Bangkok - Having lived and learned from the 1997 crisis, South-East Asia's property markets have so far proved resilient to the US subprime crisis and knock-on financial meltdown but they are far from immune to the global mess.

"No one can get off scot free from what's happening because global liquidity has been reduced and also the feel-good factor has gone," said David Simister, chairman of real estate company CB Richard Ellis Thailand.

"It will certainly create a slowdown and a market where for the next 18 months it's a bad time to be selling something but I don't see a situation where there will be a big slide in prices here," he added.

Ironically, several negative factors have well-positioned South-East Asian property markets for the current downturn.

Firstly, the 1997 Asian crisis forced regional banks to tighten up their lending practices to the property sector.

Secondly, with the exception of Vietnam, most South-East Asian countries have not experienced the same real estate booms witnessed in Asia's rising giants China and India.

These two factors mean South-East Asian banks, which were reeling with non-performing loans to the property sector after 1997, are in relatively good shape.

"I think South-East Asian banks are even less exposed to property that North-East Asian banks, " said Peter Tebutt, senior director of financial institutions at Fitch Ratings in Hong Kong.

And thirdly, many South-East Asian countries are still offering competitive prices and even possible returns on investments.

Not everyone is suffering.

"We just launched a new project this month and it was one of the most successful launches in our history," said Dan Simmons, director of sales and marketing for Laguna Phuket, a luxury hotels and residential complex on Thailand's Phuket Island.

In the wake of the US financial meltdown earlier this month, Laguna Phuket put 25 luxury homes with an average price of 412,000 dollars on the market and sold 15 in a snap with full reservation deposits, Summers claimed.

"A lot of people are seeing it as a safe haven," he said. Laguna Phuket, with six hotels and 700 residential units, guarantees a 6 per cent per annum return on all properties, that the listed company rents out to tourists when the owner is away.

Of course, Laguna is catering to the high-end market which is more recession-proof than most.

Not all resorts or market segments will be so lucky.

Property developers in Vietnam, which has been enjoying its first real property booms since shedding some socialist constraints in the late 1980s, are heading into a period of tight liquidity for projects and buyers.

"Even if a buyer can get a loan, you're looking at 80 per cent interest, so you're talking about cash buyers," said David Blackhall of VinaCapital, a property manager in Vietnam.

Although pessimistic about residential properties, Blackhall is still upbeat about Vietnam's office sector.

"There's a lot of Middle Eastern money that wants to spread into new emerging markets," Blackhall said. "Vietnam is seen as less difficult than China, and less complex and frustrating than India."

Unlike Vietnam, the Philippines' residential property sector is expected to continue growing despite the financial turmoil hitting developed countries.

Real estate developers are focusing on affordable housing and condominium projects to address the demand for the country's most active buyers, the millions of overseas Filipino workers, said Mike Mabutol, a director for CB Richard Ellis Philippines.

Mabutol is also optimistic about retirement villages, aiming at the US and European markets.

Thailand too has targeted the retirement and second-home market for foreigners, but there are worries that many of these potential investors have seen their buying power reduced with declining property values at home.

"The sector of the market that is dependent on mortgaging the family residence and using the difference to buy a property in a resort is going to be affected," said Simon Landy, managing director of Primo Company, a property agent in Thailand.

But even within this market there are exceptions, such as Scandinavians, who have proven major investors in Thai retirement homes.

"They are not so affected because they get government support to take off and die somewhere else," noted Landy.

In Indonesia, where the government is actively supporting the property sector, developers have joined with local banks to offer interest rate subsidies to buyers.

"With credit interest rates subsidy to consumers, it's expected to help improve buyer power and property market can be maintained," said Teguh Satria, chairman of the Indonesian Real Estate Association.

But property developers everywhere have been facing rising construction costs, which has provided yet another constraint on overbuilding.

"The real situation is that there won't be new projects in the near future for people to speculate on or to purchase, so what will happen is a contraction in the market and that is part of the correction process," said Simister. (dpa)