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Baht’s strength dulls foreign interest in homes under Bt10m

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Baht’s strength dulls foreign interest in homes under Bt10m

By Somluck Srimalee

The Nation



Photo by Pruksa Real Estate Plc


The baht’s appreciation against the yuan and dollar will have a direct impact on demand for residential units for the rest of the year, say property developers.


“Demand from overseas investors for residential units priced under Bt10 million has been dropping since the second quarter, and the baht has appreciated 8.07 per cent against the yuan, from Bt5 per yuan to Bt4.35 in August this year, while rising against the dollar by 5 per cent,” Prasert Taedullayasatit, chief executive at Pruksa Real Estate Plc, told The Nation recently.




He said residential prices had risen an average of 8 per cent in yuan terms and 5 per cent in dollar terms, curbing demand among foreign buyers for units under Bt10 million.


But demand for luxury residences above that price is still growing, Prasert said, thanks to foreign investors looking for second homes in Thailand, particularly Hong Kong people wanting luxury condominiums in Bangkok amid the current political unrest in the Chinese territory.




“We were successful with sales of our new luxury condominium, Chapter Charoennakorn-Riverside, last week, with 10 per cent of the units booked by Hong Kong customers,” he said.


Prayongyut Itthiratchai, first vice president at SC Asset Corp Plc, said 9 per cent of buyers for its 28 Chidlom luxury condo were foreigners overseas, and half of them Hong Kong people looking for a second home in Thailand.


The 28 Chidlom condo was unveiled in 2017, asking foreign buyers for down payments of up to 20 per cent, he said.


Prayongyut concurred that foreigners’ purchasing power had dropped due to the baht’s appreciation and said his company had to revise its residential business strategy to focus on domestic rather than overseas demand.


An Agency for Real Estate Affairs survey found that overseas demand for Thai homes dropped in terms of volume from last year’s average of 20 per cent to 14 per cent in the first half of this year. 


In terms of value, the decline was from 25 to 19 per cent.


Source: https://www.nationthailand.com/property/30375822



-- © Copyright The Nation Thailand 2019-09-05
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2 hours ago, donnacha said:

Also that report this week of a retiree's renewal being refused because the owner of the condo he rented was Chinese, rendering the rental illegal because the owner was not permitted to work in Thailand. Hopefully just a one-off bizarre decision but if it in any way represents the start of a fad to exclude foreign landlords it will pour cold water on the entire market.


Rule #1, don't rent from chinese.


1 hour ago, the guest said:

Thaiand following the steps as the Chinese as currency manipulators. 


Don't expect foreigners to come to Thailand when there are equally many other places for cheaper.


Not just cheaper (and even if it was more expensive) but a much better experience.



1 hour ago, SoilSpoil said:

Why would I buy a condo, 10% more expensive than last year, in a country where I have to report my every move to the police? 

Maybe a good time to sell my condo and buy foreign currencies.


I agree.  With the vast amount of rentals available, the sketchy economy and unstable government, why buy in this country?  


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first thought real obvious.  unless it is where you live, not an investment at any price.

even for homes over 10 million THB, as another "strength" may dull interest in real property but not just for foreigners either.  beginning real soon.  2020?  well, real property ahead of stocks as well as bonds obviously, especially bonds..... that are now bid at negative rates for the first time in 243 years such as the 30 year Treasury.  next?  they say maybe 10 years, but the narrative is a little different from the one some of us know about.  including some folks with $12 trillion US dollars in those negatively rate bid and held bonds:  a "possible recession next year" is what we are told..  yeah right.

"strength" as in positive over negative atmospheric forcings that.... we have to put this in politically correct language.... have an influence on the discount rate used to price those thangs.  using some accounting tongue twisters but if you think about for a few secs it makes sense to just about anyone.  unless you don't get simple physics.  not even the kind [Einstein stuff] that allows cell phones to work.  simple physics [even before the great Albert Einstein who had Asperger's Syndrome, just like Greta Thunberg has, so they say].

that's what the tea leaves seem to maybe say.  maybe.  but if you believe I also have Asperger's, that may or may not help you out.  if you are not prepared at all.  and we all need to be.   yeah yeah.  maybe.  I get that too.  but do you?   

Edited by WeekendRaider
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4 hours ago, mok199 said:

And yet they keep building......when will Thailand ''throw in the towel''...

Never; they have to keep laundering all that illicit cash and building is the way to do it !

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Why would Hong Kong people want to buy here as an escape valve?!  Other countries will give them permanent residency status for investments of ~20M ฿, with minimal hassle.  Thailand gives them a tourist visa...


Overall, I wouldn’t worry too much for developers nearing completion of the building shell, but boy, breaking ground today seems high risk in most areas of BKK.


Will also be interesting if there is any form of crackdown on Chinese vacation rental units like there has been on some of the western apps.

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