According to real estate appraisal and consultancy agencies, the growth in Thailand’s property market during the second half of this year will be driven by foreign buyers, while domestic buyers have not fully regained their purchasing power due to unfavorable factors. The country’s economy has shown signs of improvement, thanks to foreign purchasing power, especially since the reopening of China and the resurgence of the tourism sector and selected businesses. The Ministry of Finance’s Fiscal Policy Office predicts that Thailand will welcome 29.5 million tourists in 2023, generating 1.3 trillion baht in revenue. However, growth in the property sector is hindered by rising interest rates, inflation, and political uncertainties.

According to the Real Estate Information Center (REIC) of the Government Housing Bank, the number of condominium transfers by foreigners across the country increased by 79.2% to 3,775 units, and the value of these transfers rose by 67.6% in the first quarter of 2023 compared to the same period last year. Total transfers at the end of the first quarter amounted to 17.1 billion baht. This indicates a positive recovery trend in the real estate market following the reopening of the country, allowing foreigners to travel and engage in property transactions and transfers as before.

Artitaya Kasemlawan, head of resident sales for real estate service and investment firm CBRE (Thailand), stated that 89% of customers from last year until the beginning of this year were Thai, while the remaining 11% were foreigners, mostly from China, Hong Kong, Taiwan, Myanmar, Singapore, and Japan. The agency has observed a healthy growth in foreign buyers since the beginning of this year.

She further mentioned that foreign buyers in the condominium sector typically have higher budgets compared to Thai buyers, ranging from 15 to 30 million baht per unit. In Bangkok, they prefer to reside in main business districts such as Sathorn, Lumpini, and Sukhumvit, as well as along the banks of the Chao Phraya River.

Sopon Pornchockchai, president of the Agency for Real Estate Affairs (AREA), predicts that foreign buyers will account for 15% of the total property value or approximately 10% of total units transferred, and these numbers will increase to about 18% of total units sold in the next two years.

AREA forecasts that 111,273 property units will enter the market this year, representing a 5.3% increase compared to last year. The value of property units in 2023 will amount to 478.61 billion baht, a 6% increase from 2022.

Sopon also highlighted that only 60% of total purchases are for actual residential purposes, while 22% are speculative investments by Thai investors, and the remaining 18% are purchases made by foreigners for both residential and investment purposes.

He cautioned that if speculative investments continue to rise and the proportion of genuine buyers decreases, it may eventually lead to market problems and a decline in property prices.