Tourism, agriculture beefs up demand in Northeast
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Tourism, agriculture beefs up demand in Northeast

The Mice (meetings, incentives, conventions and exhibitions), tourism and agricultural sectors are expected to continue driving housing demand in major provinces in the Northeast despite the rate of inflation, with the help of China’s reopening earlier this year.

Wuttichai Chatchaiphonrat, president of the Khon Kaen Real Estate Association, said the residential market in Khon Kaen would maintain a positive trend this year despite several negative factors.

“The end of the easing of the loan-to-value limits, rising interest rates and inflation will have an impact on housing demand. However, the overall economic factors in the province are likely to support continuous growth in the residential market,” he said.

He said Khon Kaen is the region’s educational and medical hub, as well as boasting a growing industrial sector.

The province is also equipped with a ring road extended from four to six lanes.

Khon Kaen might not be a magnet for tourism, but its focus on Mice could attract more arrivals and increase the number of flights.

According to the Real Estate Information Center (REIC), Khon Kaen posted a consecutive recovery in new residential sales of 871 units in the second half of 2022, up from 664 units in the first half of 2022 and 595 units in the second half of 2021.

Sales had bottomed out at 346 units in the second half of 2020, down from 894 units in the first half of 2020 before recovering to 554 units in the first half of 2021.

Jaturong Thanapura, president of the Udon Thani Real Estate Association, said the opening of Robinson Department Store this year and the hosting of the International Horticultural Expo 2026 in Udon Thani would create economic activities in the province.

“The economic sentiment and consumption showed a flat growth while the service and durable goods sectors witnessed an improvement,” he said. “Farmers’ income increased due to the conflicts elsewhere, resulting in a return of home purchasing power.”

He said the industrial sector in Udon Thani would improve this year after it remained unchanged in 2022 as China’s reopening would revive the province’s economy.

“After China reopened, Udon Thani benefitted from its close proximity to Laos,” he said. “Though the province is not among the country’s major tourist destinations, it now attracts Thai visitors due to places related to religious beliefs.”

In terms of residential sales in Udon Thani, REIC reported a total of 207 units worth 828 million baht in the second half of 2022, a recovery from just 81 units worth 280 million baht in the first half of 2022 — the lowest level over the past several years.

Narathorn Taninpitak, advisor of the Nakhon Ratchasima Real Estate Association, said that the tourism industry in Khao Yai had noticed a significant change, with an increasing number of foreign tourists. Previously, the majority of visitors were Thais.

“This trend is expected to have a positive impact on the local economy, resulting in improving the income of local residents,” he said. “The effects of this trend are expected to become apparent during the second half of 2023.”

Nakhon Ratchasima is expected to see an economic expansion of 2.8% in 2023.

The key driver would be the agricultural sector which would grow by 5.9%, followed by the service sector with a growth of 2.9%.

The number of tourists would rise by 54% in 2023 after jumping 96% in 2022. Last year the province’s economic growth reached 1.5%.

“Despite the potential, home purchasing power in Nakhon Ratchasima still requires policies and measures to stimulate the market and make it easier for homebuyers to own a unit,” Mr Narathorn said.

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