How to sell properties in Koh Samui

The first question we are asked once we have inspected a property is “What is my house worth?” And therein lies an immediate issue. Worth to whom? In a normal market I would follow the guidelines of the International Valuation Standards Committee of the Royal Institution of Chartered Surveyors which states that Market Value is defined as ‘The estimated amount for which a property should exchange on the date of valuation between a willing buyer and a willing seller in an arm’s-length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion.’ Whilst I may have a willing buyer and a willing seller, the seller may be under a great deal more pressure to sell whilst the buyer may be under absolutely no pressure to buy. This is a buyers market and when offering a property for sale the expectations of the seller need to be established. Is there an urgent reason for the sale and do they have a time limit they are working to? We do get a number of sellers who just wish to move on and are in no particular hurry and will wait until the market improves. But for those people who need to sell quickly there is a different approach. The question that I ask is “What is the lowest price you are prepared to accept at this moment in time to achieve a sale?” This is no longer about getting the best price, this is about achieving a quick sale without the seller losing money if possible. Sometimes it isn’t – but that is a decision for the seller. Take into account the fees involved in the sales process and allow something for negotiation and that is the figure at which you go to the market.

Will this work? Absolutely. In the last six weeks we have applied this approach to two properties. Both sold within two weeks of going on the market. The sellers were happy because they achieved their objective in selling the property at a price acceptable to them and the buyers were happy because they had bought something which was good value. But I repeat – this is not about achieving the highest price – this is about achieving a sale in a very weak market.

For anyone interested in the convoluted mess of Thai politics, this article in the Bangkok Post last month may be of interest.

The NE Monsoon arrived last week with quite a bang early one morning with a massive thunderstorm right overhead. The low pressure systems that run in a string across this region have now moved south so I think we will be seeing the usual rainy weather for this time of year.

I have commented in all recent Newsletters about the fall in asking prices, and indeed in sale prices as these reduced priced properties are taken up. I have for sometime believed that this trend of 20-30% price reductions is not restricted to Koh Samui or indeed residential properties. This has been confirmed in a study by the RICS which shows that values in the commercial property market in Singapore have fallen by 30% in the nine months to June this year and office rentals declining by as much as 50% in some sectors.

And property prices here continue to fall! If you check our web site and look at the Hot Press Offers you will see a great number of properties with prices that have been reduced from between 15% and 50% with an average reduction this month of 33%. These reductions are now beginning to produce sales and, although still not many, there are a few more buyers around than there were a few weeks ago. NEW REDUCTIONS EVERY MONTH!

See in particular the following properties – CTRL + click to follow the link:

2 bedroom house in Bophut with communal garden and pool. Originally Baht 5.7m. Now available at Baht 4.5 million.

3 bedroom luxury villa between Chaweng and Bophut with pool – originally Baht 49.5 million. Now available at Baht 36m.

2 bedroom house in Bangrak with pool – originally Baht 9 million. Now available at Baht 6 million.