Should You Invest?
There are currently quite limiting restrictions on foreign
ownership in Thailand, but with the need for foreign investment
into the country to help it achieve constant economic growth, the
restrictions are expected to be loosened in coming years. The
tourist industry in Thailand is growing annually because more
people are choosing the country as a holiday and residential
destination.
- Thailand is now a popular sophisticated tourist destination and
foreign investors are become increasingly interested in the
emerging property market.
- Thailand has a warm climate all year round making it a popular
retirement destination.
- Bangkok and other major cities have a good buy-to-let market
and they are currently experiencing high rental yields.
- Thailand has a pro-landlord rental market which is good for
investors wishing to rent out their property.
- The cost of living in Thailand is cheaper than that in European
countries.
- Although the property purchasing process is slightly
complicated in Thailand, the transaction costs are moderate for
both buyer and seller.
Rental Yields
Thailand's rental market is currently experiencing a boom
because of the increase in tourism. Major cities, especially
Bangkok are experiencing high rental yields of 5.66% - 10.15%, the
bigger the property the lower the rental yields, for example a 280
sq.m. apartment in the centre of Bangkok only reaches a rental
yield of 5.66%. Hua Hin has many beachfront villas which in peak
seasons can earn an investor good rental returns because it is in a
prime location outside the city.
location
type of
property |
size
(M2) |
average
price
to buy
(US$) |
cost per
m2 to buy
(US$) |
average
price
to rent
(US$) |
cost per
m2 to rent
(US$) |
yield
(%) |
Bangkok-
Apartments |
|
|
|
|
|
|
| |
40 |
95,135 |
2,378 |
804 |
20.1 |
10.15% |
| |
80 |
199,552 |
2,446 |
1,400 |
17.5 |
8.59% |
| |
120 |
299,022 |
2,492 |
1,986 |
16.6 |
7.97% |
| |
160 |
397,965 |
2,487 |
2,475 |
15.5 |
7.46% |
| |
200 |
463,688 |
2,318 |
2,698 |
13.4 |
6.98% |
| |
240 |
527,160 |
2,196 |
2,674 |
10.9 |
6.09% |
| |
280 |
650,678 |
2,324 |
3,069 |
10.5 |
5.66% |
| |
320 |
- |
- |
3,059 |
9.6 |
- |
Source:
Global Property Guide
Price History
Thailand's house prices saw their peak in 1992 until the country
was hit by the Asian financial crisis causing house prices to drop
dramatically. The Thai government used this opportunity to develop
parts of the country and reconstructions of developments were
completed in record time. In recent years the Thai economy has been
slowly recovering from the crisis but house prices are still 10%
below the 1992 peak. Investors who are turning their attention to
the Thai property market are amazed at how good value for money the
property is, but with increased interest property prices are
starting to rise quickly.
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