 15, % 8.6% 6.7% 3.3% USA 9,161, % % % 82% 18, % 57, % 1.1% 1.6% 15.1% Campared* = compared to the ASEAN; as of Aug

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80 Pattaya & Hua Hin,, Thailand dominated by: 1980 Arab 1990 Japaneses 1995 Westerners 2000 Scandinavians 2005 Russians 2015 Chineses 2025 Indians? 80

81 Yoshi Takita, ABR CIPS SRES AHWD CBR E-pro GRI HAFA RSPS HPD Standards are not different in the world at all. We need ASEAN ones. Good to have titles but no gaurantee of better services. Costs too high to afford. Serious Indemnity insurance is in need. Effective professional control and serious continuing professional development are the keys. 81

82 THANK YOU Sopon Pornchokchai, PhD PhD D.FIABCI CRS MRICSM FB: /sopon.pornchokchai/ 82