Success in handling the outbreak is poised to drive the foreign market this year and next, particularly buyers from China and Hong Kong, though travel restrictions are hindering presales
Thailand's property market will be more attractive to foreign buyers following the pandemic after the country was praised for its handling of the outbreak, including a high rate of recovery, according to property developers and analysts.
Thongchai Busrapan, chairman and co-CEO of SET-listed Noble Development Plc, said the property market next year will be more positive because Thailand has successfully coped with the coronavirus.
"Buyers in Singapore, Hong Kong and China are now considering a property investment in Thailand because the country is perceived as a new medical hub and a safe haven," he said.
The company plans to market to Chinese buyers once the travel restrictions on international passengers are lifted. Noble is in talks with a distribution network in China on the launch of a condo project on Ratchadaphisek Road.
Mr Thongchai said the project received positive feedback from foreign buyers, but the conversion rate from interest to a purchase remained low because of the inability to travel to Thailand for a physical visit at the sales gallery.
To improve the sales conversion rate, Noble in April developed a proprietary digital sales platform to create a seamless purchasing process, in line with a big growth rate from Chinese online sales.
"The Chinese buyer market bottomed out after the Covid-19 outbreak eased up," Mr Thongchai said. "More property buyers in China went to online channels."
Noble has been one of the most successful developers in the Chinese market. It recorded 3.5 billion baht in overseas presales in 2019, up 43% from 2018 and 50% higher than the four-year average.
In the first half of 2020, it recorded a further 895 million baht, which accounted for 34% of the total in the period, an uptick of 23% from the same period last year.
Some 68% of overseas presales in the period were from China, followed by Hong Kong (14%), Taiwan (5%) and Singapore (3%).
"To tap the Chinese buyer market, a strong network is a must," Mr Thongchai said. "Thai developers should also educate themselves about the market, while the government should find ways to draw foreign visitors to travel here more conveniently."
Residential developer Pruksa Real Estate is also aggressively targeting Chinese buyers.
"Appropriate management of the Covid-19 situation in Thailand will create an opportunity to draw foreign buyers to condo projects," said Piya Prayong, Pruksa's chief executive.
The company is preparing active marketing, both online and offline, for condo projects targeting Chinese buyers in the second half of this year.
Chanond Ruangkritya, president and chief executive of SET-listed Ananda Development Plc, said the company used power-of-attorney forms to promote condo transfers among foreign buyers who were unable to do it themselves.
"Demand from buyers in China and Hong Kong remains strong," he said. "We need to help them buy or transfer units more conveniently because they cannot travel here."
Mr Chanond suggested non-voting rights for foreigners buying units at condo projects by allowing them to own more than 49% of total space, exceeding the foreign quota at popular locations among foreign buyers, such as Ratchadaphisek and Rama IX roads.
Aliwassa Pathnadabutr, managing director of property consultant CBRE Thailand, said such a suggestion is complicated and would discourage some foreign buyers.
She said demand for second homes in Thailand's resort destinations will increase as foreign buyers see Thailand as a safe haven, concerned about future unexpected events like the Covid-19 outbreak.
"Not only will Thailand's reputation for containing the outbreak help attract foreign buyers, but also our strengths in the tourism and hospitality industries," Ms Aliwassa said.
She urged the government to provide more incentives to lure additional foreign buyers to the Thai market.
"Thailand should capitalise on our key strengths, not only as an investment destination but also for second homes," Ms Aliwassa said. "The ease of investing and doing business in Thailand must be improved to make things more convenient for foreign buyers."
According to CBRE research, there was little evidence of foreign sales in the first half of 2020. But enquiries from the offshore market expanded to a wider area compared with 2019.
Apart from Hong Kong and China, new enquiries for resort homes came from Taiwan, Singapore and Europe.
CBRE has great confidence that Thailand property will continue to be attractive to foreign buyers in the post-pandemic market, Ms Aliwassa said.
"Though at this point, 2021 will still be a tough year for foreign demand because the removal of travel restrictions will be slowly implemented," she said.