Thailand’s property market waits for an end to Covid-19
The Coronavirus outbreak poses challenges for Thailand’s property market as potential Chinese condominium buyers remain stranded in China. Meanwhile, some believe that the outbreak may bring opportunities for non-Chinese buyers and in the long-run, the Chinese may be looking for an overseas refuge in the event of these types of emergencies popping up again
Through all this, there will be a certain level of pent up demand for Thai real estate.
Of course, it’s not just the Chinese unable to come and inspect potential buys, the rest of the world is also mostly shut out of Thailand.
Market remains weak
The pandemic is hurting the condominium market as Chinese nationals were accounting for half of the international buyers in Thailand, or 57.6% of the total foreign condo owners in 2018.
Vichai Viratkapan, acting director-general of the Real Estate Information Centre says that 50% of Chinese condo transfers are expected to disappear in the first 2 quarters of this year and the total transfer value by the Chinese will miss the mark of the usual 29 billion baht by about 25% (around 7 billion).
However, since Chinese property buyers only make up 6% of the total international and domestic housing transfers in Thailand, the proportion of total housing transfers in the country is likely to be similar to last year.
Developers looking to sell current stock whilst shelving new projects
CBRE reports that most Thai developers are postponing the launch of new condo projects to focus on clearing existing stock.
“Discounting completed projects to generate quick revenue as a financial lifeboat is the best solution for many of the country’s larger developers whilst the market is in limbo.”
Rathawat Kuvijitrsuwan, head of CBRE Research and Consulting in Thailand believes that, now business is gradually recovering, a few developers have started to launch new condominium projects.
“In the first half of 2020, the Bangkok condominium landscape was gloomy with fewer than 10,000 condominium units launched, which was much lower than the total number of new launches in the past three years of more than 60,000 condominium units per year.”
The Chinese are reluctant to complete transfers