Bangkok Residential 1H/2023

ECONOMIC OVERVIEW

The recovery of the tourism sector in the first quarter of 2023 has aligned with expectations, providing support for a positive outlook. In the fourth quarter of 2022, real GDP grew by 1.4% year-on-year. Although this fell short of Oxford Economics’ estimate, they continue to forecast a steady recovery in the tourism sector. Tourist arrivals, including Chinese tourists, are on a gradual recovery trajectory but have not yet attained pre-pandemic levels. Bangkok, as the capital city, holds significant importance for the national economy, contributing to 34% of Thailand’s GDP.

It remains an attractive destination for international tourists and expats, boasting a diverse population with 8.6% foreign-born residents. With the potential for a recovery in the hospitality sector, Bangkok holds promise as a hub for both tourism and international communities. Overall, while the investment outlook faces risks (including political uncertainty, high household debt levels, and China’s economic slowdown), the recovery of the tourism sector, particularly in Bangkok, provides hope that Thailand’s economic rebound is underway. 

FOREIGN BUYERS

The foreign-owned condominium market across Thailand has been on an upward trajectory for five consecutive quarters since Q4/2022. While data for Q1/2023 is still being collected, a preliminary analysis reveals a slight decline in the number of units for Bangkok and its surrounding areas compared to Q4/2022. In terms of the distribution of foreign-owned units, Bangkok continues to dominate, accounting for 42% of the total stock owned by foreigners, followed closely by Chonburi at 35%. However, there has been a decline in demand for condominiums in Bangkok over the past two quarters, with an average quarterly decrease of -9%. This trend has been mirrored in the nearby provinces, where demand has also experienced a decline over the same period. Conversely, the demand from foreign buyers in Chonburi, Phuket, and Chiang Mai continued to rally at the end of Q4/2022.