The unlikely prospect of the Thai government imposing legal restrictions for Thailand overseas buyers of property and real estate will lead to more foreign buyers in the coming years.
That’s the conclusion of a report from Chinese portal Juwai.com which looked at current restrictions on overseas property buyers that are currently popular with mainland Chinese nationals.
And rather than imposing restrictions, Thailand’s government could earn significant revenues by loosening the few restrictions that are currently in place.
The report highlighted that Canada’s two largest provinces, six of Australia’s eight states and territories, and Australia’s national government have all increased the taxes or restrictions that apply to foreign buyers during the past two years.
In contrast, in the year ahead, only New Zealand looks likely to impose new policies targeting foreign buyers.
Carrie Law, the Chief Executive Officer and Director of Juwai.com, said: “The rapid upward trend in Chinese international property investment of the past decade hit the world at the same time as historically low interest rates and population growth were inflating values in popular destination cities.”
“In some places, especially Canada, Australia, and New Zealand, Chinese buyers were blamed for the price increases that objective data suggested was actually due to other factors.”
“After retreating from an exuberant peak in 2016 of US$ 101.1 billion, Chinese international real estate investment again appears to be on a growth path, although more steadily and restrained that what we saw in that golden year.”
Law added that the Chinese government seems comfortable with what it calls ‘rational’ growth in international investment.
“Beijing has already signaled that it may experiment with further loosening capital controls. China has already resumed two key outbound schemes for investment in overseas securities, which had been suspended to reduce capital outflows.”
“These have no direct impact on foreign property buyers but do reveal a change of direction – from tightening to loosening.”
Talking specifically about Thailand property and real estate, she said: “New restrictions on foreign home buying do not appear likely.“
“Weak economic growth and the desire to tap overseas investors for the massive Eastern Economic Corridor project play role.”
“Thai nationals are already protected by rules that prevent non-Thai overseas buyers from owning land and more than 49 percent of the sellable space in residential buildings.”
She added that, right now, the most popular destinations for Chinese property buyers in Thailand are Bangkok, Pattaya, Chiang Mai, Phuket and Ko Samui.
What is true for Chinese buyers is also true for other overseas buyers.
Property investment will follow the path of least resistance, it always has and it always will.
While Thailand is certainly not the easiest place to buy property as a foreigner, it’s certainly far from being a challenging destination for overseas buyers.