Property investment in Thailand has long been an enigma to many people. Most shy away due to complications with property ownership for foreigners although it is possible and, in many cases, profitable. Then, of course, there’s the political climate which is forever on the move and continually affecting people’s desire to buy. However, one thing has remained constant throughout it all, over the years: Thailand is a desirable location with great opportunities. But what’s in store for 2020?
For the moment, the property market in Thailand has been cooling down somewhat. However, for those who are investing in large apartments in houses, could still be rewarded handsomely as prices have been on the rise.
- Single-detached houses – have seen a 3.1% rise
- Condominiums – rose 1%
- Townhouses – experienced a handsome 7.3%
- Land prices – a comfortable 3%
As such, demand has risen; however, this is at a much slower pace than in recent years. This doesn’t mean that buying a condo in Pattaya, for example, would be a poor investment. Especially since Thailand’s figures are very much influenced by the Bangkok market figures and Pattaya has seen a rise in this quieter time. This trend makes Pattaya an excellent investment in times where Thailand’s growth is slowing. Be it as an investment or for those looking to start a new life in Thailand, then Pattaya real estate is a prime market, being such a desirable location with many attractions and amenities.
Amazing value for money with this huge mansion featuring five bedrooms on a large plot of land in developing East Pattaya
Property demand in Thailand is expected to weaken in 2020
Based on the figures that we have seen, while prices have risen slightly, they’ve slowed down compared to recent growth in previous years. Thus, property demand is expected to weaken in 2020 and beyond. Now, it is important to remember that property growth does not correlate with prices; that’s to say that the market remains very viable. Again, if you want to live in Thailand and permanently relocate, then you shouldn’t worry too much. All one can do is wait and see as things progress.
Investing in land has always proved to be wise and rewarding: here an ideal plot for a housing development
Larger apartments have yielded more in recent years
Large apartments (circa 120 sqm) have risen significantly, particularly in terms of rental yields (some 7%). Whereas smaller apartments are sitting around the 5% mark. In most other countries’ major cities, this would be reversed. Thailand is unique at the moment in that most people who are buying or renting are indeed going for the higher-end product.
This could have much to do with the government cracking down on immigration, whilst offering attractive visa packages for academic’s in specialist areas such as tech, who will generally have a higher monthly budget to your average ex-pat or retiree. Whilst this is merely speculative, the numbers certainly support the notion.
Buying this 224 sqm two bedroom condominium at a bargain price close to Walking Street will enable strong yield
Interest rates are on the rise for Pattaya real estate
Another thing that may be affecting the property market is the rise in mortgage lenders interest rates. In fact, in 2018, Thailand’s mortgage market grew to about 18% of GDP. So, while low-interest rates attracted many investors and boosted property demand in recent years, the rise in .25% to 2% has slowed it down.
Again, for those buying outright and who don’t need financial support, this hasn’t seemed to affect them (hence the rise in large apartments and investments). However, the lower end has undoubtedly begun to drop.
Pattaya properties: Foreign ownership and rules
Over the last few years, the Thai government have introduced several different options to make it easier for foreigners to access the Thai property market. While this has attracted many, there are still those who believe that it’s too complicated or only not worth the effort.
For example, a foreigner can buy an entire building, only not the land that it rests upon. One can explore a 30-year renewable lease, though there are drawbacks that come with it. For example, the lessee is unable to sublease, sell or transfer their interests. This option is certainly viable, however, if you are retiring (as you may not need to worry about a lease renewal). That said, this makes things complicated when it comes to including your assets in a will.
We appreciate how overwhelming it can be, but if you need any advice or information at all, please do not hesitate to contact us. In addition to selling the most exceptional properties in Pattaya, we also offer excellent legal advice. We will gladly guide you through the investment process to ensure that you make the best decision for you.
Other options include:
- Purchasing a condo at 49% ownership
- Buying land or property through a Thai company or entity (though again, only 49% ownership can be obtained)
In any case, you will need expert advice on how to proceed, but there are ways of getting on the property ladder and enjoying your slice of privacy in paradise.
Is it worth investing in Pattaya real estate?
Ultimately, yes. If you’re looking to turn a big profit, then choosing the right project is of the utmost importance. However, if you want to buy a home in one of the most sought-after locations in the world, then make sure to contact Pattaya Prestige Properties to help make the right choice for you. If you’re not sure and you’d like more advice then again, we are more than happy to help where we can.