Economy and Geographic Location Big Interest for Chinese Investors
Economy and Geographic Location Big Interest for Chinese Investors to Thai Property
China’s massive Belt and Road initiative that spans across 24 countries including Indonesia, Malaysia, the Philippines, Thailand and Vietnam has resulted in Chinese investors making up a large chunk of the total foreign investments in real estate in these countries. While South East Asia does not play the biggest role in these plans, the strategic location of these countries in lieu of the mainland puts them in a position of integral value.
Though the Belt and Road initiative has resulted in an upward bump of Chinese investments across all countries that are a part of the Association of Southeast Asian Nations, Malaysia, the Philippines and Thailand have particularly stood out as favorites for Chinese investors looking for foreign properties.
While investment towards the Philippines is attributed to the prosperous relationship between the country and Beijing, the Philippines’ real estate market enjoys fairly strong fundamentals and is an attractive market for foreign investment in terms of yields.
Chinese investors have also, for long, perceived Malaysia as an attractive location for investment into real estate due to the country’s developed infrastructure, pleasant environment, lifestyle and political stability. Malaysia’s econd Home’ endeavors have also ranked it popularly amongst Chinese retirees.
An influx of foreign investors in the Thailand real estate market is no strange ordeal, in fact, just last year, foreign investment from mainland China accounted for more than a quarter of the total transactions in condominium according to figures by CBRE.
This outstanding influx of investors into Thai properties comes despite Beijing’s endeavors to dampen movement of capital outside of China. This is largely because the negative influence of these controls have, for a great part been offset by the positive impact dealt by the Belt and Road initiative.
Justin Brown, chairman of residential projects CBRE told China Daily Asia Weekly that the level of interest from Chinese investors in the Australia region has dropped by nearly 5 percent of purchases as a result of the newly imposed lending restrictions and increased property taxes in the area.
The interest of Chinese investors in Thailand’s properties was reiterated by leading Chinese property portal Juwai.com. The property portal signifies that properties in Thailand were the third most sought after locations according to search data.
According to the data, Bangkok’s condominiums were not the most popular out of the lot, with Pattaya leading the search results for Chinese investors looking to invest in Thailand properties for end use and otherwise. While 55 percent of the Chinese investors were looking for something for end use, a whopping 73 percent had investment property on their mind, according to Juwai.com.
The sudden increase in demand for Thai properties from Chinese investors is probably best justified by the opening of the U-Tapao International Airport that has made investment in resorts and condominiums in the region an attractive opportunity, both in terms of holiday homes, rental and long-term investment. The airport’s construction has opened up direct flights to Pattaya from three major cities in China, namely Guangzhou, Shanghai and Shenzen. This development give Chinese investors an even stronger reason to show interest in Thai properties.