Chinese customers are prepared to seize “better value” Thailand real estate for investment and retirement as bilateral travel is once again possible.
According to data from Trip.com, reservations for flights to Thailand from China increased by 67% in February compared to the previous month.
According to Thailand’s tourism board, it received 161,540 Chinese visitors between January 1 and February 15 and anticipates that total for the entire year will be about 5 million.
Eri Chen, a native of Shanghai, will travel to Bangkok and Chiang Mai in mid-March to look for homes to invest in and possibly retire to as soon as flights between China and Thailand are resumed.
His consideration of retirement in Thailand as a result of rising housing costs and living expenses in Shanghai, the commercial center of China. Chen finds a residence in downtown Bangkok for about 600,000 yuan far more enticing than paying at least 4 million yuan (US$574,000) just to live there, or double that amount for an average unit in the city’s metropolitan districts. Also, investing in real estate in Thailand might result in favorable outcomes.
Chen would not disclose his age but claimed to be nearing retirement.
“Investing in real estate in Bangkok is undoubtedly a better deal than in other cities,” he continues. “I also want to discover if Chiang Mai is really as wonderful a destination as people say it is for retirement.”
For the first time in three years, large numbers of Chinese visitors visit Thai beaches. Chinese travelers have traditionally favored Thailand as a travel destination; according to data from Trip.com, flight bookings increased by 67% in February compared to the previous month. In fact, online searches for flights from China to Thailand increased by 176% shortly after China dropped its Covid-19 control measures in late December.
Thailand is also making an effort to attract more Chinese visitors. It is one of the first nations to anticipate an influx of returning Chinese visitors because it is providing 30-day visas on arrival to bearers of Chinese passports until the end of March.
The nation’s tourism bureau reported that it had 161,540 Chinese visitors between January 1 and February 15, and that it anticipates that figure to rise to 300,000 during the first quarter of this year and to 5 million for the entire year.
While Chinese tourists are eager to return to Thailand, some, like Chen, have more ambitious aspirations. Chinese real estate companies have also upped their game and are organizing group trips for property viewings in Bangkok this month after spotting an opportunity.
Taking 20 investors to Thailand at once, Uoolu, a Beijing-based foreign property consultancy, organized a three-day tour on Friday and will do it again on March 24. The company charges upwards of 2,599 yuan, not including airfare. The four residential projects the investors will see include one in Bangkok near the Impact stadium, where residences for sale will be finished in July. The apartments have a starting price of 230,000 yuan and a 5.5% possible rental yield. In between viewings, the investors will go shopping just like other tourists.
Another organization is organizing a six-day vacation that will include stops at tourist hotspots and property tours. It is charging 2,588 yuan for the tour and mostly promotes Bangkok apartments with prices under 1 million yuan.
Chinese buyers are increasingly asking about properties in Thailand, especially since January, according to those who work directly with them, according to Clark Zhou, a sales director at real estate consultancy Juwai IQI located in Shanghai. Before the Portuguese residence program is eliminated on March 4, 2023, Hongkongers race to obtain permits.
Many of my clients have previously visited Thailand for vacation, and their positive experiences there have inspired them to consider investing in real estate there, he said. “As more people travel there for vacations, I think the market for Thai real estate will increase.”
According to Juwai IQI, based on the volume of queries, Thailand was a top choice for Chinese purchasers seeking for property abroad between 2018 and 2021. Only in 2022 did it fall to fourth place, behind Australia, Canada, and the United States. According to Zhou, this is because more investors were considering relocating to these nations last year.
Chinese consumers also favor purchasing from the United Kingdom, Japan, and nations in Southeast Asia including Vietnam and Malaysia.
According to Karlo Pobre, the deputy managing director of consultant services at Colliers Thailand, favorable conditions have been luring Chinese purchasers to real estate in Thailand. In comparison to other nearby markets, “price and investment rates remain very competitive, especially for condominiums in Bangkok,” he added, noting that 49% of the units can be owned by foreigners and that the paperwork is simple.
According to data from Thailand’s Real Estate Information Center, the Chinese have been the largest foreign group purchasing condominiums in Thailand since 2018. They are followed by buyers from Russia, the US, the UK, and Germany.
According to the center, Chinese purchasers purchased 3,562 units during the first nine months of 2022 for a total of 17.94 billion baht (US$511 million), or 49% of the total number of units transferred to foreign buyers. It also stated that apartments purchased by Chinese buyers cost 5 million Thai Baht and had an average square footage of 39 square meters.
According to Waras Dechgitvigrom, senior manager of research at Colliers Thailand, Chinese nationals bought condominiums in Bangkok in the early months of this year for between 5 and 10 million baht in areas near Rama 9 and Ratchada.
We further predict that Chinese buyers will start looking at prime locations in Thailand including Pattaya, Phuket, and Chiang Mai in addition to Bangkok real estate.
Yet, Waras predicted that the recovery of demand would take some time. However, he added, “the purchase numbers may remain at below pre-pandemic levels at least in the near term.” He also noted that the number of Chinese buyers recently is still low when compared to pre-pandemic times.
In contrast to the previous two to three years, however, “a build-up is likely in the coming months, and we predict the number will rise to a new high.”