Housing market in Thailand is in decline due to lower demand

23.01.2023
Housing market in Thailand is in decline due to lower demand

A decrease in the number of transactions was recorded in all regions.

In the third quarter of 2022, Thailand saw an annual inflation-adjusted decline in house prices of 2.64%, after falling 2.25% in the previous quarter and 1.48% in the first quarter. On a three-month scale, there were no significant fluctuations in the cost of housing.

The Bank of Thailand said total sales of land and buildings across the country were down nearly 35% year-over-year to 560.65 billion baht ($15.96 billion) during the first three quarters of 2022.

The number of registered condominiums in the country decreased by 3.8% to 38,687 units in the first three quarters of 2022 compared to the same period last year, after a 41.8% decline during 2021, according to data provided by BoT.

An apartment in the center of Bangkok with two bedrooms of 120 square meters costs an average of $347,368 and can be rented for $1,316 per month. This gives an annual return of 4.55%.

In the third quarter of 2022, Thailand's economy grew by 4.5%, notably better than the 2.5% and 2.3% growth recorded in previous quarters, mainly due to higher private spending, higher investment and a boost in tourism. For comparison, in 2021, the country's economy grew by only 1.6%, which is one of the lowest rates in Southeast Asia.

According to the latest Bank of Thailand forecast, the country's GDP will grow by 3.2% in 2022 and by 3.7% in 2023. As a result of the November rate hike, the central bank forecasts that inflation will remain stable at around 5.5%, which will provide a solid basis for further economic growth.