Something that we have constantly mentioned was the strength of the Thai Baht. Many of our clients have purchased properties in Bangkok and sold them off and enjoyed not only capital appreciation but the appreciation against their home currency extrapolated their gains. An example would be an Indonesian client who purchased a property in Bangkok for 13.15 million Baht about a decade ago and sold it at 13.85 million Baht recently. Recent transactions in the development were transacting for about 10 per cent more than what he sold off the property for but he wanted a quick sale and thus marked down the asking and sold it in two weeks. He might have made 5 per cent in terms of price appreciation in terms of Baht but Baht had appreciated about 40 per cent against the Indonesian Rupiah and thus he made more than 50 per cent gains when he converted the Baht back into Indonesian Rupiah.
This is something which we have often advocated when looking to invest overseas. The fundamentals of a country do play a significant role in whether the investment will turn out well. Thailand’s fundamentals are strong and in comparison with countries in the region, it sticks out as a safe haven together with Singapore.
Here are two Business Times articles which may be useful for potential investors of Bangkok properties:
Here is an article which I wrote previously. In it, you can see the 10-year history of how the Thai Baht has appreciated. In fact, it is the best performing currency in South East Asia in the past decade.
I have always maintained that never has there been a period in history whereby you have 1.4 billion people getting wealthier by the day. China’s growth and influence in the region are staggering and the Chinese are taking over the Japanese as major investors in Bangkok. Even though the supply of properties is high, the demand from the Chinese is correspondingly high. Of course, there are potential risks to regional growth especially with the trade war and a slowing Chinese economy. These risks are not bestowed on Bangkok alone but to the whole world.
Even though we are positive about the Bangkok property market, we do see a lot of developers launching projects in rather obscure locations. For this reason, we encourage buyers to always look for prime locations and purchase from a reputable developer.