Housing in Thailand continues to grow rapidly: market overview
The company Krungsri Research has conducted a market study in Thailand. According to the document, over the next two years in the six major provinces of the state one can expect a significant development and increase in the number of objects. Housing in Thailand will become more affordable, which became possible thanks to a systematic strategy of developers to reduce the cost of facilities. Such a breakthrough will be achieved through a reduction in the number of new projects and changes in the very structure of future constructions. Experts predict a real boom in the real estate market in areas such as Phuket, Chiang Mai, Khon Kaen, Rayong and others.
Developers are currently focused on the construction of more than 100 thousand housing units, while buyers are not in a hurry to buy apartments and houses. This situation will lead to the fact that this year the number of commissioned objects will be at the level of the previous period.
In addition to lower prices, developers are building low-rise buildings, which on the one hand will be more affordable for the purchase of local residents, and on the other – will be the best solution for people who work from home.
According to experts, the volume of new projects will decrease by about 35%. This is also evidenced by data from the Building Department, where permits were issued for the construction of real estate by almost 55% less than in 2021.
Overall, Thailand’s real estate market will show a slight slowdown this year, but it is possible that it will stabilize. Despite the country’s good economic recovery, the effects of the pandemic are still being felt and are reflected in the real estate segment. The economy is projected to show growth in the range of 3-4%, by comparison, in 2020 it fell by more than 6%.
Investments are increasing, with part of the investment going into infrastructure development in the Eastern Economic Corridor. This is driving growth in the Chonburi and Rayong regions, which are recovering faster than the rest of the country.
Thailand’s economy is dependent on tourism, and increased activity here is critical. Positive dynamics are already evident – the inflow of business tourists has increased, connections with the states, which were closed for a long time due to high levels of disease, have been restored. According to analysts, by 2024 the number of travelers should grow to 40 million people, which corresponds to the level of 2019.
After the pandemic, Thailand’s real estate market began to rebound from the third quarter of 2020. At that time, home values rose 5 percent, which exceeded the same period in 2019. The demand for apartment rentals also increased. The average monthly payment for a 120-square-meter apartment in Bangkok will cost $1,840. The yield of this facility is about 8% per annum.