Last updated on August 21st, 2023 at 03:07 PM
To buy real estate with sea view in Thailand, near the Temple of the Tigers, is tough for everyone. The Thai real estate market is still new. However, gradually the mysterious country opens up to us. It has a great climate, friendly people, and affordable housing.
What to choose
Pattaya is the most convenient resort in Thailand for foreigners; in other resort areas, according to market experts, “foreign” infrastructures are less developed. Only Bangkok can be compared with Pattaya, but this is a huge stuffy metropolis.
In addition, real estate in other resorts in Thailand is more expensive. For example, if in Pattaya for $120,000–150,000 you can buy an apartment with one bedroom and a panoramic view of the sea, in the respectable Hua Hin – the summer residence of the king – for this money only a “kopeck piece” remote from the beach is offered without any interesting view or apartment not far from the beach, but 1-room and overlooking the neighboring house and a piece of the sea. There are fewer offers in this city, and apartments with panoramic sea views are piece goods, and they cost at least $400,000–670,000.
The second most popular resort in Thailand among foreigners is the island of Phuket, which also has a good infrastructure for foreigners, one of the most expensive regions for acquiring real estate.
There are practically no condominiums here. Mostly townhouses and private houses are sold, and if it’s a “condo”, it’s of high-class status.
For example, an apartment of 127 m² with two bedrooms, without a sea view, but furnished and equipped with appliances in The Holme Place Condominium, which has two swimming pools and a fitness center, and situated 400 meters from Karon Beach, is offered for about $470,000. More modest housing can be bought in the city of Phuket, where there is no beach, and, for example, on Kata Beach. A 2-bedroom apartment of 90 m² in Kata Ocean View Condominium, however, again without a sea view, costs about $200,000.
A 2-bedroom townhouse in a luxury residence 800 meters from Kata Beach can be bought for $400,000. House prices start at $270,000 but end up in the millions of dollars: “Phuket has a particularly privileged place, Banyan Tree, Phuket Resort, the exclusive selling agent of which is Knight Frank. A five-star hotel operator of a well-known boutique hotel chain manages the complex.
Having bought a villa here, you can use restaurants, fitness centers, and other hotel services. The unit can also be rented out for a long time. And a villa costs $1.8–4.2 million.”
A similar situation with real estate and its value on the island of Koh Samui. There are restrictions on the height of buildings, and therefore 95% of the market is individual houses.
Only Rayong, also located on the shores of the Gulf of Thailand, can be compared with Pattaya for prices. Wealthy Thais love to relax here.
The beaches are cleaner than in Pattaya, and, here you can also buy an old apartment for $15,000 (but you can also buy for 15 million baht, that is, for $500,000, in a new complex right on the beach).
However, the infrastructure for foreigners is still rather weak, and it is difficult to rent out the property. So Rayong is more of a 5-7 year perspective.
The Thai real estate market has never been one of the fastest growing, and it can be difficult to resell an object; nevertheless, prices here are slowly but steadily rising.
The Thai market is still undervalued and has good growth potential since 90% of real estate is used for living or renting and not for speculation. And this did not pass by foreigners, who began massively buying housing here.
The investment mechanism is simple: for example, an apartment for $100,000 is bought in installments in a project under construction: the first instalment is 20%, then another 50% of the cost is paid quarterly in equal installments for 2 years, and when the house is handed over in 2.5 years, the last one is paid 30% down payment.
Having bought an apartment at the very beginning of sales (pre-sale), you can count on a price 15–20% below the market price, and after about 12 months, when, according to all the laws of marketing, the developer raises it by 10–15%, you can sell the contract for an apartment for $115,000 because the best objects will already be sold out, which will give reason to “break” the price. “In a successful project, such a contract is sold in 1–2 months”.
We get the following financial result: investments – $40,000, income – $15,000. Thus, the profit is approximately 37% per annum, and even considering all the transaction costs – at least 25%.
Over the past 2 years, they have received about a dozen package investors from different countries, who invested in promising real estate objects in Thai resorts (not only in Pattaya) in Hua Hin and even in Rayong).
The return on their investments ranged from 22 to 29% per annum with investments from $350,000 to almost $4 million.
Thus, at first glance, Thailand, which is unpromising in terms of investment, can bring good profits. However, only if the object for capital investment is correctly chosen.
If you buy illiquid housing, and the risk of such a purchase is not so small in Thailand, then you can return your money in a slowly growing market, which the country is today, only after a few years.
So investing in the real estate of the sunny kingdom should be very careful and always under the supervision of an experienced and highly professional real estate agent.
So to sum it all up, it is most practical to buy and rent housing for a long time here, but other resorts in Thailand are open to foreigners.
And since investing in Thai real estate can be the most profitable way to allocate capital, remember that it is worth buying only if you fell in love with Thailand. Thailand-Real.Estate can help you to choose the most promising option.