Are New Condos Really Worth the Money?

In a column in March 2006 I noted that property speculators are pushing up the prices of new condominium units, which one might consider are already high compared to older ones in Bangkok.

Today let’s take a look at an example of this phenomenon. There was a new condominium launched recently on a plot of land adjacent to another older building. The latter is a little over 10 years old, but when it was first constructed it was regarded as one of the few genuine grade A condominiums in Bangkok. It has a lovely podium level, with a tranquil pool area, tennis court, every other facility you would expect, and each unit measures at least 300 square metres. Why am I telling you this? It’s because the sales prices in this condominium are little over one-half of the sales prices in its new neighbor-to- be.

For convenience, let’s say that the older condominium is selling for 55,000 baht per square meter and the new one is selling for 100,000 baht per sq. m. Is the difference in price really justified?

We can easily rule out the land price, as the two condominiums are right next to each other. So what is the difference?

Construction methods? Doubtful. In fact, many older condominium units are arguably more solid than the newer counterparts. Many developers producing lower-grade new condominiums are using materials, such as plastic imitation parquet flooring, which are unlikely to last more than a year or two. Also, lower-grade materials can allow sounds from neighboring units to pass through.

Facilities? Not in the case above. The older condominium has a full range of facilities already.

Calibre of the co-owners? In this case the new condominium has a number of smaller units, geared to perhaps a more middle- class market than the older building which comprises large units only.

The appearance of the building? This must be it. The new condominium will have a nice, shiny new lobby, a clean and newly painted exterior, freshly laid flooring in the common areas, and new furniture. The old condominium is waiting for a repaint, and a new lobby would be nice too.

Then why don’t the owners of the older condominium make these improvements? Probably because when it comes to buying a condominium, people are ready with their chequebooks, but for ongoing maintenance, this is not the case. Or maybe the condominium committee members aren’t as good at selling-in this case the idea of a necessary cosmetic upgrade to add value – as those working for the developer.

Does this mean that in five or 10 years’ time the new condominium will look like the old condominium? Is buying a condominium like buying a car; the price depreciates over time?

Well, if you gave the older condominium mentioned above a repaint, gave it a new lobby with new furniture and resurfaced the podium level, and renovated the small amount of common space in front of the units, and then the difference between the two would not be that great. I don’t see many prospective buyers drilling into the concrete structure to check the integrity of the concrete.

Bear in mind that if you buy a unit in an older condominium, there’s a good chance that inside there could be a lot of old wooden fitted furniture that’s 10 years out of fashion. You may want to rip the whole lot out and start from scratch. If you carried out a thorough renovation of the unit-new floors, new furniture, new electrical and sanitary fitting, then you would probably be looking at spending in the region of 10,000 baht per square metre.

So perhaps it all depends on how much you are willing to spend on a shiny lobby. I myself generally spend about one minute per day walking through the lobby. Most of my time I spend inside the unit. How about you?

Give Your Home Curb Appeal and Watch it Attract Many More Buyers

Curb appeal is all about bringing out the beauty of the front part of your home. Curb appeal is that subtle quality that makes your home welcoming, inviting, warm, fresh, appealing and interesting. It is what makes a potential buyer want to see more of the house as he/she looks at it for the first time. There are countless stories from real estate agents of buyers refusing to get out of the car to view a house simply because the outside was not well kept. If you have already given the inside of your home a makeover, it is time to deal with the outside so that it does not drive potential buyers away.

It is true that money is not easy to come by, but do not hold back on giving the outside of your home a beauty treatment. You do not have to put yourself in a financial bind to give your home curb appeal, but do not neglect it or buyers will go on to the next house on their list.

The first thing you should do is walk outside and view your house objectively. Try to find the above-mentioned qualities…welcoming, inviting, warm, fresh, appealing, etc. If you cannot see them, then it is likely that no one else will either. Try to remember what attracted you to your home when you drove up and looked at it for the first time.

Perhaps you saw an attractive front door with a well-painted door frame. If the paint on your front door and door frame has faded and/or cracked, then it is time to sand it down and repaint it. If your door is natural wood, then clean and varnish it again. You will be surprised how your wooden door will glow with a good cleaning, treatment and varnish.

Artists use focal points in their artwork to draw the viewer’s eye. No matter how modest your house is, you can find a focal point or something of interest to draw attention. There are details such as shutters, brackets, moldings, eaves, windows and window frames which can be used to draw potential buyer’s eye. You should use contrasting, not too bold, colors that show attention to detail.

People walking up to your home will look at your lawn, and they will notice any worn, brown or missing patches. Make sure you take care of those and also make sure that you mow the lawn. While you are at it, fill your planters with bright flowers if you have them. If not, you may want to go to your local flea market and find some planters to fill. And while you are at the flea market, pick up some hanging pots and plant flowers in them.

You do not want your house looking like the rest of the houses in the neighborhood and strategically placed flowers will make sure that it does not. The idea is to make your house say look at me, without going over the top with colors that will detract rather than add to its beauty. Look at the other houses in your neighborhood and then make yours different and more attractive. That is curb appeal, and it will make your home look much better and it will hopefully sell much faster.