A Thai property show in Hong Kong last month drew a more subdued crowd than in previous years. But the modest turnout encouraged local developers to do more or think about doing more, as it was clear overseas interest remains high.

"There are two types of buyers from Hong Kong," said Raimon Land's CEO Nigel Cornick. "The first are expatriates who want a holiday home, preferably a beach-front property with good views. The second group are investors who are seeking a strong return for their money."

These two groups have been the main buyers of resort housing in Phuket and other coastal spots such as Pattaya and Samui, Cornick noted.

Raimon Land is currently launching its Northpoint condominium in Pattaya while its two projects in Phuket, namely the Heights and Kata Gardens, are drawing many overseas buyers.

Still, the fundamentals have changed in the past year. The tsunami wrecked Phuket's tourism for a short period, affecting real-estate transactions for a while.

It was, ironically, the political wrangling in the first quarter of this year that put a big dent in resort sales. No market enjoys political uncertainty and Phuket's is no exception.

Worse, using an anti-Singaporean campaign, some political groups made a feeble attempt to topple the government.

Many foreigners were shocked, having underestimated such tendencies by locals, as such actions were once thought to be exclusive to more undeveloped populations in Cambodia and Indonesia.

Thankfully, concerned authorities realised the fallout from anti-foreign movements are far more dangerous than tidal waves.

Of all the markets in the world, Hong Kong's was the most calm during this period.

"Buyers here are more sophisticated about such matters. They understand the Thai situation better than people in other places," noted CB Richard Ellis Thailand's chairman David Simister earlier. "They are constantly monitoring what is going on here."

For Phuket's Laguna Property, Hong Kong has been its most important market. Its participation in the exhibition almost always draws many buyers. But above all, the show gives the builder visibility.

"It is important to be seen and heard," noted a Laguna executive, "to assure buyers we are still in the market and that we continue to have new products and are improving them."

For Shin Home's marketing and sales director Chayika Wongnapachant, the exhibition was an eye-opener.

Chayika, who is launching the Dalaaburi retail-residential estate in Phuket, found that most of the people attending the exhibition were interested in buying beach-front homes but also looking to locate if there were new areas in which to invest.

For one Pattaya developer, the Hong Kong market today appears to be more focussed on mainland China "If anything the Chinese market offers better returns," he said.

Cornick agrees: "Buyers seeking high returns will probably find that the mainland properties offer faster returns.

"Beijing also appears to be adopting the right policies and doing the right things. Investors are pleased to see it is trying to cool the property market without killing it," said the Pattaya developer. "It has made loans more costly but buyers can still obtain them."

In short, China has succeeded better than Thailand in tapping money in search of a home with its rational, even-keel policies.

"The recent Bank of China share listing has drawn billions of dollars to the mainland, strengthening its capital market even more," he observed. "It has that upbeat, can-do feeling Thailand used to have."

Itthi C Tan

The Nation