Even with capital controls in place from the government, Chinese buyers continue to invest in Thai real estate due to its low prices and above average returns, reports local media. In addition to being cheaper, in some cases down payment rates and property transfer fees are lower in Thailand than in China.
Buyers from China tend to be from the middle class and like the fact that property in the Kingdom is cheaper and comes with less sales-purchase conditions. Investors who buy property and rent it out in Thailand are able to realise a return in roughly 20 years. This is significantly less than in Beijing and Shanghai where it can take more than 50 years to get a return on investment.
Chinese demand for Thai properties increased by 180 per cent in the 2nd quarter last year from the same period in 2015, according to Chinese overseas property website Juwai.com. Banks are helping buyers from China obtain financing for these properties.
“There are many Chinese banks facilitating Chinese buyers in many key destinations like Bangkok, Pattaya, Chiang Mai, Rayong, Phuket, Udon Thani and Ubon Ratchathani. They offer mortgage loans of up to 70 per cent per cent of property prices,” says Wason Khongchantr, Managing Director of Modern Property Consultants, to the Bangkok Post.
A majority of Chinese buyers want condo units priced between THB 5 and 10 million while there is also demand for units cheaper than this in some areas of Thailand. Prices in this range are significantly less than similar unit sizes and styles in Shanghai. This has seen Thailand become the most popular country for Chinese real estate investors in Asia.
“Thailand was ranked the 5th top country where Chinese looked for property to buy after US, Australia, Canada and New Zealand. Last year some purchased entire condo towers to either convert into hotels or resell to buyers in China,” says Wason.
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