Slump In Expat Arrivals Hits Thai Condo Market

The soaring baht and a dearth of expat arrivals have hit hard on the country’s condominium market.

Real estate agents across Thailand are hunkering down and hoping to survive what one developer is calling the most severe situation in the past 10 years. Prices have slumped during 2019, mainly due to the continued rise in the baht and a strong fall in the numbers of Chinese and Western expats arriving to work or retire. Almost half a million residential condominiums both in Bangkok and other major cities were left unsold in 2018, representing a total value of $41 billion.

Historically, condo sales have relied on Chinese buyers as well as on expat professionals and retirees, but the numbers of Chinese arriving are now vastly reduced as a result of the slowing of the Chinese economy and its capital controls aimed at limiting currency outflows. The stock of unsold condominiums has also increased as expats decide to leave the country due to tightening visa finance rulings, the threat of compulsory private healthcare and a general feeling of being unwelcome. In addition, expat retirees on state pensions are finding it harder to cope with everyday living costs due to an unexpected rise in inflation.

In spite of the above, developers are still trumpeting expensive new schemes in the hope that wealthy overseas buyers will be tempted to purchase a holiday home in Thailand. New ideas include low-rise condo blocks aimed at employees of private companies receiving higher salaries than the norm. The issue isn’t just confined to Bangkok, and property sales in other popular destinations such a Pattaya, Phuket and Chiang Mai are also at all-time lows and are expected to decline further during the dry season.