The DDproperty Thailand Property Market Report highlights the positive impact of the easing of COVID-19 restrictions and the return of Thailand’s tourism on the Bangkok real estate market, particularly in the rental of residential property.
As travel restrictions are lifted and businesses resume operations, there is a growing demand for rental properties. Individuals and families-whether visiting temporarily or relocating to Bangkok are in need of housing accommodations, leading to an increased demand for rental properties.
The recovery of Thailand’s tourism sector has played a significant role in driving this demand. The country has seen a rise in the number of domestic and international visitors flocking to popular destinations like Bangkok. These visitors often require temporary housing options, making rental properties highly sought-after. This has contributed to the overall growth of the rental property sector.
Bangkok’s residential properties for rent
The rental prices of residential properties in Bangkok have experienced an overall increase of 3% compared to both the previous quarter and the same quarter of the previous year. However, the rental price increase for townhouses by 2%.
Notably, certain locations near the Skytrain, subway, and commercial areas in Bangkok have witnessed even higher rental price growth. Both Thon Buri and Samphanthawong saw a significant increase of 8% quarter on quarter (QoQ), followed by Din Daeng, which experienced a 7% QoQ increase.
Condo for rent
Condo for Rent in Thon Buri, Bangkok
Meanwhile, Sai Mai and Prawet both saw a 5% QoQ increase. The higher rental prices observed in these areas suggest a strong demand for rental properties near crucial transportation routes and commercial hubs. Investors may want to target such properties so they can benefit from higher rental income.
The rental market in Bangkok is predominantly composed of condominiums, which make up a significant 93% of the available rental properties. This indicates that condominiums are the most common type of residential property that people rent in the city.
What’s more, the rental prices of condominiums in Bangkok generally fall within the range of THB 10,000 to 30,000.
The rental residential property market has become and will continue to be an attractive investment opportunity for landlords and property owners. These properties will enable them to generate consistent rental income and potentially benefit from capital appreciation over time.
Bangkok’s residential properties for sale
The overall prices of residential properties in Bangkok have decreased by 10% compared to the previous quarter and 18% compared to the same quarter last year. This means that, on average, properties in Bangkok have become more affordable for potential buyers.
However, not all areas in Bangkok have experienced the same price decline. Central business districts and areas with good access to mass transit routes, such as the green line, golden line, and blue line, recorded the highest price index growth in the latest quarter. This indicates that the value of these properties has gone up, despite the overall market decline.
Condo for Sale
Find condominiums near the BTS Sukhumvit line
Investors may want to focus on properties in these specific areas in Bangkok because these have shown resilience and growth potential, even when the overall market was going down.
Based on the DDproperty listings, the supply of residential properties in Bangkok is mainly condominiums, accounting for 74% of the market. Single-detached houses make up 15% of the supply, followed by townhouses at 11%.
However, it’s worth noting that there has been a 6% decrease in the number of condominium listings compared to the previous quarter. On the other hand, both single-detached houses and townhouses have seen a 3% increase in listings during the same period.
The increasing supply of single-detached houses and townhouses could indicate that more and more buyers are looking for these types of properties, making these potentially worthwhile investments.
In Bangkok, the sales of residential properties have remained low because potential buyers currently have low purchasing power, forcing them to postpone or forego their plans of buying a residential property.
Moreover, buyers are hesitant to commit to property purchases at the moment due to economic uncertainties. They are anticipating higher inflation and interest rates, so they are worried about the potential increase in mortgage payments and property maintenance expenses.
Therefore, they are likely waiting for more stable economic conditions or better financing options before making a purchase.
Despite the current low sales activity, there are no signs of an oversupply of properties in the market. This means that the available properties are still in line with the current demand, so investing in these may still be worthwhile.
The selling price of residential property in Bangkok is expected to increase in the second half of 2023. This projection is based on the rising Demand Index, which has reached 44% compared to the fourth quarter of 2019, a pre-pandemic period.
However, it’s important to note that a full market recovery may not occur within the year, indicating a gradual improvement rather than an immediate rebound.
Despite the slow pace of recovery, the recovery of Thailand’s tourism industry will likely propel the residential property sale market forward. This upswing in tourism could stimulate an increase in the demand for residential properties in Bangkok and other popular tourist destinations in the country.
Overall, the Bangkok residential property market presents plenty of investment opportunities in both the rental and sales sectors.
Residential properties for rent will continue to be a lucrative opportunity for investors and landlords. The resurgence of Thailand’s tourism industry, coupled with the gradual relaxation of COVID-19 restrictions, provides a favorable environment for generating consistent rental income. As the number of visitors increases, the demand for rental properties is expected to rise.
On the other hand, the sales market for residential properties in Bangkok has experienced a decrease in overall prices, making properties more affordable for potential buyers and investors. This creates a perfect opportunity for buyers and investors to enter the market and acquire properties before the anticipated surge in selling prices. By capitalizing on the current affordability, individuals can potentially reap the rewards of future price increases.
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