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Dwindling high end rentals down to Bangkok expat relocations
| Published: | 26 Jul at 6 PM |
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As demand shrinks, partly due due to expats packing up and leaving, the Bangkok housing market is being forced to change its focus from rental apartments to single-owner homes for Thais.
Previously, the rental supply and demand mechanism concentrated on larger, two-bedroomed condos suitable for expats arriving with their families to live and work in the city. Nowadays, companies are lowering their operating costs and saving money by not having to fund tuition fees for expat children as well as the high cost of maintaining a family in Thailand’s increasingly expensive capital city. One-bedroomed units are still in demand, but the number of expatriates is steadily declining.
The decrease in expat numbers is across the board demographically with, for example, Japanese occupancy now comprising less than 20 per cent of all expatriates living in Thailand. The Western expat community is also in decline, although Chinese occupancy is increasing in cheaper districts where there’s already an established Chinese community. In addition, the newly-introduced building and land tax isn’t helping landlords with large property portfolios.
Developers in the city are now shifting their focus away from high-rise condo buildings to the low-rise housing market catering for Thai end-users. Smaller, single detached homes and townhouses suited to the Thai lifestyle of local people on fixed budgets are now featuring in development portfolios, demonstrating functionality, conventional designs and sizes at affordable prices. Even so, the market isn’t expected to pick up until the economy improves, bringing with it an increase in disposable incomes. Combined with falling tourism arrivals and the long-stay expat diaspora, it would seem Thailand’s troubles are far from over.
Previously, the rental supply and demand mechanism concentrated on larger, two-bedroomed condos suitable for expats arriving with their families to live and work in the city. Nowadays, companies are lowering their operating costs and saving money by not having to fund tuition fees for expat children as well as the high cost of maintaining a family in Thailand’s increasingly expensive capital city. One-bedroomed units are still in demand, but the number of expatriates is steadily declining.
The decrease in expat numbers is across the board demographically with, for example, Japanese occupancy now comprising less than 20 per cent of all expatriates living in Thailand. The Western expat community is also in decline, although Chinese occupancy is increasing in cheaper districts where there’s already an established Chinese community. In addition, the newly-introduced building and land tax isn’t helping landlords with large property portfolios.
Developers in the city are now shifting their focus away from high-rise condo buildings to the low-rise housing market catering for Thai end-users. Smaller, single detached homes and townhouses suited to the Thai lifestyle of local people on fixed budgets are now featuring in development portfolios, demonstrating functionality, conventional designs and sizes at affordable prices. Even so, the market isn’t expected to pick up until the economy improves, bringing with it an increase in disposable incomes. Combined with falling tourism arrivals and the long-stay expat diaspora, it would seem Thailand’s troubles are far from over.
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