Real Estate Investment Opportunities in Thailand

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Real Estate Investment Opportunities in Thailand

Thailand is one of the most interesting real estate markets in the world offering plenty of opportunities to acquire splendid properties and even make a significant profit on your initial investment. Thailand has a unique climate that ensures year round good weather as well as beach side properties that reach out onto the beach and the ocean.

The unique legislation of Thailand makes foreign investments in real-estate rather challenging, however, there are numerous companies and brokers that have facilitated foreign investments creating one of the most profitable markets in Asia particularly due to the somewhat restrictive laws.

Basically, according to the country’s legislative system foreigners are prohibited from acquiring or owning land unless they are part of a group that is at the very least 51% owned by Thai nationals. This has led many people to form mixed association or companies that are investing heavily in real estate, particularly in tourist friendly areas like Pattaya, Phuket or the country’s capital city Bangkok.

No location is perfect. But ideally, you’ll have to research for strong economic signals, a rising number of tourists, and a low unemployment rate. It is helpful to read the news about previous year real estate market situation.

Some of the best investment deals for foreigners are found in Koh Samui luxury condominiums as they generally require a larger investment anyway. This means that forming an association between a series of investors was necessary anyway so the legislation problems that prohibit foreign investors become irrelevant.

Thailand is one of the biggest touristic destinations in the world with millions of visitors each year that come to take advantage of the local beauty, unique culture and stunning locations. Investments in hotels, resorts and spas are considered to be one of the best directions to go with when looking for real-estate deals.  With the industrial and commercial growth the country has registered in recent years residential building in Thailand’s major cities, like Bangkok, Phuket or Pattaya is also growing. A new generation of more demanding young professionals also means the need for a more diversified housing market. This in turn leads to more projects that range from luxurious condominiums to modest apartment blocks or new suburban neighborhoods.

The bottom line is that whether you choose to invest in a condominium with local partners, buy an apartment in a condominium and resell at a later point for profit or bring a sufficiently large enough investment and start up a resort, Thailand is the place to do it. The relatively cheap price of land, abundance of high-quality cheap labor and demand for residential housing make it an attractive investment opportunity that will continue to grow in the next couple of decades.

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Weaker Thai Baht Is Incentive For Foreign Real Estate Investors

The political and military tribulations that have shaken Thailand in the last couple of years have also taken their toll on the country’s currency, with the Thai Baht losing ground versus most major currencies on the market like the pound sterling, the US dollar or the Euro. While this means reduced purchasing power for local investors, foreign investors are faced with an immense opportunity as Thai properties sell for approximately 20 percent less since the fall of the local currency, according to local economists and real estate agents.  This means that from the modern penthouses of Bangkok to the breathtaking villas in Koh Samui, Thai property and real estate is as attractive for investors as it’s ever been.

While the Baht might not shows signs of improving any time soon, particularly with the recent political crisis that is affecting the country, the window of opportunity for foreign investors is not going to last forever. Local property developers are starting to be much better informed about the increased purchasing power of foreign investors and are raising their prices. The realignment of the market will make new and modern properties basically not affordable for the average Thai family while foreign investments will slowly decrease.

Nowhere is this truer than in the beautiful island of Koh Samui where property developers are reporting a record number of closed sales for foreign investors. The most attractive real estate on the island is still on the North East coast with condominiums as well as luxurious villas selling far better than in any other location in Koh Samui. Laem, Bophut and Chaweng are some the areas where demand is highest, particularly for mid-range properties.

The most desirable properties for foreign investors seem to be those that yield a double digit rent and have a good growth potential. The potential for renting vacation villas on the island is huge, and while Thailand and particularly Koh Samui are well-known vacation destination, there is still room for growth in the tourism sector as soon as political stability is achieved.

Economists said that further construction growth is expected in Koh Samui as all the properties that are currently on the market are quickly being purchased by foreign capital. Increased media interest in the region has also increased its potential among both local and foreign investors making Koh Samui one of the current engines for growth in a country where political instability seems to be the norm of late.