Property News · February 2, 2017

Chinese are becoming investors first, tourists second in Thailand


That is, if Beijing’s capital controls don’t catch them first
Phuket, one of the most popular destinations for Chinese property investors in Thailand. Aleksandar Todorovic/Shutterstock
Chinese demand for real estate in Thailand is at an apogee, but the Beijing government’s drive to control capital flight could hinder such demand, according to a new report by Financial Times Confidential Research (FTCR).
Surveying 108 property investors, FTCR found that Chinese buyers, put off by skyrocketing values in the mainland, are scouring the kingdom for residential properties. More remarkably, these buyers are only “moderately wealthy.”
Thailand is the fifth most popular destination for real estate investment by the Chinese, FTCR reported. Chinese buyers account for 10 to 20 percent of total sales in the tourist hubs of Chiang Mai, Pattaya, and Phuket, and 5 percent of Bangkok sales.
In 2010, almost no Chinese were buying homes in the country, FTCR pointed out.
More: 5 reasons Thai construction is hot again
However, the greatest concentration of purchases by the Chinese is still in Greater Bangkok, with 29.3 percent of respondents currently owning a home in the Thai capital. Chiang Mai is next, with 21.8 percent of respondents reporting residential properties in the northern Thai city, followed by Phuket (17.3 percent) and the province in which Pattaya is located, Chonburi (15.8 percent).
A third of FTCR’s respondents reported an intention to purchase another Thai property within two years, despite signs that the Chinese government’s capital controls could remain in place indefinitely. Around 26.8 percent of respondents evinced a desire to buy in the next two years in Phuket, the most among all Thai destinations, followed by Chiang Mai (19.5 percent).
Most of the respondents are considered mid-market buyers. Sixty-three percent of them spent CNY1 million (USD145,386) for their homes, while 22 percent paid CNY500,000.
One Shanghai-based resident told FT that Thai real estate is more within his means, with reasonably high rental yields to boot. “(Thailand) is just like China in the 1980s: everything is waiting for a great boom,” he said.
FTCR allowed room for such foreign demand to recede. “The immediate outlook for Chinese investment flows into Thailand is negative,” FTCR stated in its report.
“In this new climate, we expect investors to delay plans to purchase more Thai real estate, at least until the dust settles, if not until the Chinese government loosens up again.”
Read next: Why luxury real estate in Thailand remains a solid investment

Source : property-report.com
Read more…Chinese are becoming investors first, tourists second in Thailand

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