Foreign Buyers Flocking to Buy Condos in Thailand

In the first quarter of 2024, most condo buyers were from outside of Thailand. New projects were centered around popular tourist spots, and the total value of the investments made was over 56.6 billion baht.

Phattarachai Taweewong, head of the research department at real estate firm Colliers Thailand, told the Bangkok Post that more condos were launched in popular tourist spots than in Bangkok for the first time ever in the third quarter.

“We’ve never witnessed such a significant amount of new condo supply outside Bangkok before,” he noted. “The key driver behind this trend was demand from foreigners, particularly Chinese and Russians.”

Pattaya had the most apartment launches during the quarter, with 4,493 units worth 16 billion baht. After putting out 3,302 units last year, which is 132% more than in 2022, this happened. Most of these launches came from big projects by publicly traded companies like AssetWise and Origin Property.

Colliers thinks that most of the new condos that come on the market in the next three quarters will be made by local developers.

“The significant volume in the first quarter was to cater to robust demand, both for own use and investment purposes,” he told me. “Some Chinese and Russians even purchased entire blocks of new projects to lease them to fellow nationalities.”

New condos in Pattaya

Colliers thinks that there will be 7,000 new condos in Pattaya by the end of 2024. To be safe, though, Mr. Phattarachai said that the amount should be between 3,000 and 5,000 units per year.

“If exceeding this amount, the market will be in an oversupply situation again, as in 2013-14 when more than 10,000 units were launched annually,” he said. “The market at that time took several years to absorb the excess supply.”

The excess during those times had a big effect, as 27 projects with a total of about 9,000 units have stopped sales until now. Colliers keeps an eye on these projects to see if they will come back to the market.

After Pattaya, Phuket was the next place with a huge supply of new condos. There were 3,338 units in 12 projects, worth a total of 25 billion baht.

This number followed the record-breaking high of 8,743 units launched last year. This is more than six times as many as the previous high of 6,429 units in 2012, and it shows a growth of more than six times. By the end of 2024, 8,500 new condos should be on the market in Phuket.

Bangkok condo market

“In Phuket, condos that sold for 120,000 baht or more per square meter were very rare before the pandemic.” “Prices today are usually between 150,000 and 180,000 baht per square meter,” Mr. Phattarachai said.

As compared to the same time last year, Bangkok had 3,288 new condos built in the first quarter of 2024. This is the lowest number of condos built in the city in 15 years.

Another property expert at Colliers, Supasit Vitooraporn, said, “The Bangkok condo market has slowed down since the third quarter of 2023 because developers are being cautious.”

Mr. Supasit said that one of the main problems was the high rate of mortgage rejection, especially for homes priced at 3 million baht or less, where the rate was 70%.

Foreigners from China and Russia have bought the most condos in Thailand this year. Sales have been especially strong in Bangkok, Pattaya, and Phuket, which are popular tourist spots.

The Real Estate Information Center says that compared to the same time last year, 10,703 units worth 52.3 billion baht (US$1.5 billion) were sold in the nine months ending in September. The Government Housing Bank (GHB), which runs the center, said that’s a 38% increase from the previous year.

The center said that property registration data showed that Chinese buyers bought 4,991 units, which is almost 47% of all the deals and was worth 24.7 billion baht. With 962 units, Russian buyers came in a very distant second. The United States and Taiwan came in third and fourth, respectively.

Nearly 42% of the condos sold were in Chon Buri province, which has many beaches and modern industry areas. The center said that 37.5% of the apartment sales to foreigners happened in Bangkok, which is Thailand’s capital city and a popular vacation spot for millions of people.