The property market in Pattaya has gone through many changes over the years, with many notable ups and downs. One thing has remained the same, however: it is one of the most sought-out locations in Thailand for holidaymakers and expatriates alike.
It is due to the gorgeous beachside location, colourful nightlife, and the convenience of being so close to the capital city of Bangkok. Still, despite its popularity, the property market in Pattaya has always been somewhat shaky.
The current global pandemic has taken the world by storm, yet another spanner thrown in the works. Businesses all over the world are to close, people are losing money on property and investments, and everyone is worried about what the future has in store. But what does that mean for the property market in Pattaya?
In this article, we’ll look at the market in Pattaya both before the COVID-19 crisis and look at how this pandemic may affect it over the coming months. Of course, for the sake of continuity, let’s start with the ‘before’.
The Pattaya Property Market Before COVID-19
More recently, the market in Pattaya was making a recovery in 2018. It was a great year indeed but eventually suffered yet another hit in 2019. It is due to several factors:
- Thai Baht gained 10% in strength when compared to all major currencies, subsequently resulting in less foreign investment and increases in property owners wanting to sell assets at good profits. For more detail on the rising baht during that time, read here.
- New Clientele: Less Farang (Western Foreigners) primarily due to the previous point and immigration changes for Retirees in Thailand. More Chinese who were severely impacted by the US-China trade war (more so than other nationalities), and the restrictions on money transfer possibilities.
- Loan policies are tightening for Thai nationals, with lending criteria changing out of concern about the potential risk of rising household debt in Thailand.
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The Aftermath of 2019’s Decline
As the market suffered, there was a significant blowback. It transpired in the form of having too many products on the market. There are 450,000 properties across Thailand, as well as 100k in Bangkok, and 30k in Pattaya. That is an awful lot of money!
The rise in prices began to slow and managed to level out for a while; however, land & house prices in Bangkok continue to rise.
How Pattaya was Affected Specifically
Pattaya has long been a popular city amongst those looking to retire in paradise. It has slowed, however, as the government is continuing to create difficulties with retirement visas and compelled insurance issues.
Another huge factor in all of this is the loss of tourism during Pattaya’s high season. Although the city remains vastly popular, there is an awful lot of competition with other neighbouring “up-and-coming” countries where accessibility & expatriation is being made more comfortable.
The Pattaya Property Market at the Approach & Turn of 2020
Despite the recent difficulties, the property market in Pattaya was slowly showing signs of recovery once more. These positive signs included:
- Improvements in currency exchange rates as the US-China trade war began to loosen.
- An increase in foreign investment due to the Eastern Economic Corridor (EEC), something we discussed previously here.
- Improvements to core infrastructure in Pattaya and at the time, firm oil prices led to a significant presence of workers in the oil and gas industry in the region.
- Pattaya Prestige Properties began receiving a noticeable increase in enquiries for high-end properties. Indicative of more asset liquidity and a desire to invest in countries with steady currencies.
The First Wave of Corona Virus & It’s Impact on Pattaya
Picking up on the trend here, the signs of recovery were subsequently short-lived, as of the 23rd of January when Wuhan shut down due to the viral outbreak that has since spread across the globe like wildfire.
It has had a profound impact not just on Pattaya, but the rest of the world as well. However, as of the 25th, China stopped all Chinese tour groups and flights. Then, we all know what happened next (and is continuing even as you read this), thousands upon thousands of poor souls have lost their lives as a result of the virus. International flights have stopped, people asked to remain at home and practice safe social distancing, the stock markets have been crashing, and we are now entering an unprecedented era.
What Does This Mean for Real Estate Agencies in Pattaya?
New clients are unable to come due to flight restrictions. Besides, many people who were planning to move have decided to stay in their home countries with their families.
Also, many people have lost a lot of money in stocks and investments and are currently not looking to make any other investments during these uncertain times. Most people have decided (and understandably so) to wait and see how things pan out over the coming months.
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Rental Prices are Low & There are Plenty of Properties for Sale
The increase in demand for long-term tenants, there has been a significant reduction in the cost to rent in Pattaya, as a result of many people fleeing the country, and landlords losing a lot of business.
It is terrible news for many, but great news for those who may be looking to move to Pattaya. For example, if you are an expat living in Bangkok and would like to ride out the storm somewhere safer like Pattaya (less congested), then you will be able to find your dream property for an exceptionally low price.
That, and for those who are confident the property market in Pattaya will eventually bounce back (it always does), then there’s never been a better time to snatch up some prime real estate than right now.
Naturally, it is wise to exercise a little caution; however, the adage that “fortune favours the bold” is still as relevant today as it ever was.
How Can We Be Sure That the Property Market Will Bounce Back?
Well, if history can tell us anything, it’s that the Pattaya property market always does bounce back. Another significant indication is the fact that tourism will eventually resume as soon as it is safe to do so. And, what is it that most people stuck at home on lockdown are craving the most right now? Adventure! They want to get outside and dig their toes into the sand, and sunbathe, and party, and explore, and have fun. Pattaya is the perfect place to do all of those things, so it is safe to say that this is the eventual outcome.
In any case, we must stay safe and remain positive during these positive times. We will all get through this together.