Ko Samui Properties November 2011 Blog

Well the rainy season has started and all the usual places flooded very quickly – Beach Road south of Samui International Hospital and Dow Market as I write this. Some debate as to whether this is the NE Monsoon setting in or just heavy tropical storms. Well the weather charts indicate the wind is from the east so it is certainly moving in the right direction. What is more interesting is if the new drainage that has been installed will cope with the floods or not. The are just in the process of completing the new drainage outside our office and they have used large pre-cast concrete sections buried underground with large drain covers which we hope will be big enough to cope. Certainly better than the weed filled ditch we had before. The other advantage for us is that the rather insubstantial bridge across the ditch to our office has now gone and been replaced with a concrete driveway.

The Local Authority has over recent weeks been promoting their "Disaster Planning" following the severe damage suffered by the island over the last twelve months. This extends from dealing with floods, to landslides, long power failures and even a tsunami. Additional emergency vehicles were seen arriving on the island including fire engines and ambulances together with large pumps. We have seen an improvement over recent years as new drainage has been installed in that the floods have dispersed rapidly once the rain has stopped. I doubt we will ever see the large monsoon drains that you can see in Singapore or even Los Angeles, but work has been done to clear the Chaweng Klong. Obviously Samui has not suffered in the same way as the north of Thailand and Bangkok.

If you are considering opening a Personal Savings Account, have the following in mind. If you open joint account, you will probably not get internet banking – this has been the experience of two of our clients recently with Bangkok Bank (who actually have a very good internet banking system) and Siam Commercial Bank (who do not). If you want internet banking it seems it must be in a single name. Please do not ask me to explain the logic to this. If I have a joint account with my wife we can both have ATM cards and can take money from the bank but no internet banking. If I have a sole account she cannot access my internet account but I can give her the access details so she can use it.

The real estate market seems to be going through an inconsistent phase, although one could probably say that about much of the last couple of years, but enquiries seem to ebb and flow from many to none from week to week. What is consistent however is the number of properties being newly listed which is of course adding to the stock available. If you check our Newsletters for the past few months you will see we are adding properties all the time. I wish we were selling them at the same rate. All these properties are being offered by a number of agents on the island so they all have plenty of exposure to buyers. The consequence of course is that buyers have more and more choice and are very price conscious. Sales are happening, but your property has to be correctly priced or it will get passed over.

For a full copy of this Newsletter, email me at hbonning@kosamuiproperties.com

Ko Samui Properties Blog for October 2011

Included in this Newsletter is an article by Dr Theerathon Tharachai which discusses the relationship between design and construction standards when developers are faced with increasing building costs. Whilst the article refers in particular to high-rise buildings in Bangkok with emphasis on safety it highlights an issue we need to be aware of here in Koh Samui as well. Whilst we have few high rise buildings, the implication in the article is that developers and contractors will cut corners to maintain profit margins and that is something to be seriously considered. Before I am accused of making false accusations, may I say that I have no experience of this happening on Koh Samui and I am simply raising a warning flag that this could happen and is a possibility we all should be aware of.
The easiest way to reduce costs is by using inferior or sub-standard materials and if you are buying a new property either rom a developer or having one built, you need to be sure that what is built and the materials used actually accord with the specification you agreed to.
A perfectly acceptable process for reducing costs is Value Engineering. There are four basic steps in approaching this:


1) What are the requirements for the project. How should it function? What functions or performance characteristics are important? What does the object do? What must it do? What should it do? What could it do? What must it not do? This could relate to aspects of the structural design or materials to be used.
2) We then ask - What are the various alternative ways of meeting the requirements? What else will perform the desired function?
3) We then look at all the alternatives and assess them by evaluating how well they meet the required functions and how great will the cost savings be.
4) In the final stage, the best alternative will be chosen and presented to the client for final decision.


All developers should utilize Value Engineering as a matter of course. From my experience here on Samui, that is not always the case and I have seen some horrendous cases of over engineering due to poor design due to lack of knowledge or consideration of alternatives. When I first came to Koh Samui ten years ago, everything was built using reinforced concrete frames. The use of a steel frame was unheard of. As time has passed I see more and more steel frame buildings being built and steel components incorporated into some of the larger villas. The use of steel has allowed greater spans than previously possible except by creating impossibly large concrete beams – and I have seen some of them!
So alternative design solutions and alternative materials are quite acceptable if they meet the required standards and save money. You just need to be sure that it is not the last factor only that influences the choice.


The real estate market is slowly gaining pace but as reported previously mainly in the lower ranges. We have been receiving more serious enquiries recently than for a long time and interest has moved up into the 10-15 million range whereas previously it was almost exclusively under 10 million. However, before everyone starts putting their prices up, the only properties selling in that range are those that have already been discounted. What is also noticeable is that with so many agents having disappeared over the last year or so, there are signs of one or two coming back, unfortunately with little real estate experience. So just be careful who you are dealing with.

For a full copy of this Newsletter please email me at hbonning@kosamuiproperties.com

Real Estate Valuations in Thailand for Overseas Courts

Whilst recognised in most countries throughout the world The Royal Institution of Chartered Surveyors has not yet been accredited in Thailand. Equally Thai Valuers are not accredited in many countries overseas. This creates an issue for anyone requiring a formal valuation from a qualified valuer of property in Thailand to be used for official purposes, usually in the Courts, overseas.


As a Chartered Surveyor with 40 years of international real estate experience, the majority of overseas Courts will accept a Valuation Report prepared and signed by me. Different countries have different requirements and much depends on the purpose of the valuation. Sadly many valuations I have carried out are for divorce matters. In the UK there are specific rules with regard to such valuations and they must comply with Part 35 of the Civil Procedures Rules. In Australia the report must be accompanied by an Affidavit witnessed by a Notary.


All formal valuation work is carried out in accordance with the International Valuation Standards Committee of the Royal Institution of Chartered Surveyors. A formal valuation report will usually consist of a Valuation Certificate, a full Valuation Report accompanied by location plans, photographs, copies of land titles and copies of my Professional Diplomas. Before accepting valuation instructions I will determine the purpose of the valuation and where it is to be used. I will then issue a Letter of Instruction to be signed and returned to me. I will then make arrangements to inspect the property and obtain all relevant documentation. Provided I
have been given all necessary paperwork to complete the valuation, the final report will be available seven days after the inspection.
Please contact me for further information at hbonning@kosamuiproperties.com


The real estate market is slowly gaining pace but as reported previously mainly in the lower ranges. We have been receiving more serious enquiries recently than for a long time and interest has moved up into the 10-15 million range whereas previously it was almost exclusively under 10 million. However, before everyone starts putting their prices up, the only properties selling in that range are those that have already been discounted. What is also noticeable is that with so many agents having disappeared over the last year or so, there are signs of one or two coming back, unfortunately with little real estate experience. So just be careful who you are dealing with

For the full version of this Newsletter which also includes all new property listings, price reductions and local news, please email me at hbonning@kosamuipropertie.com

As we all know value is a factor of supply and demand although the definition of value can vary – but that is a discussion for another day. Demand for real estate here in Samui has been depressed for many months now and the reasons are well know – world economy, lack of credit, politics etc. But what about the supply side?

Despite the low level of demand there are still developers creating new stock and new properties are coming onto the market all the time. I am aware of at least three developers who have built the first house on their development and quite rightly stopped because it has not sold. There are still individuals building properties with a view to selling and at the lower price levels having some success. The consequence though is that the stock of available properties is increasing faster than they are selling. This has a further knock on effect in that the new modern stock of properties is more attractive than the older properties which inevitably means the old properties will decrease in value faster.

This then begs the question – with the thousands of Rai of developable land in Samui, why have land prices not fallen at the same rate as residential house prices? The main reason of course is that the majority of this land is still held in Thai names and there is generally no pressure on them to reduce the price from what was achieved during the boom days.

What then are factors that would help to maintain values? Apart for increased demand, which cannot be controlled, the obvious answer is to limit supply. It will take some considerable time for the existing supply of properties available to be taken up, so perhaps now is the time for the local authority to look more closely at how the excesses of the past can be controlled in the future. In a small way they have already done this with height restrictions so we do not have masses of multi-storey buildings dotted around the island as can be seen in Pattaya and Phuket. Yes I know we have some, but not many. The zoning restrictions brought in are still very flexible in respect of residential properties so what more can be done?

Take for example San Francisco. In 1986 they passed Proposition M, a quite complex piece of legislation, part of which restricted the total of planning approvals for office space to 950,000 sq ft a year. For a major city this is quite significant and the consequence was that new development was restricted and rental rates stabilized as did consequent capital values. It was more than just a restriction on planning permissions, but was also very detailed as to how development of any kind would be controlled. Washington DC has for years had height limits on buildings and this helped to maintain values. At the other end of the scale Dallas in the same time frame had no zoning laws or restrictions as a consequence of which the real estate market almost died a death with rampant uncontrolled development.

How do we translate this into what would work in Samui. The reason that Proposition M was passed was due to local pressure from the urban population. Do we think that the indigenous population of Samui would support far reaching restrictions on development? Would those restrictions be in the form of number of approvals or a tightening of the zoning laws? Will it be imposed economically due to lack of infrastructure and communications? I wish I had an answer to that.

We will have to wait and see.

There is one aspect though that should have been done and still could be. Many countries have linkage policies. The price for granting planning permission is a contribution to the cost of providing the infrastructure to that development or indeed providing that infrastructure. Many of the islands problems with electricity, water supply and drainage could have been dealt with adequately had this been in place previously. Wise after the fact some will say. Not really, it is any issue I have never understood in the ten years I have been here.

The real estate market is slowly gaining pace but as reported previously mainly in the lower ranges. We have been receiving more serious enquiries recently than for a long time and interest has moved up into the 10-15 million range whereas previously it was almost exclusively under 10 million. However, before everyone starts putting their prices up, the only properties selling in that range are those that have already been discounted. What is also noticeable is that with so many agents having disappeared over the last year or so, there are signs of one or two coming back, unfortunately with little real estate experience. So just be careful who you are dealing with.

For a full copy of the Monthly Newsletter - please email hbonning@kosamuiproperties.com

New Listings and Price Reductions at Ko Samui Properties

Check out all our New Listings here
http://www.kosamuiproperties.com/

and our latest Price Reductions here
http://www.kosamuiproperties.com/stoppress/stoppress.html

and you can see both on our Ko Samui Properties Facebiik page here
https://www.facebook.com/#!/pages/Ko-Samui-Properties/135017444890

Next Newsletter due out 1st August.

Ko Samui Properties Blog for July 2011

Once again I must come back to the issue of having all your paperwork up to date and correct and knowing where it is. It is very frustrating, particularly in this market, to go through the process of negotiating a sale only to find that the seller does not actually have the original paperwork to hand causing delays and frustration on all sides.


Thailand is gaining a reputation for medical tourism due to the extensive facilities available and reasonable charges. I have always found dentists here to be very good and cheap compared to the UK. A filling is Baht 1,000 which is equivalent of GBP 20 as opposed to the NHS quoted price of GBP 47 and private treatment at GBP 77 – 100+. There are some very good hospitals, mostly in Bangkok, providing a wide range of treatments and by the time you get this Newsletter I will have undergone cataract surgery. Over the years I have had the “pleasure” of visiting many hospitals (unfortunately as a patient) in many countries so entering the doors of a hospital for any reason is not one that fills me with trepidation. Nevertheless, there is inevitably a certain amount of anxiety when faced with surgery on your eyes – in my case cataract surgery on both eyes.

If anyone is considering this let me allay your fears. It is a wonderfully simple and quick procedure. Arriving an hour and a half before the appointed operating time you relax in comfortable arm chairs as a nurse administers a series of eye drops. Then in the pre-op room you are swathed in the usual operating gowns and have the first of two injections. This for me was the most anxious time – having someone stick a needle into the flesh at the side of the eye. Why I was concerned I do not know. Hardly felt a thing and that just froze the area for the main injection which was totally painless. All you could feel was tightness around the eye as the anesthetic took hold. Then the operation began. All I could see were a pair of bright lights moving around and then it was all over. Ten to fifteen minutes after going into surgery I was back in the recovery room where a nurse explained the cleaning process and schedule for drops over the next two weeks, followed by the cashier of course and that was it. Having arrived at 06.30 we were out before 10.00. The eye was covered with a loose dressing and next day I went back for this to be removed and a post op check up. As soon as they took the dressing off I could see the difference. Absolutely amazing. My long distance sight is virtually perfect but I need reading glasses. Some irritation as the eye heals for a few days. The operation on the other eye followed a week later with the same procedure.

I went to the Rutnin Eye Hospital on Asoke in Bangkok. A specialist eye hospital also used by the Royal family and the treatment there lived up to their first class reputation. You can contact them through their web site www.rutnin.com/eng/ . Their charges are reasonable. I recall my first visit when cataracts were diagnosed cost me Baht 1,200. The surgery cost will depend on a number of factors and if anyone is really interested send me an email and I will let you have a breakdown of the costs.

The big event at the moment is the General Election on 3rd July. No polls are allowed to be published in the immediate run up to the election but I would expect to see a north south divide once again.

The real estate market is slowly gaining pace but as reported previously only on the lower ranges. We have been receiving more serious enquiries recently than for a long time and interest has moved up into the 10-15 million range whereas previously it was almost exclusively under 10 million. However, before everyone starts putting their prices up, the only properties selling in that range are those that have already been discounted. What is also noticeable is that with so many agents having disappeared over the last year or so, there are signs of one or two coming back, unfortunately with little real estate experience. So just be careful who you are dealing with.

For the full version of this Newsletter please email hbonning@kosamuiproperties.com

Ko Samui Properties Blog for June 2011

This is late again as I was in Bangkok having eye surgery - full report on that in the July Blog!

Last month I commented again on the relationship between Bangkok Airways and tourism on the island and the negative effect their airfares were having. They have been widely criticised in the Press and on-line and to their credit they made an effort and offered a restricted number of seats on the Bangkok-Samui-Bangkok route at Baht 4,300 return up until the end of July. Or so it was reported. Nothing on their Web site and nothing in their promotions except ones to increase the frustration when you see you can fly from Bangkok to Chang Mai or Phuket for around Baht 2,000. I would be interested to hear from anyone who managed to get one of these fares. Even the Residents Card is of little use with regard to fares. Discounts are only available on their highest fares and it is often cheaper to ask about their Promotional Fares – but you have to ask because the booking staff will not volunteer that information.


I have always been very supportive of Bangkok Airways and the risk they took in building the airport. However, enough is enough. Personally I consider Samui Airport to be one of the worst designed airports in the world. It looks stunning but is totally impracticable. In every airport you can expect to walk a good distance from check-in to the gate – but not in the boiling sunshine or torrential rain. Buggies? If you are lucky and forget it on a late flight. I have complained on more than one occasion when I have been to Bangkok for the day and returned on the last flight and requested a buggy to take me from arrivals to the departure car park. Even in the pouring rain they were reluctant to help. The response of Bangkok Airways is to start charging for the departures car park. Baht 200/day. Not a huge amount and I know that all airports charge for parking but for someone working on the island, having a Residents Card and making a one or two day trip to Bangkok, you would think they might just provide free parking – but then they would have to provide transport from arrivals!

The real estate market seems to be picking up somewhat. We have been receiving more serious enquiries recently than for a long time and interest has moved up into the 10-15 million range whereas previously it was almost exclusively under 10 million. However, before everyone starts putting their prices up, the only properties selling in that range are those that have already been discounted. What is also noticeable is that with so many agents having disappeared over the last year or so, there are signs of one or two coming back, unfortunately with little real estate experience. So just be careful who you are dealing with.

For the full version of this Newsletter please email hbonning@kosamuiproperties.com