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Buying condos and apartments in Bangkok

Because of strict laws and restrictions regarding foreigners purchasing land in Thailand, the most popular option for foreigners is to invest in condos and apartments. Within Bangkok, there are several property developments owned and managed by foreigners who specialise in providing services to the expat community. Many more Thai development companies are also targeting this increasingly lucrative sector of the market, and all new buildings will have and English speaking sales team, reception and management members.

For those purchasing condos and apartments in Bangkok, there is an incredibly large market for luxury upscale units. The recently completed condominiums have begun a movement of competition for those who are selling or leasing their properties and units. This competition creates even more options for potential buyers. Over the past couple of years, over 39,000 units have been started or completed.

Much of the newer developments appear to be centred around the Sukhumivit, Sathorn and Silom areas. The size of the units in these areas range from 45sqm to 80sqm and include one, two or bedrooms. For the extremely high end condos in these areas, three to four bedrooms ranging from 90sqm to 190sqm are quite common. It is more common for buyers to aim for the lower end of the condo spectrum. There is also a market for buying bargains in modest or ageing buildings that might have had difficulties during the ’97 crash, renovating them and selling them on at a profit.

The latest trend in purchasing condos is the off-plan method, in which buyers no longer need to see the actual unit they will be purchasing. They simply trust in the company’s reputation and make their decision based on the development’s show rooms. This method is not at all uncommon in Bangkok as nearly 10,000 units were sold in 2018 strictly via this method. Buying pre-build qualifies you for good discounts, up to 30 per cent. If the project sells out and is successfully completed the value may rise even further. Typically a deposit and installments are due throughout the building schedule (up-to 18 months), with transfer of ownership upon completion of building and payment.

Many investors make good income investing in these and selling before transfer from the developer is made, avoiding a transfer tax. In some cases the more progressive developers offer to lease the units on your behalf with guaranteed returns sometimes in excess of 10 per cent, although this figure is unusual. However, buying ‘off spec’ is risky and projects do fail, leaving buyers out of pocket. Despite the lessons learnt from the 1997 financial crisis, which left plenty of half finished buildings dotting the Bangkok skyline even a decade later, companies regularly run out of capital or encounter cashflow problems. It’s very important that you thoroughly vet the developers’ reputation, the rate of sales in the building, and the economic outlook, as these all conspire to leave some investors in an ugly legal situation that sometimes becomes difficult to resolve fairly. In other cases the developer has defied building restrictions, counting on bribery to resolve any problems, but authorities have begun to crack down. Some buildings have had their construction approval suspended as a result of illegal activities.

At the beginning of 2020, Bangkok’s condominium market’s selling prices averaged at around 140,020 baht per square metre. Prices continue to increase around 10 per cent each year. The Lumpini and Sathorn areas are home to some of the largest developments in the city.

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