Yes! This is according to the PropertyGuru’s Property Sentiment Index H2 2020, which collaborates opinions to grasp perceptions on the state of play of Thailand’s real estate market.
The most notable fact collected from this research is that 43 per cent of non-property owners plan to rent a property in the next year illustrating the sheer strength of the lettings market. Of this group, the majority do not have any plans on how long they intend to rent for, while 38 per cent have plans to buy property in two years.
So what is stopping these renters from making a property purchase? The main reason cited was a lack of funds – a sentiment shared across all age groups proving that rental properties provide a service for those unable to afford to get onto the property ladder. The top next three reasons for remaining as a property renter rather than owner held equal strength amongst the respondents.
These were that they would rather spend their money than save to own a property, that the property market is currently unstable with values depreciating and that the government regulations do not make it easy for first-time buyers to enter the market.
These reasons are diverse with no simple solution to fix all, but they do provide confidence to landlords who own property to generate an income stream. These landlords should also note that one-bedroom units are most in-demand, suggesting that people want to live on their own or with a partner as opposed to residing with friends. Renters also expect to pay THB 6,645 a month in rent, which landlords should factor this in when looking for a suitable investment property.
Renters prioritise location to their office suggesting the need for rental units to be within the city’s central business districts, however, could this change with the arrival of COVID-19? It could go one of two ways.
Either renters now have more flexibility and might no longer need to head into the office as regularly as before, or some renters might want to remain close to the office for fear of catching the virus whilst commuting to work on public transportation.
The next two most important concerns for tenants when looking for a property relate to the property location, with security and maturity of the area being of utmost concern.
Turning to landlords, the vast majority understand the importance of a tenancy agreement when renting out their property. Good news for both tenants and landlords alike as a tenancy agreement stipulates the obligations of parties on both sides to avoid any disputes later down the line.
Lastly, landlords remain happy to rent to foreigners. This helps this segment of the market who are not in a position to buy due to only being in Thailand for a short period, do not qualify to invest, would rather rent or do not have sufficient funds.
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