Thailand Condominium Market Slumps as Chinese and Russian Buyers Withdraw

Thailand Condo Market Slumps

Thailand: Thailand's condominium sales are experiencing a downturn following a surge driven by foreign buyers from China, Russia, and elsewhere. In the April-June quarter, condos bought by foreign buyers dropped 6% year-on-year to 3,342 units, with a corresponding 18% decline in value to 14.8 billion baht ($449 million), according to the Real Estate Information Center under Thailand's Government Housing Bank. Purchases by Chinese nationals fell 17%, while Russian purchases decreased by 19%.

Chinese buyers, who previously accounted for over half of foreign purchases, are now retreating as China's economy slows and restrictions on fund transfers for overseas purchases tighten. New condo supply in the Bangkok area also fell sharply, down 44% to 8,674 units in the first half of the year, according to Colliers.

Meanwhile, sales to Thai buyers are faltering due to rising household debt, which reached 91% of GDP as of March. Despite maintaining the policy interest rate at 2.5% to curb credit, no solutions to the debt issue appear imminent. Lenders are increasingly scrutinizing borrowers, leading to loan rejection rates of 40% to 50%. Japanese developers, who have partnered with Thai firms, continue to supply affordable suburban units but face challenges in selling these properties.

Source – Nikkei Asia