Condos in Bangkok: what’s the likely near-term trend?
Now that Bangkok is gradually getting back into the swing of being Asia’s most popular city again, enquiries for real estate, especially condos, have continued to increase over the last week or so.
Bangkok is consistently voted as one of the cities in Asia which tourists would most like to visit. Indeed, the number of visitors, pre-Covid, had been at record levels. The city ranked 1st in Mastercard’s list of “Global Destination Cities Index 2019” with 22.78 million visitors, and this for the fourth consecutive year.
Bangkok condo buyers are from all over the world
The attractions of the city are well-known and a fair proportion of people who initially visit as tourists end up as potential buyers for a condo in the city. Visitors come from all over the globe with people from Europe, US and Australia featuring strongly. As an example, it is estimated that there are around 1 million visitors annually from the UK to Bangkok.
Yet, with over a 40% share of total visitors, the numbers of Chinese visitors to Bangkok dwarf the rest, and it was this market segment which has accounted for the bulk of foreign real estate purchases over the last few years. Condos being top of the list.
High-rise condo and office buildings
The condo market has distinct segments
Interestingly, there are some key differences in the types of properties and locations favoured by foreign purchasers, with broadly the distinctions being as follows:
▪ Chinese buyers: modern smaller condos, more than likely to be along the BTS or MRT lines; typical budget below Baht 5M; in this category are also Hong Kong and some Singapore buyers
▪ foreign buyers: more prepared to look at older condos in more central locations along Sukhumvit or the older city areas such as Silom or Saladaeng. Until recently many of these buyers had budgets around Baht 5-8M, often measuring the amount they were prepared to invest in US$ terms;
▪ the third category is the higher end buyer and such buyers, in the past, may have been foreign or Chinese, or often Indian. All looking for higher quality, better located condos with good amenities, and more likely located in the city areas.
Obviously, until international flights are being allowed back into Thailand, external foreign demand for condos is unlikely to pick up. Of course, there will be some foreigners who live in the city looking to trade up or move for other reasons. Yet, it does appear that there is a growing pent up demand from foreigners for Bangkok condos and it may be that once the airlift is available again, there will be a rush to acquire, certainly from buyers in the first two categories mentioned above.