Coronavirus outbreak shaking up real estate market in Thailand

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The prolonging of the crisis into this month has shaken up the Thai real estate market since Chinese customers were the main target group for property developers. PUBLIC DOMAIN

The real estate market in Thailand has become lethargic since the outbreak of the new coronavirus in China, taking a toll on the purchasing powers of Thais and Chinese buyers, industry experts said.

Property businesses were banking on the Chinese government successfully containing the epidemic in February or March and had hoped closing the country would not be an option.

However, the prolonging of the crisis into this month has shaken up the Thai real estate market since Chinese customers were the main target group for property developers.

Apa Ataboonwongse, CEO of Richy Place 2002 Pcl and president of Thai Condominium Association, said members need to focus on Thai customers whose real demand is more than before. They should launch promotions in coordination with the government’s support measures including transaction fee reduction and lessening the strictness of the loan-to-value stipulation.

Besides, the government has to extend the measures for the long term, seek more measures to help the real estate sector and propose new tax measures to stimulate the business to help the entrepreneurs move forward.

Although the baht has become weaker, the Bank of Thailand still has to invest 20 billion baht ($640,000) to keep the baht at 32 to the US dollar.

Meanwhile, entrepreneurs also have to resolve the situation by themselves by slowing down the launch of new condominium projects and looking for new markets, targeting Thai customers, focusing on low-rise development projects and keeping cash in hand.

However, a good project location – such as near BTS Skytrain stations in Bangkok – could potentially lead to 10 per cent of customers being Chinese, down from 20 per cent at the beginning of this year, Apa said.

In the future, there is a possibility that China may close itself off entirely, reducing the number of Chinese customers in Thailand to zero, she said.

Phoenix Property Development and Consultancy Co Ltd managing director Surachet Kongcheep said the solution would be to depend on national customers.

He said the most affected districts are Rama IX, Ratchadaphisek, Huai Khwang and Ramkhamhaeng where Chinese people live in Thailand.

THE NATION (THAILAND)/ASIA NEWS NETWORK