Few would argue that the Pattaya property market hasn’t been experiencing some tough times in recent years, but thankfully, it appears that the corner has now been turned. The market has undoubtedly changed in the last decade with investment properties becoming more appealing, especially those catering for short-term visitors to the city. Luxury properties have always been in high demand, and that hasn’t altered, which will be a relief to many of the local developers.
Who is coming to Pattaya?
Visitors from Western Europe and the US have fallen in recent years, and the same story is true with expats. Jobs in the oil and gas industry along with international companies employing expats are becoming fewer in number. However, it is not all doom and gloom; the Russians are returning after their currency, the rouble plummeted a few years ago; with many now again choosing Thailand as a place to live and not just visit. It is a massive boost for local developers and real estate agents such as Alan Bolton.
You don’t have to have been in Pattaya for very long before you realise that the most prominent group is the Chinese. Many of these guests are only coming for the short-term, but there are some incredibly rich Chinese businessmen keen to move some of their money out of China and are therefore looking to invest in property in places like Pattaya. You certainly don’t need to be a genius to realise that this will provide a significant boost.
Types of Property
It appears that the main areas of the market that are doing well are the luxury houses and luxury condos along with the investment properties. The investment properties are being offered by a number of the more reputable local developers, guaranteeing rental returns of anything up to 10% p.a. These properties are then rented out via the developers who have bookings from Chinese travel agents. It is a legitimate way of renting out “condos” short-term (less than 30 days) and is what the marketing is demanding.
Many developers decided to mothball plans for larger developments, particularly condos, a few years ago, but there are signs that they now seem to be re-entering the market; a sure sign they have confidence in the market. Demand for luxury homes and villas have remained high along with high-end luxury condos in the resale market. It is these types of property that are also appealing to affluent Chinese buyers.
Eastern Economic Corridor (EEC)
The EEC stretches from Chachoengsao near Bangkok to Rayong Province and is an area ear-marked for industrial development in the forthcoming years. Large investment has already been made, with more promised. It will create thousands of jobs in the area for both locals and expats, and will undoubtedly be a boost for the Pattaya property market.
Buyers or Renters
The demographics of buyers have certainly changed over the years with Western European and US buyers being few and far between. Luckily, from developers’ and real estate agents’ point of view, these have been replaced by Chinese and Russian investors. In terms of rentals, there has been a noticeable shift away from long-term rentals. These days, many are now less than three months. Airbnb tends to take care of the daily/weekly market, which is technically illegal. We’ll cover that in a subsequent article