Support from foreigners affected by the Russian war -Ukraine has come to stay in Thailand for a long time, resulting in the condominium rental market growing again in 3 years, especially high-end condos in the city, the price of which has risen past 100,000 baht per month for the first time, supporting the con Douro signals recovery

Overview of the tourism business in Bangkok and the main tourist cities continued to improve from the support of foreigners affected by the Russian war - Ukraine has come to stay in Thailand for a long time, whether Russians, Ukrainians, including China, Taiwan, etc., resulting in the condominium market for rent growing again in the past 3 years, especially high-end condos in the city with moving prices. surpassed 100,000 baht per month for the first time Encourage investors to turn back to buy condos for rent.

Sanchai Khu-Ekachai, Director and Head of Research and Consulting, Knight Frank Thailand Co., Ltd. said it was a good signal for the condo market. When condos for rent begin to recover After the COVID-19 situation subsides, the first activity that people around the world do is Take a trip! Reflected from the increasing number of tourists since the end of last year. Including foreign groups who come to Thailand to work and therefore need long-term residence.

“The condo market began to recover from demand from foreigners affected by the Russian-Ukrainian war, especially for condos in Bangkok. Started to come back as Russian tourists helped stimulate the rental market. plus the opening of China There will be a group of tourists traveling by themselves or the FIT group (Free Individual Traveler) to help stimulate the rental market, although it is not a long-term rental like in Europe, but it will make the rental market start to improve. As a result, the group that bought condos for rent began to buy condos again.”

This is an opportunity to generate income from renting to foreigners. Especially high-end condos in the heart of the city (CBD) that foreigners are interested in long-staying (Long-Stay), causing the rental price to increase, for example, a 1-bedroom unit in a luxury condo zone. Silom, Sathorn, close to major department stores during COVID The price has dropped to 35,000 baht per month, but now the price has been adjusted to 50,000 baht per month, the same as before the COVID.

However, the condo market for rent in Bangkok There are still limitations Because there are many hotels that are ready to accommodate tourists who come to stay. But there are still groups of tourists who want to visit by themselves. who prefer to rent condos instead of using hotel services because it's more expensive Even if it is a second choice from the hotel But there is an important growth trend. This part of demand has improved the rental rate in the condo market.

 Recently, the rental rate of condos in the city was found that Demand for renting condos at price levels 50,000-70,000 Baht per month to 100,000 baht per month, quite a lot. Which this customer group is a group with high purchasing power, focusing on renting high-end condos

Sanchai said that the rental market in the customer group of company employees From Asoke to Prakanong, the main tenants are employees who work in the city, demand has started to come back, but it's not the same. Because the main customer groups work from home or Work from Home (WFH) and in the past have moved to more out of town. Therefore, pulling this group of people back into renting a condo in the city next to the sky train at the price of 20,000 baht is quite difficult. In addition, income has declined against the trend of rising rents.

“Now working in the office for only 3 days and working at home for 2 days has reduced the demand for condo rentals. Even if Covid disappears, the demand for rental will not be the same. Unlike condos in the inner city, the price does not move up much. From the original price level of 20,000 baht, Asoke-Phrom Phong zone, the current price is 15,000 baht, which is considered still low. because the purchasing power has yet to return But if compared to a zone or location that is hard to find that is really close to the city or the city center The rental rate is starting to return to normal.”

In the future, the rental market among customers of company employees must adapt by attracting tourists. with the need to rent condos to replace the missing employees And if the Chinese tour returns faster, it is expected that people working in the hotel sector will return. Causing the demand for accommodation in these locations to increase

“Believe that Bangkok The rental market will improve from the return of Chinese people who come to travel in groups and when China reduces the process of obtaining visas or passports, making it easier for people to enter. will see the filling From renting to buying a condo will come back again. It is expected that it will take 1-2 years to return from luxury condos. in the CBD and in major cities which is in a location that is hard to find first.”

As for the condo rental market, Sanchai analyzes that it will become a major competitor for Airbnb and 3-4-star hotels that compete for FIT customers, who are solo travelers and digital nomads. Most of the 90-95% of backpackers who can work remotely are Europeans who prefer to stay long term for months. which currently has an increasing number

“This is a market gap where customers see alternatives. But it may affect 3-4 star hotels and may collide with Airbnb's service, causing the share of the rental market to change from the original tenants who are local, with 70% being employees, the other 30% being nomads. Especially in Europe who come to live in a long term will rent on a monthly basis. Now the proportion has changed to 50:50 because the purchasing power in the employee market has disappeared.

Source:https://www.bangkokbiznews.com/property/1064728

Date 25/4/2023