Buyer Defaults Hitting Residential Sales Pace
In talks with developers on the island there is an emerging trend of buyer defaults in the property sector back of the current economic downturn. A number of resale units have been placed back on the market recently including high profile projects in Bangtao/Laguna, Kamala and Nai Thon. Tracking sales pace in various projects the numbers are bearing out the "for sale inventory' is on the rise.
Developments which had either been fully sold out or showing a good number of confirmed sales; now have inventory placed for sale. A combination of buyers who have some progress payments down, or those still in the due diligence phase and are walking away from reservation payments. Recently some projects which had a good percentage of progress payments in and buyers walked away have simply remarketed the units well below existing retail pricing; with the logic that the end revenue combining the default amount retained and low resale equals the current retail level.
What the trend does demonstrate is twofold in that retail pricing is under the gun with new buyers expected deep discounting and that the resale market is becoming a larger segment of the total real estate market. As not only business cash flow but personal finances get crunched, the expectation is this situation will be carried over into the coming high season.