Thailand can expect stronger demand for rental residences, especially from foreign expatriates or young workers who may not be able to afford to purchase a home, according to rental residence developer Homa.
Founder and managing director Luca Dotti said a global trend shows people opting for travel experiences and sharing moments, while delaying purchases of assets.
Mr Dotti said that since the pandemic, there has been a great migration trend of workers moving out of Singapore and Hong Kong to other more affordable places, such as Phuket, which is a market with a strong residential demand among remote workers.
As workers relocated to Phuket and Thailand with their families, demand has grown for the development of bigger apartments, rooms with kitchens, and car parks, with close proximity to vital services.
Homa opened its latest property in the Cherngtalay area of Phuket, with 423 keys, in January 2024, making a total of three properties in the company's Thailand portfolio.
To cater to this co-living trend, unlike rental residential in Singapore which commonly focuses on single living units, Homa Cherngtalay offers a wide range of room types, from a studio to a three-bedroom duplex.
So far, Homa Cherngtalay has secured an occupancy rate of over 50%, mostly driven by long-stay tourists. It is expected to attain a 90-100% occupancy rate within the next 3-4 months.
It expects to secure 80% long-stay rental contracts, from 1-12 months, while 20% will target short-term visitors as it also holds a hotel licence, enabling the property to provide services equivalent to four-star hotels.
The two other properties the company operates are Homa Phuket Town with 505 keys and Homa Si Racha with 100 keys, which secured an occupancy rate of around 90% last year.
The Phuket Town location recorded a large number of Russian residents or around 40% of total stays, while 90% of residents in Si Racha are Japanese expatriates, attributed to their close proximity to an industrial estate.
All properties are owned and operated by Homa, which is a joint venture between Asia Capital Real Estate and Noon Capital.
Looking ahead, the company will continue to develop new projects through its rental residential model, Mr Dotti said.
Its rental rates cover the cost of the accommodation, housekeeping, the water bill, WiFi and access to common facilities such as a gym, a pool, co-working spaces and other leisure activities, which distinguishes Homa from condominium rentals, said Mr Dotti.
To manage the room rate during the high season, Homa also utilised a daily rate hike strategy in the same way hotels do, which saw average daily rates reach 4,000 baht at Homa Cherngtalay and around 3,000 baht per night at Homa Phuket Town, compared to around 2,000 baht during low season.
It plans to open Homa Chalong Bay in Phuket next year, and another property in Sukhumvit 12 in Bangkok's Asoke neighbourhood by 2027, giving the company a total of 3,000 keys across five properties in the portfolio.
Each property is expected to break even within five to six years.
