Bangkok property Investment Opportunities May 2020
Before I start about Bangkok from an investment point of view let’s look at Bangkok as a business hub and a lifestyle destination. Bangkok is the world’s number one destination, yep it’s the most visited city in the whole wide world and there must be a very good reason for that. Then you factor in the infrastructure in Bangkok compared to other cities in South East Asia and its way ahead only behind Singapore and Hong Kong. It’s also a great business hub for international business and most importantly it’s a great place to live.
Now the good news for Lifestyle buyers and to a lesser extent investors Bangkok is probably now the best value for money property market in South East Asia when you put all of the above factors into the market and this might be your one and only chance to grab yourself a piece of Bangkok. As I wrote in a recent Manila V Bangkok property markets article you can buy the Four Seasons residences on the Chao Phraya River for the same price as Aurelia in BGC Manila. From a lifestyle choice it’s fairly obvious what 90% of people would choose. When you then make a comparison with Hong Kong and Singapore prices then it becomes very attractive indeed.
Now for the relative bad news but that has a silver lining as well as long as you’re not selling up to go to another country. That is Bangkok currently has an oversupply of Condos with more state of the art condos to complete over the next two years there has never been a better time to buy. But as an investor don’t expect price rises or capital growth anytime soon. Now for the good news if you’re a medium to long term investor once the oversupply has been taken from the market then expect prices to rise. In the meantime, with these prices you should be able to get net yields of around 5% or higher.
BANGKOK MARKET OVERVIEW
So very simply the Bangkok property market is one of the most diverse in the world and you can buy from $2000 USD per square meter to the amazing yet to be released One Bangkok project at close to $20,000 USD per square meter. This means you buy a one bed unit in an old building at 100,000 USD or a Penthouse in Four Seasons Private Residences at $15M USD (if you can find one available). Different factors will determine that with the age and location of the project as well as the caliber and quality of the project.
As for location there are many different areas but for this article I am going to focus on the main two areas and why you would pick them
RIVERSIDE LUXURY CONDOS – CHAO PHRAYA RIVER
Home to some amazing residences such as Four Seasons, Mandarin Oriental and home to all the major Hotels such as Shangir-La. Riverfront living in Bangkok is the first choice of many who can afford to. With Gray Stuart we can generally find you a unit at 10,000 USD per square meter which is well below market value. This means that to own one of these types of Condos you will need in excess of a million dollars. There will be some other Condos that are not riverfront but in the same area for less money. So from a business perspective you are not on BTS line and will need a Taxi or car and driver to get to the central points of Bangkok. However, if you can afford 1 Million dollars for a Condo its very likely you will have your own car and driver and more importantly the tenants who are paying your rent are likely to do so.
SUKHUMVIT ROAD – ASOK TO THONG LO
Basically this is where the majority of investors will look to buy as most of their tenants will want accommodation that is close to public transport and the BTS line that runs along Sukhumvit road. Which is the major road of Thailand running all the way to the Cambodian border. Another important factor here is you will able to buy close to this area for as entry level of $150,000 USD and like Chao Phraya river you can spend millions of a Condo in Thong Lo area. Another tip for investors is that the oversupply is mainly in studio and 1 bedroom units so if you’re looking at an exit strategy 2 and 3 Bedroom units will be easier to sell.
There are other notable areas such as Lumphini Park that is also a great location for higher end projects but we will stick to these two for purposes of this article.
Key Bangkok Developers.
There are very many to choose from so we have selected 3 to give you a flavor of the different type of developers.
SANSIR GROUP PLC
Simply the number one Developer in Thailand with over 20 projects in Bangkok alone including their flagship 98 Wireless the number one address in Bangkok and most expensive. However, they focus on properties for all so have smaller more affordable units in less desirable locations.
MAGNOLIA QUALITY DEVELOPMENT CORPORATION – MQDC
At MQDC, who have constructed Mandarin Oriental Private Residences they believe the design and development for sustainability can be achieved from a small change in detail to a disruptive innovation. They are focused on high quality developments either branded or their own name such as Magnolias Waterfront Residences.
ANANDA DEVELOPMENT PUBLIC COMPANY LIMITED
With over 25 Developments in Bangkok alone they have a wide range of projects to suit every buyer’s needs. They have projects starting at $4000 USD per square meter and are high quality notable projects include Ashton Asoke and Ideo Sukhumvit.
In the current market you may find it much better value to buy one of these projects as a resale rather than directly from the developer but if you were to buy into any project built by these developers mentioned above it would be a good choice.
Investment Strategies for International clients
Most importantly the first thing to know about Thailand property market is that a Foreigner on a tourist visa will not be able to obtain finance so you will need to be a cash buyer but that puts you in a very good position in relation into getting the best price available and buying below market value.
If you are not in positon to pay cash than pre-selling off plan units will allow you to get into the market and allow you to defer the major part of the purchase until Delivery.
Most importantly each lifestyle buyer and property investor will have different needs and requirements and with this in mind Gray Stuart offer a unique exclusive service where we will ascertain your needs, your budget and your exit strategy and then recommend the best solutions to meet your needs. It goes without saying every client’s solutions are different. As part of that service we can help you open bank accounts, set up a Thai corporation, basically any service an international client would need or want.
If you’re a medium to long term investor or a lifestyle buyer there has never been a better time to invest into Bangkok property with the value for money it represents against the other world property markets at the time of writing this article. If you would like any help or advice in relation to the Bangkok property market, then please contact me or one of my team.