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Thailand’s property market waits for an end to Covid-19

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The Coronavirus outbreak poses challenges for Thailand’s property market as potential Chinese condominium buyers remain stranded in China. Meanwhile, some believe that the outbreak may bring opportunities for non-Chinese buyers and in the long-run, the Chinese may be looking for an overseas refuge in the event of these types of emergencies popping up again

Through all this, there will be a certain level of pent up demand for Thai real estate.

Of course, it’s not just the Chinese unable to come and inspect potential buys, the rest of the world is also mostly shut out of Thailand.

Market remains weak

The pandemic is hurting the condominium market as Chinese nationals were accounting for half of the international buyers in Thailand, or 57.6% of the total foreign condo owners in 2018.

Vichai Viratkapan, acting director-general of the Real Estate Information Centre says that 50% of Chinese condo transfers are expected to disappear in the first 2 quarters of this year and the total transfer value by the Chinese will miss the mark of the usual 29 billion baht by about 25% (around 7 billion).

However, since Chinese property buyers only make up 6% of the total international and domestic housing transfers in Thailand, the proportion of total housing transfers in the country is likely to be similar to last year.

Developers looking to sell current stock whilst shelving new projects

CBRE reports that most Thai developers are postponing the launch of new condo projects to focus on clearing existing stock.

“Discounting completed projects to generate quick revenue as a financial lifeboat is the best solution for many of the country’s larger developers whilst the market is in limbo.”

Rathawat Kuvijitrsuwan, head of CBRE Research and Consulting in Thailand believes that, now business is gradually recovering, a few developers have started to launch new condominium projects.

“In the first half of 2020, the Bangkok condominium landscape was gloomy with fewer than 10,000 condominium units launched, which was much lower than the total number of new launches in the past three years of more than 60,000 condominium units per year.”

The Chinese are reluctant to complete transfers

The virus has continued to affect hospitality operators, including hotels and condominiums that service tourists, nationwide. Since China has suspended tours, put restrictions on movement, and locked down cities, home to over millions of people, it also poses a threat to real estate developers as their clients are unable or unwilling to fly.

“Currently multiple off-plan condominium developments are approaching completion, and Chinese clients are unable or unwilling to transfer. Chinese clients who made a reservation in Q4 2019 are requesting a refund and withholding their investment,” said Marciano Bijmohun, Business Development Director at FazWaz Property Group.

He believes every condominium that is in transfer status will see the percentage of non-transfer units rise in the coming months.

“These non-transfer units will cause a big financial hit to developers.”

If a client refuses to transfer, does not comply with the terms and conditions stipulated in the sales and purchase agreement, and decides to release the property, their deposits will be forfeited.

“However, there is some good news, these non-transferred units can be offered with a discount to new clients.”

Also, as China has been susceptible to a few disease outbreaks – from bird flu to the current coronavirus – it may prompt Chinese buyers to look for second homes outside of China.

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13 Comments

13 Comments

  1. Avatar

    Preesy Chepuce

    September 2, 2020 at 2:08 am

    Overpriced property bubble.

  2. Avatar

    Dirty farang

    September 2, 2020 at 12:02 pm

    I believe more than 50% of units in all condos are empty, so “clearing existing stock” can take a long time.

  3. Avatar

    Mike Frenchie

    October 18, 2020 at 2:55 pm

    That will also impact the gdp… the 50.000 ‘not started’ condos in BKK this year mean less salaries, concrete, support services, etc.
    Most big real estate developers are probably in the debt moratorium… (for hundreds of billion of THB), if foreigners are not allowed to come back… just imagine the impact on the banks! Lastly, Thais will not replace the foreigners so quickly since their own jobs are now insecured while their purchasing power is very different for most.

  4. Avatar

    Issan John

    October 18, 2020 at 2:55 pm

    “…Chinese clients who made a reservation in Q4 2019 are requesting a refund and withholding their investment,” said Marciano Bijmohun, Business Development Director at FazWaz Property Group.”

    Interesting to know on what grounds they think they could justify a refund – but, as the article points out, good news for both other buyers and the seller since the seller can afford to give a discount without losing anything.

    • Avatar

      Mike Frenchie

      October 18, 2020 at 3:37 pm

      Anyone having bought a condo in Thailand knows that the contract does not foresee a reimbursement! At the transfer stage, they have usually paid 50% already (nobody can afford to loose that).

      The problem, in Pattaya at least, is that most developers have stopped building after the start of the project… allowing the buyers to stop paying, not to mention the very large number of developers unable to get the chanote (title deed) because of money problems.

      Two years ago it was bad, now it is surreal.

      • Avatar

        Kevin

        October 18, 2020 at 9:06 pm

        When would be a good time to buy in pattaya or Jo tien mike

  5. Avatar

    murika

    October 18, 2020 at 8:23 pm

    this condo market is all about money laundering and pyramid schemes, most people pay in cash, and thai government never ask where the money come from, a friend of mine work for one of those condo company, they have 63 empty towers all over thailand, and they give keep giving 10 % a years to the investors even now, the bubble is about to explode, most people who invest in the last years will lose much more than what they get, but most of them are laundering money from gambling/prostitution/corruption/drugs , so they don’t really care if they lose it…

  6. Avatar

    Toby Andrews

    October 19, 2020 at 11:11 am

    Interesting murika. I believe it. The Thais are genius at inventing fraud.
    The property market will not recover for years IMHO.
    And the reason is loss of confidence.
    When a person buys a can of Singha, it is a good reliable product – he expects it.
    If he buys Singhas and they are sour. He stops buying, and switches to other brands.
    The same with property. If the property is maintained, protected, and can be sold. The buyer might buy more.
    However if suddenly he cannot access the property due to expensive and slow restrictions, the buyer will not buy more, and other buyers will not want to buy his property.
    That is the situation at present. It might change next year, but it will not make much difference because buyers have lost confidence in Thailand. What is Thailand going to do next?
    Stop foreigners buying property? It could happen. Goa did this in 2008. New Zealand has done this in 2017.
    Thailand has lost credibility, and will be a risky place to buy or lease property for some time to come.

  7. Avatar

    SG666

    October 19, 2020 at 2:13 pm

    I personally would never ever buy property in Thailand simply because the low quality and poor infrastructure not justifies the high end pricing…there are other ways for moneylaundering though.

  8. Avatar

    Frank Hilton

    October 20, 2020 at 1:28 pm

    And what about the glut of 100,000 unsold units reported earlier in the year?

    CBRE Thailand are notorious for painting a glossy picture of the Bangkok property market no matter what the market conditions on the ground. They also find room for optimism on land and buildings prices increases. The reality is that many condos are impossible to sell for anywhere near the original purchase price in the secondary market. Many people get stuck with units and have to rent them out because they cannot sell.

  9. Avatar

    Jeff Lyer

    October 25, 2020 at 5:31 pm

    I bought a 127 units in Bangkok and Pattaya and they have been excellent investments. Now is a great time to buy then sell when things get better in a few years. Most of you commenting have zero dogs in the chase and no cash on hand. I strongly recommend Cambodia also.

    • Avatar

      Andy

      November 17, 2020 at 9:18 am

      Have to agree with this.

  10. Avatar

    Marc

    November 24, 2020 at 9:10 pm

    Thailand Property market will not recover even if the Covid is gone (with a Vaccine) in 2021. There are far too many empty ones all over the country and the Thai Government’s strange behaviour towards to foreigners is being monitored every single day. The Thai government tries to cherry pick when they are not in position to do so. It will recover for a short while when the Covid is gone but in the long term the property market situation will remain the same or worse. most owners borrowed money from the bank and it is now time to pay back but they do not have funds to pay back so they are forced to reduce the price to sell them with 20% to 30% discount price in some cases 50% to 60%. It is not a good time to buy it now I would wait until Thai currency goes to the basement. it is only a matter of time. So I would advise you to wait until 2022 or 2023 when the bubble has gone burst.

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Coronavirus (Covid-19)

Thailand eyes first half of 2021 for production of AstraZeneca vaccine

Maya Taylor

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Thailand eyes first half of 2021 for production of AstraZeneca vaccine | The Thaiger
PHOTO: Lex18

Thailand hopes to begin production and administration of AstraZeneca’s Covid-19 vaccine during the first 6 months of 2021. As part of a technology-transfer agreement signed by the Thai government, Siam Bioscience will be provided with the information for vaccine production. It then hopes to register the vaccine with Thailand’s Food and Drug Administration within the next 6 months.

The pharmaceutical group hopes to manufacture sufficient doses for Thailand and its ASEAN neighbours during the first half of next year. Nation Thailand reports that the initial plan is to produce 26 million doses for 13 million Thais. It’s understood the company has the means to manufacture 180 – 200 million doses a year, or 15 million a month. Opas Karnkawinpong from Thailand’s Disease Control Department says the country will need around 2 million doses a month, with the rest being exported to neighbouring countries.

Next month, the Vaccine Board is expected to confirm the priority groups who will receive the vaccine first. They are thought to be the elderly and those with underlying conditions, the same categories prioritised for the flu vaccine, and those most at risk of developing serious complications from Covid-19.

Research released this week shows that the AstraZeneca vaccine, developed in conjunction with Oxford University in the UK, has an efficacy rate of 70%, which increases to 90% if it’s administered first as a half-dose, then a full dose. The pharmaceutical giant is now in the process of submitting its results for approval by the Food and Drug Administration, both in the UK and Europe. The company says it wants to be able to distribute the vaccine to the world, at a rate of 3.1 billion doses a year.

Meanwhile, Australian carrier Qantas has confirmed it will require passengers to show proof of vaccination, once international travel resumes.

SOURCE: Nation Thailand

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Coronavirus (Covid-19)

No vaccine, no entry – the world’s next travel challenge

The Thaiger

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No vaccine, no entry – the world’s next travel challenge | The Thaiger

OPINION

UPDATE: Australia’s national airline has already said it will impose “proof of vaccine” on all inbound and outbound international flights, a situation that IATA says they are likely to follow. Read more HERE.

ORIGINAL POST: With the announcements this week about several vaccine candidate trials, either being completed or at the end of their Phase 3 testings, and the applications to government bodies for ‘emergency approval’, we now have to face the next question.

What restrictions will be imposed on those people who don’t have the vaccine, or even actively choose not to have the vaccine?

And more locally…

Will Thailand allow people to enter Thailand without first having the Covid-19 vaccine?

Given the Thai Government’s low-risk strategy, well almost zero-risk strategy, and reluctance to take any chances with a second wave of Covid 19, it is highly likely there will be a stipulation that anyone entering Thailand will need a vaccine certificate or stamp in their passports.

Couple this with the Thai population’s continued fear of allowing foreigners back into the country at this time, in poll after poll, and it’s a safe bet there will be a “no vaccine, no entry” restriction imposed.

On a positive note, the Thai government may drop the 14 day quarantine for people that have had the vaccine (but not in the early days).

At this stage we know that most of the vaccine trials have had a 95% efficacy. We also know that the leading BioNTech/Pfizer vaccine needs an original jab plus a booster and has to be transported at extremely low temperature.

To complicate matters, there is not yet sufficient evidence that having had a bout of Covid-19, whether asymptomatic or not, guarantees you immunity. Or, if it does, for how long?

All these factors will mean that some level of quarantine will probably be in force as the Thai government slowly re-opens its borders to a wider groups of vaccinated travellers. This would remain in force until the world has a better knowledge of both the proven efficacy of the vaccine, or vaccines, and the re-infection rates.

So, even if we start getting groups of the world’s populations vaccinated before the end of the year, and that’s still a very big IF, there’s a lot more water to pass under the bridge until a coherent, reliable vaccine strategy can be understood and implemented.

Then there will be a rump of people, either hard core anti-vaxxers, or others who are at least skeptical of a new vaccine, who will want to wait or not want the vaccine at all. Public education, some strong science and a successful roll out of the early vaccines will be a key to winning over a lot of the world’s population.

Somehow governments and health authorities are going to have to wind back much of the disinformation floating around the internet about vaccines that is so factually out of whack with reality, it’s going to be one of the greatest public health challenges of all time, to reassure people about the science of vaccines and vaccination.

All this, in the middle of a pandemic that, for now, is still on the ascendency as far as new cases and deaths are concerned.

But there is little doubt rejoining the world of international travel, even local travel, could become restricted to only those who are vaccinated. The rest will be stuck roaming around their own countries, or states, for… years with a raft of restrictions on their lives. Who knows.

Will shopping centres or public buildings also impose a “no vaccine, no entry” policy? Hotels? Public buildings? Job applications?

On top of the economic stress which has fallen on a lot of the world, with so many governments now facing the headwinds of deep recession, the vaccine ‘haves’ and ‘have nots’ will add even more public disquiet.

At this stage nobody is sure how the vaccine will be rolled out in Thailand. The Thai government has already signed up for several of the leading vaccine candidates and will most likely provide the vaccine for free to citizens under its public health system.

What does that mean for foreigners living here? If you are covered, with a work permit, under the country’s public health, are you able to get the vaccine for free too? Will the thousands of foreigners on private health insurance be covered?

Surely the insurers will want its customers to be vaccinated. Sick customers cost them money. So, will insurance renewals be limited to only people who have been vaccinated? Will visas be renewed only if you have been vaccinated?

At this stage there are no firm answers to any of these questions.

Added to all this confusion, there is more than one vaccine, and some of the vaccines work in a different way than others. So do airlines and governments and shops and hotels and bowling alleys allow one vaccine through their doors but not another?

We’re certainly now entering a new phase of this pandemic. New challenges, new questions. The rising numbers of cases throughout 2020 is only the first chapter of a book that will be many more years in the making.

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Thailand

Thailand may have to wait for US vaccines from Pfizer and Moderna

The Thaiger

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Thailand may have to wait for US vaccines from Pfizer and Moderna | The Thaiger

As news that US may acquire its first shipment of Covid vaccines in mid-December, Thailand may have to wait to share the vaccines as they will likely be made available to the US and Japan first, before the rest of the world. Pfizer and Moderna recently announced their vaccines were about 95% effective, with some countries starting to preorder the vaccines despite shipment challenges that include maintaining a low temperature during transport.

Already, the US and Japan have preordered 300 and 120 million doses respectively, according to Kiat Ruxrungtham, the director of Covid-19 vaccine research and development project of the Faculty of Medicine at Chulalongkorn University. But Thailand may have other options as Kiat said 11 other pharmaceutical companies are developing the vaccine that could be distributed on a large scale. Out of Thailand’s 7 potential Covid-19 vaccines, 2 have successfully completed the animal testing stage and will proceed to human testing starting in April 2021.

However, Kiat says BioNet-Asia Co’s vaccine may be lagging behind due to the short supply of vaccine precursors, as many have been bought by bigger companies. He adds that a team has been testing Cu-Cov19, an mRNA vaccine, on macaques at Chulalongkorn University’s National Primate Research Centre in Saraburi with BioNet-Asia being the centre’s partner.

He said the project does not had sufficient funding from the government, but the state is finding ways to preorder vaccines from Covax, a company working with the World Health Organization and cooperating with AstraZeneca and Oxford University.

Today, Thailand’s CCSA reports 2 new imported cases of Covid, 1 of which is a 5 month old Indian baby girl, bringing the total number of cases to 3,922 with 0 new deaths. The Centre for Covid Situation Administration reported that the girl arrived on November 11 on the same flight as 2 previously confirmed cases. The baby tested positive 5 days later, while displaying symptoms such as a fever and vomitting.

 

SOURCE: The Phuket News

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