Real estate consultancy says pandemic continues to affect foreign demand

A leading property consultancy says the ongoing pandemic and associated restrictions continues to hamper the real estate market. CBRE Thailand chief, Roongrat Veeraparkkaroon, says the low number of foreign arrivals means the sector continues to rely on local demand and must now adapt to these circumstances.

“A decline in tourist numbers affected both residential and retail sectors. Given this challenge, the property market should adapt, be more proactive, and brace for uncertainties that could emerge.”

According to a Bangkok post report, Roongrat’s colleague, Rathawat Kuvijitrsuwan, says the real estate sector currently faces 4 risks. They are the future path of the pandemic, spending power, government policies, and international travel restrictions.

“There may be new variants of Covid-19. It depends on how the vaccines respond to them and how the government and public react to the situation.”

He adds that Thailand’s economy relies on international tourism for its recovery and for now, the residential property sector has to rely on local demand. This in turn lowers sales as, unlike many foreign buyers, domestic purchasers are usually end users and take longer to decide. However, Rathawat says local demand remains strong in the case of some properties.

“Niche markets, or those with solid demand drivers, like projects near universities or branded residences, will continue to perform despite the economic downturn. Resort homes will still be attractive to local buyers, but the price must be right.”

Rathawat points out that purchasing power is a significant factor and has been severely affected by the pandemic. In particular, the retail sector has been hit hard over the last 2 years.

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“As one of the sectors most affected by Covid-19 and government restrictions, the retail industry will have to evolve together with these constraints.”

SOURCE: Bangkok Post