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Published on March 19, 2008

A fresh wave of investment is coming to Hua Hin and Cha-am as local and foreign developers scramble for land after a year-long slump.

"Prices of beachfront land in Hua Hin jumped to Bt50 million a rai, while in Cha-am they are between Bt20 million and Bt30 million a rai," said Praphaisith Tankeyura, managing director of the Boat House Hua Hin, a 75-rai resort project.

"That's almost double from only a couple of years ago."

Thai developers say investors from Singapore, Russia, Dubai and the United States have given a fillip to property in the beach towns as they unveil plans for resort homes.

"A group representing US retirees has bought a 20-rai plot near the Sofitel Railway Hotel to build a low-rise condominium," Praphaisith said.

Other investors are also stepping in. A Singaporean group has joined hands with businessman Sakda Boonyarak to build on a prime 8-rai plot near Baan Kaimuk. Yet another group from Singapore is building a five-star hotel in Cha-am.

The foreign interest has spurred sales in the region.

Songkran Issara, who heads development firm CIS, said sales of his Chaan Talay condominium surged last month.

"The political change has been positive, and the improved consumer confidence has spurred sales,"  he said. "After a slow year, we've sold 60 per cent of our 175-unit project."

Most of Songkran's buyers are locals.

Praphaisith said his buyers were also largely Thais but added that the recent wave of buying was from investors in new markets like Russia and the Persian Gulf states, both rich with oil money.

Major Development (MJD), which last year launched its Mykonos condominium, is now preparing to build its second beach condominium: Marrakesh.

"Our first condominium was so well received that we've decided to continue investing in Hua Hin," said managing director Suriya Poolvoralaks.

Affordability is the key when selling to Thais, he said.

Mykonos prices start from Bt2.7 million, the same as Sansiri's Baan Nap Kluen in Hua Hin.

Sansiri, a high-end developer, has started work on a new condominium project set on a 9.5-rai beachfront plot, said Samatcha Promsiri, a top executive with the company.

The price of its smallest apartment, about 50 square metres, will be about Bt2.7 million, he said.

"Much of the demand for seaside homes in Hua Hin is local. Hua Hin and Cha-am are favourite holiday destination for Thais, more so than Phuket or Koh Samui,"  Samatcha said.

Praphaisith agreed: "Our buyers are mostly well-to-do Thais who like the Hua Hin-Cha-am area because they can drive here from Bangkok in less than three hours."

Prices are still reasonable, not quite as high as in Phuket or Koh Samui, which cater largely to foreigners, he said.

"Affordability is the key," Praphaisith, whose Boat House units sell from Bt2.4 million, said.

"More Thais buy resort homes as an investment, because over time taking a holiday here is far more sensible than flying abroad to places that offer very little in terms of value. Most of my buyers pay cash. Out of the 50 who have transferred ownership, only three took out mortgages. The rest paid cash."

Itthi C Tan

The Nation