Real estate firm concerned about foreign buyers

Real estate firm
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Real estate agencies sell property so when one publishes research that raises questions about the strength of the market you need to take notice.

One Bangkok real estate firm, in its latest residential market report, has raised some significant questions about the future of the Bangkok property market, and especially regarding the actions of foreign buyers.

CBRE Thailand, in its MarketView report published today, noted the increasing number of Bangkok condominium sales to foreign buyers, especially Chinese buyers, during the second quarter.

It also reported that several projects have reached the foreign ownership quota – equal to 49 percent of sellable space – even prior to official launches.

ThailandProperty.News suspects these are “sales” to overseas real estate agencies who have guaranteed they will achieve a certain number of transactions.

For Bangkok condo market watchers, what CBRE said next is worth noting.

“The big question remains – will these foreign buyers transfer title of their purchased units, and who will live in them once construction finishes.”

The real estate firm said that most foreign buyers of Bangkok condos are investors, and it doubts they will live in the units they have purchased.

“The downtown expatriate rental market is not growing and the local rental market in the midtown/suburban areas is also quite flat.”

CBRE admitted the number of Thais paying more than THB 10,000 per month rental is minimal, and that the downtown rental market relies on demand from expatriates.

A lack of growth in expat rental demand combined with increasing supply means there will be little opportunity for rental growth, the real estate firm predicted.

With extensive experience of reporting Thailand’s property sector for more than 10 years, we believe CBRE is one of the more realistic agencies in terms of its research and reporting.

Andrew Batt
The author of this article is Andrew Batt, the founder and editor of Andrew has been writing about property and real estate issues in Thailand and Southeast Asia for more than 10 years. He has worked for PropertyGuru Group, DDproperty, Dot Property Group, Hipflat and AsiaRents. He has also produced content for leading Thailand property developers and real estate agencies.

1 Comment

  1. I think the rental options will be very limited and the condominium market will crash. Many owners and developers built or bought condominiums as an investment and were expecting high returns on daily rentals. The Condominium Act and the Hotel Act have closed this market with condominiums only allowed for rental periods over 30 days. I think many investors will have no interest in the small return on minimum monthly leases and look to dump unwanted condominiums. Obviously developers will have problems selling units and all related business will suffer. Construction workers, developers, building suppy outlets, land sales etc…All really due to the laws surrounding short term rentals. Unfortunately with a reported 40 million visitors and so few hotels with a licence these regulations will soon start to affect visitors to Thailand too.

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