Thai Baht vs Dollar
The evidence for buying and investing in Thailand real estate is mounting into an irrefutable opportunity that shouldn’t be missed. The first reason is the value of foreign currency against the Baht. With the military coup in 2014, the Baht took quite a beating in foreign markets. Subsequently, though, most markets have gotten back to business as usual and the Baht is on the upswing.
Still, as you can see by this Trading Economics graph, the Baht is at 0.23% to the dollar, or roughly twenty eight cents per Baht and an almost all time low. This means that your dollar will go incredibly far when invested in the right property or come to think of it any purchase made in Thailand. Right now, a two bedroom two bath apartment with amenities such as 24 hour security and a pool located in the trendiest part of Pattaya will cost you between $750900 for a month.
If the Baht continues a strong and subsequent upswing, then the opportunity for you to receive the greatest bang for your buck will have passed. This market is a confluence of perfect conditions for investing. Low Baht to USD nonwithstanding. It as if all the perfect conditions have aligned for investors to receive the best possible circumstances.
With the downturn in the oil markets, Russian investors who had capital to burn suddenly had to halt many of the projects in the Pattaya market, leaving a glut of completed or nearcompleted structures. Since the $20 a barrel oil price has been limiting Russian investments, the time is right to purchase a condo that has been priced to move. This is the second reason that it is wise to buy property in Pattaya.
The third reason is the influx of Chinese tourism. With low property prices and an incredible rise in in Chinese tourism, any property purchased will have a better turnover rate than ever. Consider that Chinese tourism not counting those coming from Hong Kong have soared from six million in 2010 to 27 million in 2015! The hotel industry in Phuket reported a 27% rise in Chinese tourist interest in just September during the Moon festival. These tourist are ready to spend and enjoy a longterm comfortable stay.
We see evidence of this growing wave of China tourism in the adjustments in transportation: both Bangkok Airlines and Tibet Airlines have recently announced an increase in flights enabling over 4,000 more Chinese to visit Thailand p er week. With such economic indicators, it’s hard to deny that now is a good time to snatch up property in Pattaya and Jomtien.
TOURISM CHANGES IN THAILAND REGULATION
In an effort to protect both consumers, locals and Thai business in general, the Thai government enacted the Hotel Act in 2004. This act stated that individual owners in Southeast Thailand could not rent by night. However, this sort of legistlature did legitimately hamper the profits of both condo owners, locals who were leaving for vacation themselves, and larger complex owners looking for investors. Over time, though, this nightbynight rental system proved difficult for neighbors and owners with damage to both their property and resident’s peace of mine.
Even though it was over a decade old, the Hotel Act was not enforced until recently, most notably in Phuket. With the condo index up 14% in Bangkok alone, this means expectations of enforced regulations will continue as the government seeks to enforce the act. Phuket has seen an extraordinary uptick in enforcement, but so far, Pattaya seems to be sailing along unassailed. For those who are invested in managed condominiums, this means monthlong commitments will become the norm and thus their rate of return on their investment.
With the Thai Baht at an all time low, most visitors are coming and staying more than a few days, particularly American and British travelers since it proves to be a great value. A month long rental of a fully furnished two bedroom two bath condo in Patamnak Hill, for example is less expensive than a week in a condominium in Florida or along either coast in America, Spain, or France. Thailand with its incredible beaches and legendary nightlife and incredible bargains is becoming the go to spot for foreigners. Goldman Sachs has estimated that the uptick in these travelers will grow from 120 million to 250 million by 2025 with China growing from 8 million visitors to 25 million.
So ride the wave and catch the upswing in tourism that is coming to Pattaya and Jomtien Beach. Take advantage of the properties available now while the dollar and the pound are stronger than ever against the Baht. With the average rate of your investment at 7%, your money will do much better than invested in conventional investment tools back home. Plus you’ll have a place to get away yourself anytime.
Contact us today. Our office is staffed and run by British expats who have lived and worked in Thailand for years and can help you establish a reasonable investment plan without a great deal of difficulty. Invest now and ride the wave of tourism as it pours into Pattaya from the Far East and beyond.